Guide to Membership T H E K E Y T O A C C E S S B O R S A I T A L I A N A M A R K E T S

Transcription

1 Guide to Membership T H E K E Y T O A C C E S S B O R S A I T A L I A N A M A R K E T S

2 Index INTRODUCTION Pag. 3 MEMBERSHIP TO THE BORSA ITALIANA MARKETS Pag. 4 ELIGIBILITY FOR MEMBERSHIP Pag. 5 PARTICIPATION REQUIREMENTS Pag. 6 MARKET CONNECTIVITY Pag. 7 CLEARING & SETTLEMENT Pag. 8 FEES AND INCENTIVES FOR NEW MEMBERS Pag. 10 ADMISSION PROCESS Pag. 11 2

3 Introduction This guidance provides the applicant with an overview of Borsa Italiana membership procedures and documentation, eligibility, requirements, price list and financial incentives for new members. The guidance also provides a check list aiming to keep track of the progress in the membership process. 3

4 Membership to the Borsa Italiana markets Borsa Italiana SpA regulates, develops and manages the following markets. 4

5 Information on membership eligibility is available in the following paragraph. All applicant firms should fulfil Borsa Italiana membership requirements in regard to their corporate organisation and technical infrastructures. They also need to have, at all times, adequate clearing and settlement arrangements. Applicant firms may submit an application to access all markets or separate applications for each single market. Eligibility for membership The following type of firms can apply for membership: Financial Firms Firms authorized under the law or regulations to provide the services and engage in the activity of dealing for own account and/or executing orders on behalf of clients (i.e. banks, investment firms). The participation of non-eu firms is subject to the execution of an agreement between Consob and the corresponding home country Regulatory Authority. Non financial firms Companies set up in the legal form of a società per azioni, società a responsabilità limitata or equivalent in which: the personnel performing administrative, management and supervisory functions and those responsible for trading activity and the internal control function satisfy integrity and experience requirements equivalent to those applying to intermediaries that deal in financial instruments. This requirement is waived for firms authorised by an EU competent Authority to provide an investment service or activity, other than the activity of dealing for own account and/or executing orders on behalf of clients, or to provide collective portfolio management; have established an internal auditing function that does not depend hierarchically from any person with operational responsibilities and that periodically monitors the trading activity; Borsa Italiana may waive this requirement, further to the evaluation of the firm s size (according to the so-called proportionality principle); have adequate shareholders equity as shown in their latest audited annual financial statement. 5

6 Participation requirements Applicants firms shall fulfill the requirements outlined in Borsa Italiana Rules, and in particular they need to have, at all times: sufficient staff with adequate knowledge, experience, training and competence at least in the key role of the business; adequate clearing and settlement arrangements; adequate internal procedures and controls; one or more compliance officers having a good knowledge and understanding of Borsa Italiana Rules and of the rules governing the functioning of the markets and who, among his/her functions, shall manage the relationship between the firms and Borsa Italiana Market Supervision Team. adequate technical infrastructures and market connectivity according to the type of activity they want to perform and the number of interconnections they have. Software shall be accredited with Borsa Italiana. Such infrastructures can be outsourced to a third party or a Service Provider but they must be compatible with Borsa Italiana technical platform. In addition to the fulfillment of the above criteria, firms intending to act as market makers/specialists on IDEM (IDEM Equity, IDEX, AGREX) shall have their traders to complete successfully an examination. More information can be found on the Borsa Italiana Academy website More details on membership eligibility can be found in the Rules section on the Borsa Italiana website: 6

7 Market connectivity A range of different connectivity options is available to applicant firms depending on their financial needs and business model: VPN connection via Internet; Direct connection through dedicated lines installed at the firms or a third party s location (leased lines) Extranex/Bit Network; Co-location/Hosting services supported by the London Stock Exchange Group (more details are available on the Borsa Italiana and the London Stock Exchange websites; Connection through an accredited Service Provider (the list of accredited Service Providers is available on the Borsa Italiana website). More details on connectivity services are available on the Trading Services Manuals at the following Borsa Italiana websites links: Markets traded on the Millennium IT platform: Markets traded on the SOLA platform: 7

8 Clearing & Settlement Member firms must at all times have adequate clearing and settlement procedures in place. Trades executed on the MTA, TAH, ETFplus, MIV, DomesticMOT and IDEM markets are cleared by a Central Counterparty (CCP) System. The CCP manages counterparty risk by acting as a seller for the buyer and as a buyer for the seller of each trade executed on guaranteed markets. On Borsa Italiana markets this function is carried out by Cassa di Compensazione e Garanzia S.p.A. (CC&G). Applicant firms may become members of CC&G, acting as General Clearing Member (GCM), Individual Clearing Member (ICM) or Non Clearing Member (NCM). For further information please refer to the CC&G website: 8

9 Trades executed on the MTA, TAH, ETFplus, MIV, SeDeX, DomesticMOT and AIM Italia-MAC markets are settled via Express II run by Monte Titoli, the Italian Central Securities Depositary (CSD) for Borsa Italiana markets. Express II is a settlement service managing net and gross settlement functions for transactions in non-derivatives transactions. Applicants trading on guaranteed markets can access Monte Titoli directly or indirectly regardless of their CC&G membership. Should they act as NCMs on the CC&G with no direct access to Monte Titoli, they need to have their trades settled either by their GCM or by their GCM s settlement provider. Should they act as NCMs on CC&G and direct member on Monte Titoli they need to be authorized by their GCMs to settle trades via their own account at Monte Titoli. Trades executed on the EuroMOT market are settled via Clearstream Banking Luxembourg and Euroclear Bank. As a result, EuroMOT participants need to be a direct or indirect member of one the above CSDs. In case of indirect access they will use an account of a settlement provider. Trades executed on the ExtraMOT market are settled on Monte Titoli or Clearstream Banking Luxembourg/ Euroclear Bank depending on the securities traded. Therefore ExtraMOT participants need to be a direct or indirect member of both the Italiana CSD and the foreign CSDs, In case of indirect access they will use an account of a settlement provider. In order to send execution feeds from the MTA, TAH, MIV, SeDeX, DomesticMOT, EuroMOT, ExtraMOT and AIM Italia-MAC markets to a CSD applicants need to access to X-TRM pre-settlement system managed by Monte Titoli. Access to this system can be direct or via a power of attorney granted to a third party. 9

10 Fees and incentives for new members Price List Incentives for new Members For the purpose of applying the price-list two pricing options are available: Pricing Package 1 that normally charges only variable costs and Pricing Package 2 that charges fixed costs but lower variable costs. Variable costs on certain markets/segments, are progressively reduced. Members are free to choose the most suitable pricing package. These options apply to all Borsa Italiana markets, except for IDEM. All new clients of the London Stock Exchange group can benefit from financial incentives. Fees are structured as follows: Annual membership fee Annual subscription fee, debited on a monthly basis, for each individual market (if firms subscribe for package 1 this is available only for DomesticMOT) Unit cost per transaction applied to each contract/lot (IDEM Equity) /MWh (Megawattora) (IDEX)/ metric ton (AGREX) and to each executed order (for markets different from IDEM). An executed order means a trade originated by a single order entered by the member and executed at the same price. On MTA, AIM Italia-MAC, ETFplus markets transaction costs are calculated on the basis of their trade value Annual fee for connectivity debited on a quarterly basis Annual fee for logical linkups debited on a monthly basis. For IDEM Equity members a Proprietary Trading Program is also available. More specifically for the first 12 months the following incentives are applied: waiver of Borsa Italiana annual membership fee waiver of the MTA/AIM Italia-MAC/SeDeX/ETFplus/MOT subscription fees waiver of the IDEM Equity volume category fee waiver of the IDEX volume category fee A 50% discount on CC&G annual membership fee is also applied (for additional information about the clearing fees please visit the CC&G website). The initiative applies to: - Firms becoming new trading members on Borsa Italiana markets - Existing member firms deciding to extend their membership to other Borsa Italiana markets/segments. For information on charges and payment instructions please refer to the Price List for Trading Services enclosed to the General Conditions of the membership contract and available on the Borsa Italiana website - Intermediaries section Contracts area. Information on incentives for new members is available on the Borsa Italiana website - Intermediary section - Membership area. 10

11 Admission process Membership applications can be managed on line via the BIt Club website ( Access to BIt Club can also be found in the Membership section of the Borsa Italiana website For more information on the completion of the membership documents on BIt Club please refer to the Membership Guide, available on the BIt Club website. Timeline, steps/actions and documentation To start the process applicants need to submit a Request for Service. The process ends when market admission is granted provided that all membership requirements have been satisfied by the applicants. A check list of all steps of the membership process is provided in the next paragraph. 11

12 Checklist 1 Access to BIt Club ( Upon completion of a Welcome Card applicants is going to receive a UserID and a password to access to the Prospect Area of BIt Club 2 Request for Service (RfS) (contract proposal) Once applicants completed the RfS providing a Contract Representative s contact details, they print it and send the Membership Team a copy signed by the Legal Representative of the Company. Firms should also include: Contract Representative s Specimen of signature (a form for the specimen of signature can be downloaded from the website) A proof of regulatory authorization to provide investment services, if applicable The form on the Traceability of financial flow (Law 13th August 2010 no. 136) downloadable at he following link: Further information are available on General Conditions Part I (Intermediaries/Contracts area on website). 3 Borsa Italiana letter confirming receipt of the RfS Applicants receive a letter of acknowledgement from Borsa Italiana, requesting to complete the Participation Document on BIt Club. The Contract Representative receives a new userid and password to access BIt Club and can delegate information management on BIt Club to different Company Users acting as a deputy of the Contract Representative 4 Confirmation of the participation requirements The following information should be provided online: - Declaration of fulfillment of the participation requirements as outlined by the Rules, including the additional authorisation requirements requested to unauthorized firms - BIC code confirmation - Pricing package confirmation (if applicable) - Confirmation of IT sites and trading office addresses - Confirmation of technical set up including: order of connectivity lines (if applicable) request of USAPs/User IDs request for market data channels The applicant can now request access to the testing environment for third party connectivity providers via VPN. Access to the testing environment is required if the applicant s software applications are not accredited by Borsa Italiana yet and need to certified. If the applicant needs to set up connectivity lines this should be completed at this stage. - Confirmation of Compliance Officer and Deputy(if any) contacts - Confirmation of the list of persons authorized to request order deletion - Confirmation of the type of participation in the clearing and settlement system. If the applicant is getting access to non guaranteed markets and is going to have its business settled by a third party, a copy of the notification letter of their settlement agreement signed by both parties should be provided 5 IT configuration A configuration in CDS is required only for conformance tests and functional tests (so called check list) 6 Participation to the clearing and settlement systems Confirmation of participation in the settlement and clearing services provided by the companies managing such services 7 Admission to trading A go live date is agreed with the applicants upon approval of membership application. Borsa Italiana informs the market on new member admissions by publishing an announcement normally the day before the go live date. If trading on a derivatives market new members receive a User and password to access the production environment. 12

13 For additional information Please visit or the membership Team: For technical information: 13

14 Settembre 2011 Borsa Italiana London Stock Exchange Group. Tutti i diritti sono riservati La pubblicazione del presente documento non costituisce attività di sollecitazione del pubblico risparmio da parte di Borsa Italiana S.p.A. e non costituisce alcun giudizio, da parte della stessa, sull opportunità dell eventuale investimento descritto. Il presente documento non è da considerarsi esaustivo ma ha solo scopi informativi. I dati in esso contenuti possono essere utilizzati per soli fini personali. Borsa Italiana non deve essere ritenuta responsabile per eventuali danni, derivanti anche da imprecisioni e/o errori, che possano derivare all utente e/o a terzi dall uso dei dati contenuti nel presente documento. I marchi Borsa Italiana, IDEM, MOT, MTA, STAR, SeDeX, MIB, IDEX, BIt Club, Academy, MiniFIB, DDM, EuroMOT, Market Connect, NIS, Borsa Virtuale, ExtraMOT, MIV, Bit Systems, Piazza Affari Gestione e Servizi, Palazzo Mezzanotte Congress and Training Centre, PAGS nonché il marchio figurativo costituito da tre losanghe in obliquo sono di proprietà di Borsa Italiana S.p.A. Il marchio FTSE è di proprietà di London Stock Exhange plc e di Financial Times Limited ed è utilizzato da FTSE International Limited sotto licenza. Il marchio London Stock Exchange ed il relativo logo, nonché il marchio AIM sono di proprietà di London Stock Exchange plc. I suddetti marchi, nonché gli ulteriori marchi di proprietà del London Stock Exchange Group, non possono essere utilizzati senza il preventivo consenso scritto della società del Gruppo proprietaria del marchio. La società Borsa Italiana e le società dalla stessa controllate sono sottoposte all attività di direzione e coordinamento di London Stock Exchange Group Holdings (Italy) Ltd Italian branch. Il Gruppo promuove e offre i servizi Post Negoziazione prestati da Cassa di Compensazione e Garanzia S.p.A. e da Monte Titoli S.p.A., secondo modalità eque, trasparenti e non discriminatorie e sulla base di criteri e procedure che assicurano l interoperabilità, la sicurezza e la parità di trattamento tra infrastrutture di mercato, a tutti i soggetti che ne facciano domanda e siano a ciò qualificati in base alle norme nazionali e comunitarie e alle regole vigenti nonché alle determinazioni delle competenti Autorità. 14

15 Borsa Italiana S.p.A Piazza Affari, Milano T membership@borsaitaliana.it