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Market Making and Liquidity Provisioning

Market Making and Liquidity Provisioning

Valid from January 2018

Eurex envisages two types of market making / liquidity provisioning activities for Futures and Options:

  • (Regulatory) Market Making, according to MiFID2
  • (commercial) Liquidity Provisioning.

These are described in the following.

The changes are valid as of January 2018.

 

Regulatory Market Making

Regulatory Market Making (RMM) applies if the conditions of section 52 of the Eurex Exchange Rules applies, which ultimately refers to Commission Delegated Regulation (EU) 2017/578 Article 1.  RMM is regulated under public law.

All Eurex Participants who fulfil the requirements stated in the Regulation have to apply for admission as (Regulatory) Market Maker at Eurex. The admission as Regulatory Market Maker in accordance with paragraph 52 of the Exchange Rules will be an admission for all Eurex products. As a result, the individual registration per product as announced in section 1.3. of Eurex circular 102/17 is no longer required and the eListing Tool will not be made available for the purposes of RMM.
An initial application as Regulatory Market Maker has to be filed until 28 February 2018, at the latest. The application form is available under the following link:

Once registered as Regulatory Market Maker, all follow-up requirements according to Eurex Exchange Rules, section 53 need to be fulfilled. According to paragraph 53 of the Exchange Rules, Regulatory Market Makers will have to fulfil the quotation requirements in at least one product on a monthly average. However, the respective competent authority of a Market Maker may impose deviating rules.
The maximum bid-ask range for Regulatory Market Making is available under the following link:

Report TD983 on the Common Report Engine will be available for all Eurex participants.  The report will provide an overview of the fulfilment of RMM criteria for all Eurex Participants and for all products.

Liquidity Provisioning

Liquidity Provisioning is a commercial activity outlined in the “Eurex Liquidity Provider Framework”. All Eurex participants can participate in the Framework by signing the Eurex Liquidity Provider Agreement (LPA). The LPA is a tri-parti agreement between the Eurex participant, Eurex Frankfurt AG and Eurex Clearing AG.

Further to the LPA, the following elements take the form of a supplement to the LPA and are integral part of it:

  • General Supplement (GS) to the LPA
  • Product Specific Supplements to the LPA.

Further to these documents, the Price List of Eurex Clearing AG applies. 

These documents contain all Liquidity Provider requirements and incentives that are available upon fulfilment of the requirements.

For all Liquidity Providers, quotation performance and payout of incentives will be performed automatically for all Eurex products. No subscription (e.g, usage of eListing Tool) on a product-by-product basis is necessary.

Eurex Liquidity Provider Framework

List of Eurex Regulatory Market Makers

According to Article 7 of Commisison Delegated Regulation (EU) 2017/578, Eurex is required to publish information on Market Makers.

List of Eurex Regulatory Market Makers, as of dd.mm.yyyy

The admission as Regulatory Market Maker in accordance with paragraph 52 of the Exchange Rules is an admission for all Eurex products.

List of Eurex Liquidity Providers

According to Article 7 of Commisison Delegated Regulation (EU) 2017/578, Eurex is required to publish information on Liquidity Providers.

Quotation Requirements

Legal Texts:

 

 

Market Status

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The Market Status Indicator displays the current technical availability of the trading system.

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