Monday, 21 April 2014

E15: Three of seven commodity exchanges in ČR may lose licence

31 October 2013

Prague, Oct 30 (CTK) - Three out of the seven active commodity exchanges in the Czech Republic are in danger of losing their licence and administrative proceedings due to breaches of law are under way with them, daily E15 writes Wednesday.

Two of them are exchanges trading in energies so that only one exchange enabling electricity and gas purchases for final consumption would be left.

The Industry and Trade Ministry leads proceedings against the Commodity Exchange Profit due to some 20 breaches of the law on commodity exchanges.

"In the amendment from the year 2011, we as the state's supervisory body have gained stronger powers. We have therefore started controls and administrative proceedings are their result," Pavel Kavina, in charge of supervision over the exchanges at the ministry, told the daily.

The ministry doubts, among other things, about the correctness in naming of the management of Profit's exchange chamber and the choice of the trading system. Profit has leased part of the system managed by company Ensytra, one of the commodity exchange's founders. The ministry says that this does not guarantee fair trading.

Profit's exchange chamber head Ondrej Grohar, however, ruled out that thanks to the system's management, Ensytra could influence the trading. "The deals are fully controlled by the commodity exchange's general secretary," he told the daily.

The Agriculture Ministry has also started administrative proceedings with the Commodity Exchange of Hradec Kralove, and with the Prague Commodity Exchange whose line includes trade in energies.

"The faults that the Prague Commodity Exchange is suspected of are such that if they are confirmed, the only possible sanction is the withdrawal of the state licence. These are not shortcomings that could be removed additionally," ministry spokeswoman Dana Vecerova told E15.

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