Compression is your friend, energy firms told as Mifid II nears

Slashing gross notional of trades can keep firms out of reach of incoming rules

One way to cut the burden of an impending wave of far-reaching European Union regulations is to make greater use of trade compression, energy companies heard at a conference on June 28.

In six months from now, the second Markets in Financial Instruments Directive, or Mifid II, will saddle commodity firms with tougher trading and, potentially, capital requirements – unless they qualify for an exemption. To obtain it, firms must prove their activities in commodity derivatives are ancillary to