jsc commodity exchange ‘‘caspian’’ emissions trading at jsc commodity exchange “caspian”
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JSC Commodity Exchange “Caspian” (further JSC “TBC”) is registered as the legal entity on November 18, 2011On December 30, 2011 JSC “TBC” obtained the state license No. 1000349 for the implementation of commodity exchangeThe first biddings on an exchange platform took place on December 30, 2011 at once after receipt of the license on agricultural products section.In January 2012, we launched an online electronic trading system and began regular trading on the section of industrial and consumer goods, agricultural products, oil and petroleum products, metals and metal products.Presently the organized commodity market becomes more and more demanded attribute in system of the market relations of domestic enterprises.Main objective of the exchange is forming of the organized commodity market providing concentration in one place of the demand and supply, and also establishment of the clear and transparent mechanism of forming of fair prices for basic commodities. The correctly organized commodity exchange building a system of guarantees of execution of transactions and helps to improve the liquidity of the commodity market, and hence the popularity of organized trade through the exchange infrastructure.From the moment of the basis of JSC “TBC” cooperates with commodity exchanges of CIS countries and foreign countries, the Kazakhstan and foreign banks, the Ministry of economic development and trade of the Republic of Kazakhstan, and also is official member of the Interexchange electronic union of the countries of EurAsEC.Our brokerage companies have the certified accreditation, and the personnel of the Exchange was trained concerning the organization of commodity exchange trading on leading exchange platforms of the worldToday JSC “TBC” conducts the biddings on the principles of publicity and equality. The agreements signed at the exchange are not subject to notarial certification, and are obligatory for accomplishment by their parties in case of internal and external economic relations. Clients of the Exchange use various services of JSC “TBC”: informational, advisory and etc.JSC “TBC” takes active part in reforming of national economy, development of international economic relations, and also formation of the market relations.Computer support of the bidding process, skilled specialists, standardization of conditions and exact accomplishment of rules erects to a minimum of loss of time for the conclusion of agreements.
JSC Commodity Exchange “Caspian”
About JSC “TBC”
JSC Commodity Exchange “Caspian”
The system of trading and clearing
Clearing
Client
Member of Clearing House
Member of Clearing House
Clearing
Exchange
Head of exchange
Client
The clearing exchange center
JSC Commodity Exchange “Caspian”
Structure of elements and control
Supervisorycouncil
Market research
Council of the exchange
• Shareholders
The exchange Arbitration
Exchange management
Reporting
ManagementCurrent work
Private law
Public law
• represents members of trade
•Permanent control
The Commission onsanctions
• The current work at the exchange
JSC Commodity Exchange “Caspian”
State control and cooperation.
Council of the exchange www.tbc.kz
Council of the exchange www.tbc.kz
The International Arbitration Court "IUS" www.iusea.com
The International Arbitration Court "IUS" www.iusea.com
JSC “Zhasyl Damu” www.zhasyldamu.kz
JSC “Zhasyl Damu” www.zhasyldamu.kz
The ecological code of Republic of Kazakhstan (Head – 9-1); The Order of the Government Republic of Kazakhstan of December 13, 2012 No. 1588 "About approval of the National plan of distribution of quotas of emissions of greenhouse gases for 2013"; The Order of the Minister of May 11, 2012 No. 151-p "Rules of trade in quotas of emissions of greenhouse gases and carbon units";
Exchange trading rules from 10.08.2012, theTerms of trade quotas on greenhouse gas emissions and carbon credits from 01.08.2013.
Law of Republic of Kazakhstan of 28.12.2004 N 22-3 "On arbitration courts"Rules of the International Arbitration Court «IUS»
Committee of trade of Department of Economic Affairs and budgetary planning
of the Republic of Kazakhstan www.comtorg.kz
Committee of trade of Department of Economic Affairs and budgetary planning
of the Republic of Kazakhstan www.comtorg.kz
The Law of the Republic of Kazakhstan "On Commodity Exchanges" from 03.07.2013Resolution of the Government of the Republic of Kazakhstan on December 28, 2012 № 1707Resolution of the Government of the Republic of Kazakhstan on December 20, 2012 № 1644Resolution of the Government of the Republic of Kazakhstan on December 21, 2012 № 1653Resolution of the Government of the Republic of Kazakhstan on December 6, 2012 № 1552
JSC Commodity Exchange “Caspian”
The contractual framework of control
Terms and Conditions
Clearing member
Terms of non-clearing
members
Clearing agreement
• Exchange trading rules• Terms of trading• Code of Conduct• conditions of a contract• tariffs
• clearing conditions
Exchange The clearing exchange center
Terms of clearing membersof non-
clearing participant
=trader
Agreement on the exchange
Transport System Operator
trade agreement
Registration
JSC Commodity Exchange “Caspian”
Activization of all groups of participants
Hedged bidders
Hedging with futures(for example, with respect to volatile spot prices of quota)
Hedging with provision of possibility of participation in favorable development of the prices on condition of an award.
Arbitrage trading participants
Strategy of trade in case of which in proportion incorrectly estimated tools for receipt of risk-free profitability are used.
Time arbitrage: In case of time arbitrage the line item which is liquidated again by means of simultaneous transactions with derivative financial instruments, opens in certain time.
Third bidder
The contract is bought / sold in anticipation of changes in market prices in order to eliminate later with the benefit of the final position. Third bidders take a risk and provide liquidity support to other bidders with different views on the market..
JSC Commodity Exchange “Caspian”
Offers urgent and trade spot
Spot market Derivatives market
Market structure
Today: =< 2 days > 2 days
Biddings delivery
payment Biddings delivery
payment
The market of deliveries according to transactions for term
Annual market of deliveries
JSC Commodity Exchange “Caspian”
Standardization of all processes• Standardized terms of the Contract:• The set quantity and quality,• Place of delivery period / delivery date,• If necessary, the type of product,• Terms of payment• Speed of / size and scope of the contract,• The asking price, the type of the option and the exercise price
• Standardized bidding procedures :• Trading hours• Pricing• Reconciliation
• A standardized clearing and settlement:• Providing liabilities, daily calculations, final settlements, consecutive arrangement of
contracts (if necessary), delivery, payment of option premiums, option implementation, concession, mutual settlement of requirements and contract obligations
Participants shall agree only about the price and number of contracts
JSC Commodity Exchange “Caspian”
Portfolio of products for the bidder
Primary implementation
Derivatives market
Secondary implementation
Spot market
Rights to CO2 emissionThe contract on a basisnational plan.Spot auction based on KZQ
Derivatives market
Rights to CO2 emissionAuctions KZQAuctions of derivatives KZQ Futures KZQ
Rights to CO2 emissionAuctions KZQAuctions of derivatives KZQ
Completely integrated clearing and cross-margining through commodity exchange “Caspian”
EEXEEXTrade participant
buyer
Trade participant
sellerClearing member
Report of JSC “Zhasyl Damu”list of quotas
Report of JSC “Zhasyl Damu”list of quotas
Clearing centre of ExchangeClearing centre of Exchange
CO2 certificate
CO2 certificate
4 CO2 certificate
CO2 certificate
1
Money3
Money3
CO2 certificates
3
Buyer reportBuyer report
Internal reportBuyer
Internal reportSeller
Seller reportSeller report
Order2
Order2
Clearing member
Clearing memberJSC Commodity Exchange
“Caspian”
Clearing member
Clearing member
JSC Commodity Exchange “Caspian”
Cooperation with departments on registration
JSC Commodity Exchange “Caspian”
Effective risk management system
• The Clearing House (KCB) assumes counter-party risk according to all transactions.
• For the purpose of ensuring accomplishment of all transactions in case of insolvency of KCB requires providing liabilities, a so-called margin.
• Calculations are conducted on the basis of world-wide acknowledged methods.
• KCB accepts securities or cash in quality providing liabilities.
• Providing liabilities of KCB is encumbered with pledge with parties of the member of clearing.
• Providing liabilities of the member of clearing are encumbered with pledge at least the same size from outside member of the transaction. Members of the biddings can make recalculation
KCB
Participant of margin trading
Member of a clearing margin
Clearing fund
Trade participant
Clearing member
Clearing center of exchange
JSC Commodity Exchange “Caspian”
Effective trading and back office systems
System settlement
Spothandels-systeme
Spothandels-systemeTrader
Spothandels-systeme
Spothandels-systeme
Clearing member
Exchange
System of Derivative trading
Reports / Interfaces
Clearing system
Real delivery
Internal back office / Cost accounting / Risk management system
Internal system of conducting financial accounting
Reports / Interfaces
System of spot trading
JSC Commodity Exchange “Caspian”
Flexible technical connections
•MISS = System server of members of integration
Internet AccessInternet connection
Joint access Connection through the allocated
line and Internet
Premium AccessConnection through
2 allocated lines
Exchange database
Web Access
The 2nd connection with other provider (in case of opportunity)
Access pointAccess point Access point
Reserve *MISS
Internet
*MISS-group
*MISS /LAN
terminal
Router
Router
Internet
*MISS-group
*MISS /LAN
terminal
Router
Router
*MISS-group
Reserve *MISSTra
der
Exc
han
ge
Internet
Terminals with connection the Internet and a
token
Reserve *MISS
JSC Commodity Exchange “Caspian”
010000, Аstana, Kazakhstan, Business Centre “Caspian” Taha Hussein street, 9
www.tbc.kzfax : +7 7172 570 080tel.: +7 7172 571 002E-mail: info@tbc.kz
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