Find out about position limits, reporting regime and commitment of trader reports and the ancillary activities test.
This regime for commodity derivatives aims to prevent market abuse.
Full details of the regulatory requirements, firms and venues trading commodity derivatives are in MAR 10[1].
Position limits
A position limit is the maximum size of a net position held by a person in certain commodity derivatives traded on UK trading venues.
Position limits for commodity derivatives are set by the trading venue which lists the relevant contracts on their websites.
List of critical contracts and related contracts subject to position limits
| Contract name |
|---|
| LME Aluminium |
| LME Copper |
| LME Lead |
| LME Nickel |
| LME Tin |
| LME Zinc |
| IFEU London Cocoa Futures |
| IFEU Robusta Coffee Futures |
| IFEU White Sugar Futures |
| IFEU UK Feed Wheat Futures |
| IFEU Low Sulphur Gasoil Futures |
| IFEU UK Natural Gas Futures |
| IFEU Brent Crude Futures |
| IFEU T-West Texas Intermediate Light Sweet Crude Futures |
Read more on the framework that venues operate under in PS25/1[2] and MAR 10[1].
Position limit exemptions
Your firm can apply to the relevant venue for a position limit exemption.
Venues will assess an application against the criteria in MAR 10.2[3]. Exemptions which are granted aren’t published.
If your firm has been granted an exemption your positions will still be reported – in line with MAR 10 – but the exemption will be taken into account when the relevant position limit is applied.
Contacts for exemption enquiries:
- ICE Futures Europe – [email protected]
- London Metal Exchange – [email protected]
Reporting positions
Your firm’s position reporting obligations are set out in MAR 10.4[4] and broadly apply to:
- All trading venues in the UK trading commodity derivatives, or emission allowances or their derivatives.
- All investment firms trading the contracts in off-exchange.
- All market participants trading on a venue in either directly or through a third party, who must provide to the venue details of their own positions and the positions of their clients
Read our reporting instructions[0] for technical specifications for firms’ and venues’ position reporting.
Emission allowances classified as C(11) financial instruments under the UK definition must be reported, but they will not have a position limit.
Corrections to position reporting can be made for up to 5 years after the trading day to which the report relates.
Position management controls
UK venues trading commodity derivatives are required to have appropriate position management controls. This allows them to monitor and access information about commodity derivative positions.
FCA’s role in the position limit and reporting regime
We decide changes to the critical contracts list, and can take supervisory or enforcement actions where appropriate. This can include the use of MiFI Regulations 16, 27, and 28 to impose a limit or restriction on particular persons in exceptional circumstances.
Ancillary activity exemption
The new ancillary activities exemption (AAE) regime applies from 1 January 2027, see MAR 10A[1].
Your firm may rely on the exemption where you meet the conditions of any one of three independent tests in the framework. Each test provides an alternative route to qualifying for the exemption.
As part of the transition to the new regime, Article 72J of the Regulated Activities Order applies until 1 January 2028. If your firm intends to rely on the AAE you should review the MAR 10A rules and guidance to understand the relevant conditions and assess whether you meet the criteria.
Commitment of trader reports
Under MAR 10.4, trading venues must publish a weekly report with the aggregate positions held by the different categories of persons for the various commodity derivatives traded on the trading venue.
We publish the commitment of trader reports we receive by providing links to the respective venues’ websites:
Commitment of trader reports - ICE[2]
Commitment of trader reports - LME[3]
Contact us
If you have any questions or queries, please email [email protected].
