CALGARY, Oct. 5, 2012 /CNW/ - Natural Gas Exchange Inc. (NGX), a wholly-owned subsidiary of TMX Group, today announces that its derivatives clearing organization (DCO) is clearing all NGX energy products as futures contracts under U.S. regulations. Changes to the regulation of exempt commercial markets (ECMs) resulting from the Dodd-Frank Act for the first time require identification of NGX's contracts as either futures or swaps. Clearing its energy products as futures contracts under U.S. regulations ensures NGX's continued compliance with U.S. requirements and brings Canadian and U.S. regulation into alignment.
"NGX remains focussed on providing fair efficient markets that ensure a level playing field, best price execution and the benefits of central counterparty clearing," said Peter Krenkel, Chief Executive Officer of NGX. "We believe this clarification retains current liquidity and serves the important goal of eliminating regulatory uncertainty for our customers."
Subject to regulatory approvals, NGX anticipates registration as a Foreign Board of Trade by the end of 2012, replacing NGX's current ECM status. NGX plans as an FBOT to continue clearing contracts as a DCO. NGX will continue to clear futures contracts traded on NGX as well as clearing futures contracts in energy products under its exchange-for-physical and exchange-for-swap rule. For more information on U.S. classification of NGX products please visit www.ngx.com.
NGX provides exchange, delivery, clearing and settlement services to over 250 energy trading customers in North America. In 2008, NGX launched an alliance with IntercontinentalExchange Inc. (ICE) whereby NGX uses ICE front-end trading technology. NGX currently offers products and clearing services at over 65 natural gas, crude oil and power locations in North America.
About TMX Group (TSX:X)
TMX Group's key subsidiaries operate cash and derivative markets for multiple asset classes including equities, fixed income and energy. Toronto Stock Exchange, TSX Venture Exchange, TMX Select, Alpha Group, The Canadian Depository for Securities, Montreal Exchange, Canadian Derivatives Clearing Corporation, Natural Gas Exchange, Boston Options Exchange, Shorcan, Shorcan Energy Brokers, Equicom and other TMX Group companies provide listing markets, trading markets, clearing facilities, data products and other services to the global financial community. TMX Group is headquartered in Toronto and operates offices across Canada (Montreal, Calgary and Vancouver), in key U.S. markets (New York, Houston, Boston and Chicago) as well as in London, Beijing and Sydney. For more information about TMX Group, visit our website at www.tmx.com. Follow TMX Group on Twitter at http://twitter.com/tmxgroup.
SOURCE: TMX GROUP INC.
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