EU Energy Regulators Pick Nasdaq’s Surveillance Software

The European Agency for the Cooperation of Energy Regulators picked software from Nasdaq OMX Group Inc., as it gears up to oversee wholesale gas and electricity trading in the European Union.

The SMARTS surveillance platform can be used to detect insider trading and market manipulation and will help enforce EU energy market regulations, New York-based Nasdaq OMX said in an e-mailed statement on Jan. 18. No commercial details of the agreement were disclosed.

“The technology helps to identify and assess suspicious patterns of behavior,” Paul McKeown, vice president of market technology at Nasdaq OMX, said by phone from New York on Jan. 18. The platform can “break down all orders and transactions to find out what was done, when was it done and who did it.”

The regulators’ group, known as ACER, is tasked with safeguarding integrity and transparency of the market and detecting insider trading and market manipulation. The agency will next year gain access to all transactions in spot and derivatives products for power and gas from all EU trading venues and bilateral transactions, under strengthened monitoring powers defined under the EU regulation on energy market integrity and transparency, called Remit.

The Nasdaq OMX software is already used in the Nordic wholesale power market, as well as by financial regulators and stock exchanges worldwide, Volker Zuleger, ACER’s head of market monitoring department, said yesterday by phone from Ljubljana, Slovenia.

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