04/04/2005
These two Brent incentive programs offer specific, quantifiable, transaction-based benefits; these programs can be viewed as complements to the current Brent incentive program that offers a fifty cent per lot rebate to the accounts of non-floor members registering under the program who participate in the NYMEX Brent contract. This rebate program is currently scheduled to expire as of the end of this month.
In connection with all three of these programs, the Exchange is issuing this notice to clarify and to confirm that the Exchange is committed to monitoring the benefits of these programs to preclude and to limit the benefits (to any one participant of any one of these programs or of a participant in any combination of these programs) from exceeding more than $5.00 per lot for any transaction under the programs.
Thus, for example, if a participant under the Tiered Volume Market Maker Program received a benefit of $5.00 per contract based on a particular volume of executed transactions on the Dublin trading floor, that individual would be unable to receive any additional benefits under the Local Incentive Program.
Name of Program: Tiered Volume Market Maker Program
Commencement Date:
March 29, 2005
Eligibility:
Number of participants will be limited to applicants who register for the program by March 21, 2005.
Participation will be limited to persons/entities who: (i) have a demonstrated past commitment to the NYMEX Europe Brent contract; (ii) must demonstrate continuous market-making presence on the Dublin trading floor and (iii) upon request, make a bid/ask market for 25 contracts on either side of the market. The satisfaction of these criteria is determined by NYMEX Europe staff in its sole discretion.
Term:
The market maker program will continue for the duration that Brent futures are traded at the NYMEX Europe facility in Dublin.
Any extension of the market maker program to apply following the launch of the NYMEX Europe Limited trading floor in London will be subject to Board of Directors discretion and regulatory review and/or approval. In this regard, please note that any establishment of an extension of the program to London would be subject to a separate regulatory review and approval by another regulator.
Types of Trade:
This program is available only for trading for a trade's or trading firm's own proprietary account and is not available for the execution of customer orders. In addition, this program is available only for trading executed via open outcry in Dublin and is not available for transactions in Brent executed on NYMEX ACCESS®, the Exchange's applicable electronic trading platform or for EFP or EFS transactions.
Description of Program:
All persons/entities who register and qualify for the program will be eligible for the following payments as follows:
Tier 1 User
Payment: $100,000/month
Volume requirement: Average of 1000 sides/day in Brent for each business day of the relevant month.
Tier 2 User
Payment: $50,000/month
Volume requirement: Average of 500 - 999 sides/day in Brent for each business day of the relevant month.
Tier 3 User
Payment: $15,000/month
Volume requirement: Average of 250 - 499 sides/day in Brent for each business day of the relevant month.
Limitations:
Program is capped at a total of $15,000,000. In the event that this cap should be approached prior to the termination of the program such that the full amount of the incentive payments would not be available for the most recent month of trading volume, the Exchange would disburse payments for that month on a pro-rata basis up to the level of the cap.
Implementation of all market maker programs are subject to regulatory review and/or approval by the applicable regulators and, as noted, any extension of the program in London would be subject to separate review by another regulatory agency.
Name of Program: Local Incentive Program
Commencement Date: March 29, 2005
Term: Two years after launch of NYMEX Europe London facility.
Implementation condition:
Participants in this incentive program should note that the fee reduction and allocation of a NYMEX Europe Limited seat is subject to the conditions precedent that:Eligible person:(a) NYMEX Europe Limited obtains an order declaring it to be a UK Recognised Investment Exchange (RIE); and
(b) this incentive program is approved by all relevant regulatory authorities.
All individual "local" participants trading proprietarily for their own account.
Description of Program:
All persons/entities who participate in the program will be eligible for the following incentive credits as follows:
Participants will receive a 50% fee reduction during the term of the program based upon volume traded in Dublin.
Average daily volume ("Dublin volume") will be calculated for each individual for each business day the NYMEX Europe Dublin facility is open from the commencement of the program until the launch of the NYMEX Europe facility in London.
Participants will receive on a daily basis reduced fees for five (5) times the number of Dublin volume trades. For instance, Trader XYZ trades an average of 200 trades per day from the beginning of the program until the London launch. Trader XYZ will be entitled to reduced fees on the first 1000 trades (five times 200 Dublin volume) on a daily basis.
In addition, participants who maintain a continuous presence on the Dublin facility will be entitled to one "seat" in NYMEX Europe (i.e., one trading right).
Forward Looking and Cautionary Statements
NYMEX Holdings has attempted, wherever possible, to make statements in good faith, as of the date of this release, by using words such as anticipates, believes, expects, and words and terms of similar substance in connection with any discussion of its present and future operations within the industry. Any forward-looking statements made by, or on behalf of, NYMEX Holdings and NYMEX Europe involve a number of risks, trends, uncertainties, and other factors which may cause actual results to differ materially, including receipt of the necessary Commodity Futures Trading Commission and Financial Services Authority approval; timely performance and cooperative effort of exchange partners; and changes in financial or business conditions at NYMEX.