ACM conducted a dawn raid because of possible insider trading on energy market

In late-March, the Netherlands Authority for Consumers and Markets (ACM) conducted a dawn raid at a company that is active in the electricity sector. The reason for this dawn raid was to investigate whether or not the company involved violated the prohibition on insider trading on the energy market. ACM also wishes to investigate whether the company published inside information correctly, so that all market participants had access to the same information at the same time.

Helping boost confidence in the energy market

ACM’s dawn raid is part of its enforcement of compliance with the European Regulation on Wholesale Energy Market Integrity and Transparency (REMIT), which is one of ACM’s duties. REMIT’s objective is to detect and prevent market abuse on the wholesale energy market.

Remko Bos, Director of ACM’s Energy Department, comments: ‘By enforcing compliance with REMIT, we help boost consumer confidence and that of other market participants in the energy market. We do so in cooperation with our fellow European regulators. REMIT promotes competition, which leads to competitive prices for consumers.’

Collecting leads and conducting investigations

ACM’s dawn raid is the first one in the Netherlands that is conducted under REMIT. ACM makes sure in various ways that market participants comply with REMIT requirements. For example, over the past few years, ACM made sure that companies were better able to meet their REMIT requirements by having them organize themselves accordingly. Furthermore, ACM collects leads about possible violations. These leads come from energy exchanges and brokers, for example. They are required to inform ACM when they suspect insider trading or market manipulation. ACM also receives alerts from ACER, the Agency for the Cooperation of Energy Regulators in the EU. ACM may launch a formal investigation if the leads give reason for one. This dawn raid is the beginning of such a formal investigation.  

What are the next steps in this investigation?

This dawn raid is the first step in the investigation into possible violations of REMIT. If ACM comes to the conclusion that violations have indeed occurred, the company will have the opportunity to tell its side of the story before ACM can impose a sanction. ACM could also reach the conclusion that no violation occurred.