Draft:Romanian Commodities Exchange

• Comment: After I asked you to add independent sources, you have added a single source, which you wrote and published today. Kovcszaln6 (talk) 12:01, 28 July 2025 (UTC)

• Comment: Needs way more reliable, independent, in-depth sources. Kovcszaln6 (talk) 10:17, 28 July 2025 (UTC)

• Comment: Needs references. Stuartyeates (talk) 11:20, 25 July 2025 (UTC)

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BRM

Romanian Commodities Exchange
Type	Physical commodity and derivates exchange
Location	Bucharest, Romania
Founded	1992
Commodities	Electric power Natural gas CO2 Emission Allowances Petroleum products Construction materials
Indices	brm.ro/rogas/
Website	brm.ro/en/

Romanian Commodities Exchange (BRM) is a public interest institution and an authorized market operator, which provides the organized framework for trading energy products, commodities and services, under conditions of transparency, competition and equal opportunities for all participants. Established in 1992, BRM operates as a mixed exchange, combining operations with physical commodities, services and financial instruments, playing a role in the development of trade and competitive markets in Romania.

Through the development of specialized electronic platforms, BRM facilitates daily trading, public auctions and organized trading on several markets:

• Wholesale electricity market - includes the PZU, PI, PMC and Forward segments.
• Wholesale natural gas market - includes Gas Spot, Forward, CCP, Balancing and Futures segments.
• Availability (retail) market - brings together rings for energy, agricultural, oil and other products.
• Auction market - facilitates transactions for goods, services, space rental, waste recovery.
• Capital market - provides financial services through SSIF and BRM-OTF platform.

History

The Romanian Commodities Exchange is organized on the model of the major international exchanges, benefiting from a hierarchical system that supports decision-making and operational activity.

The official opening of the BRM took place on November 20, 1992 and the first trading session was held on December 10, 1992. The first products traded were aluminum, cocoa powder, Brazil green coffee, bovine hides and paper.

Timeline BRM

BRM Markets

In economics, a market is a system that brings people together using prices to share information between businesses, homes, and people in order to control the making and sharing of goods. In his important 1937 article "The Nature of the Firm", Ronald Coase wrote: "An economist sees the economy as being organized by the price system. . . in economic ideas, we see that the price system decides how to give out the things needed to make goods. " So, using the price system to share information is what makes a market what it is. This is different from a company, which Coase said is different because it does not use the price system.

The significance of organizations like the Romanian Commodities Exchange (BRM), which puts these ideas into effect, is clarified by this theoretical viewpoint on markets. BRM facilitates market-based coordination for energy and commodity transactions in Romania by setting up centralized platforms where prices are determined by competitive bidding. According to the economic definition of a market, which is a price-based information system, each of its marketplaces is made to promote efficiency, transparency, and regulatory compliance.

Wholesale Natural Gas Market

This market includes the Day-Ahead, Intraday, Forward, CCP, Balancing, and Futures segments. Transactions are addressed to suppliers, traders, and wholesale consumers, covering both short-term and long-term deliveries.

The wholesale natural gas market is designed for companies that buy and sell large quantities of natural gas. Transactions can be made either for immediate delivery (on the following day or the same day) or for future deliveries based on medium- or long-term contracts.

Types of available transactions

• Day-Ahead: Gas is bought or sold for delivery on the following day.
• Intraday: Transactions are conducted for same-day delivery.
• Forward (Medium- and Long-Term): Contracts are concluded for delivery in the following weeks or months.
• Balancing Market: Supports system operators in correcting imbalances between estimated and actual gas consumption.

Wholesale Electricity Market

The wholesale electricity market includes the Day-Ahead Market (DAM), Intraday Market (IDM), Large Consumers Market (PMC), and Forward segment. It enables the setting of daily prices, same-day quantity adjustments, and long-term contract-based trading.

Types of available transactions

• Day-Ahead Market (DAM): Electricity prices are set for the following day based on supply and demand conditions.
• Intraday Market (IDM): Enables same-day trading adjustments to match real-time consumption needs.
• Forward Contracts: Long-term agreements are concluded for future electricity deliveries at pre-agreed prices.
• Large Consumers Market (PMC): Allows major industrial consumers to purchase electricity through negotiated contracts.

Retail Market

The word "retail" comes from the old French verb "retaillier," which meant "to shape by cutting" (around 1365). The first time it was written down as a noun was in 1433. At that time, it meant "a sale in small amounts. " This came from the Middle French verb "retailler," meaning "a piece cut off, shred, scrap, paring. " Today, the word "retail" (in English, French, Dutch, German, and Spanish) means selling small amounts of things to customers, not selling wholesale.

The Retail Market, also known as the Disponibil Market, is the component of the Romanian Commodities Exchange (BRM) dedicated to those companies and institutions that wish to purchase products or services in an organized and transparent framework.

This platform operates through specialized trading rings that cover a wide range of products, from natural gas and electricity to petroleum products such as diesel and gasoline, construction materials, vegetables, fruits, cereals, as well as instruments like CO₂ emission certificates.

Thus, participants can acquire essential goods directly through BRM, in a competitive and transparent environment, while also benefiting from the procedural support provided by the exchange.

Auctions Market

The Auctions Market organized by the Romanian Commodities Exchange (BRM) is a specialized platform that allows for the buying or selling of goods, products, services, rental of spaces, or valorization of waste in a competitive, transparent, and efficient manner. This market is open to both private sector entities and public institutions, as well as individuals.

It is accessible to public and private entities for the sale or purchase of goods, spaces, and services. The procedures can be conducted either physically or electronically.

Auction Market

Capital Market

In addition to its role as a commodity market operator, the Romanian Commodities Exchange (BRM) also functions as an investment services company (SSIF), in accordance with Romania's capital market regulations. In this capacity, BRM is authorized to perform a wide range of financial market activities, including receiving and transmitting trading orders, executing orders on behalf of clients, and proprietary trading.

BRM also provides portfolio management services, financial advisory, and intermediation of placements of financial instruments, thereby contributing to the development of a professional and regulated investment environment.

Additionally, BRM manages a platform called BRM-OTF (Organized Trading Facility), where greenhouse gas emission certificates are traded. These certificates are part of the European Union's pollution reduction mechanism and can be bought or sold by companies that must comply with EU emission limits.

This component contributes to integrating Romania's market into European financial and climate mechanisms, while providing investors with modern risk management tools.

International Expansion

Republic of Moldova

In 2021, the Romanian Commodities Exchange established the company "Romanian Commodities Exchange Est" S.R.L. in the Republic of Moldova, formerly known as "BRM East Energy." The new entity is wholly owned by BRM and operates as a regional extension of the Romanian operator, with the main objective of facilitating centralized natural gas trading in Moldova.

On March 14, 2022, the National Agency for Energy Regulation (ANRE) of the Republic of Moldova approved the operation of this entity as the operator of the natural gas trading platform, following a request submitted by Moldovatransgaz S.R.L. This official recognition enabled BRM Est to become the only legally operating exchange on the Moldovan gas market.

A major strategic objective of BRM Est is to capitalize on Moldova's access to the European energy market via Romania by offering efficient alternatives for natural gas supply and reducing dependency on single sources. In this context, BRM Est plays a key role in diversifying Moldova's gas market and supporting local consumers and companies in integrating into the regional market.

Bulgaria

The Romanian Commodities Exchange expanded its strategic operations in Bulgaria through the acquisition of the Bulgarian Energy Trading Platform AD (BETP AD), strengthening its role as a regional operator in natural gas trading.

In December 2024, BRM announced the signing of an agreement to acquire BETP AD, a Bulgarian platform licensed for gas market operation and recognized as a key player in Bulgaria's natural gas trading sector. The acquisition was welcomed as a strategic move for regional energy security, aiming to: increase competitiveness and transparency in Bulgaria's gas market, expand trading opportunities for companies in both countries, diversify energy sources, and reduce dependence on Russia.

The operation integrates BRM's experience in clearing and risk management for both the Romanian and Bulgarian markets.

Central Counterparty (CCP)

A central clearing counterparty (CCP), also known as a central counterparty, is a financial organization that deals with financial markets. It reduces the risk that one party in a transaction won't pay what they owe to the other party. It also provides services to finalize trades in foreign exchange, securities, options, and derivative contracts. CCPs are institutions with many rules that focus on managing the risk that one party in a transaction might not pay.

CCP Implementation at BRM

The Romanian Commodities Exchange (BRM) implemented the Central Counterparty (CCP) system in 2020 for the wholesale natural gas market, and as of 2024, the mechanism has also been extended to the wholesale electricity market. Through this system, BRM acts as a contractual intermediary between market participants, becoming the buyer to every seller and the seller to every buyer. Transactions are carried out anonymously and in a standardized format, without the counterparties knowing each other, increasing transparency and efficiency in centralized markets.

As a Central Counterparty, BRM financially interposes itself between sellers and buyers on the Intraday Electricity Market, ensuring the efficient settlement of transactions. It monitors the financial standing of participants and may request relevant information to ensure their solvency. Its role is essential for market stability, facilitating transactions and protecting participants by managing financial risks.

Electricity CCP trading applies the same margining mechanism used by BRM on the Gas Forward Market under central counterparty rules—a model already operationally validated and proven in practice. Moreover, participants can reallocate collateral between BRM-administered markets—including between Romania and Bulgaria—through the centralized collateral management module.

Advantages of the CCP System

The CCP mechanism offers multiple advantages for market participants and the stability of the system as a whole. Firstly, it eliminates counterparty risk, protecting participants against payment or delivery default. If one party fails to meet its obligations, the CCP intervenes and ensures transaction completion. The system also allows for netting of positions, reducing exposure and optimizing the use of collateral and capital.

Another major benefit is improved market accessibility for smaller or new participants, who would typically lack access to bilateral OTC (over-the-counter) transactions, where terms are negotiated directly and may favor large or traditional participants. In addition, anonymous and standardized trading prevents the formation of exclusive eligibility groups and reduces the risk of anti-competitive practices or market manipulation—issues frequently highlighted by the Competition Council in the context of bilateral contracts.

CCP advantages

Legal Basis

The CCP system applied by BRM complies with European regulations and benefits from the so-called REMIT carve-out, as stipulated in Regulation (EU) No. 1227/2011 on wholesale energy market integrity and transparency. This carve-out clarifies that physically settled wholesale energy products are not considered financial instruments under MiFID II (Directive 2014/65/EU) and are not subject to EMIR (Regulation on derivatives clearing). Therefore, BRM can operate a CCP without the need to authorize it as a financial entity, offering important flexibility for the development of energy markets.

This approach is aligned with the practice of other European energy exchanges, including those designated for market coupling operations, which use similar guarantee and settlement models for physically delivered products.

Performance and Stability

Since launching the CCP system, BRM has recorded no payment defaults, demonstrating the efficiency and reliability of the mechanism in supporting secure and transparent transactions. Unlike bilateral systems—frequently flagged by regulators for possible manipulation or anti-competitive agreements—BRM's CCP model has contributed to strengthening trust in the organized market.

Furthermore, the CCP enables clear risk management and continuous monitoring of collateral, exposure, and financial flows to the benefit of all participants.

By adopting the central counterparty model, BRM reinforces its position as a modern and secure infrastructure for Romania's energy markets, aligning with international standards and contributing to the development of a fair and transparent competitive environment.

See also

Comparable international exchanges

• Nord Pool
• TMX Group

Regulations and agencies

• Regulation on Wholesale Energy Market Integrity and Transparency
• Agency for the Cooperation of Energy Regulators
• Energy Community

References

Category:Finance in Romania Romania Romania Category:Financial services companies of Romania Category:List of major stock exchanges