Financial and Energy Exchange Group

	Website Mercari

FEX Group

FEX Group is an Australian unlisted public company established in 2006.

The business aim of the FEX Group is to offer globally competitive licensed marketplaces for both derivative and equity products with a particular focus on the development and listing of tradeable products within the commodity, energy and environmental asset classes. FEX Group markets seek to provide market participants and users in the Asian-Pacific region greater product relevance to enhance both the management of risk and the facilitation of investment in the region.

Confidence in the licensed markets owned directly or indirectly by FEX Group is reinforced by the market supervision and regulatory role undertaken by the Australian Securities and Investments Commission (ASIC) as well as through the Reserve Bank of Australia's oversight of financial system stability. In addition ASIC also supervises FEX Group as an unlisted public company.

Mercari OTC Swap Execution Facility

The FEX Group owns a 100% interest in the licensed OTC Swap Execution facility known as Mercari Direct.

Mercari was established in 2005 and since January 2011 has been licensed to offer OTC markets in commodity, energy, interest rate, foreign currency and environmental product. Mercari uses the Mercari eSEF technology to operate the market place and is supervised by ASIC.

For further information on Mercari and the products on Mercari market, please visit [www.mercari.com.au]

SIM Venture Securities Exchange (SIM VSE)

FEX is a 50% owner of SIM Venture Securities Exchange (SIM VSE). SIM VSE operates a securities market specializing in listings for 'cleantech' companies.

The SIM Venture Securities Exchange is a stock exchange licensed by the Australian government and regulated by the Australian Securities and Investment Commission (ASIC). SIM VSE provides a fully electronic market platform with straight through settlement via the CHESS registration system.

In November 2011, SIM VSE listed its first company, Green Tech Flagship Limited and opened its first IPO, Frontier Solar Limited. Another listing is expected before the end of 2011.

SIM VSE is Asia-Pacific's oldest stock exchange having originally been established as the Sandhurst Stock Exchange in 1862; twelve years before the 1874 origins of the Bombay Stock Exchange.

For further information on each of the exchange's rules and products visit [www.simvse.com.au].

FEX Derivatives

At present, there are only two domestic Australian Market Licenses (AML) issued to operate retail and wholesale exchange-traded derivatives markets in Australia. Both of these licenses are controlled by the ASX Group.

Financial and Energy Exchange Limited (FEX) is currently seeking approval from the Minister for an Australian Market License under s795B of the Corporations Act 2001 (Corporations Act) to open and operate the FEX Derivatives Market. The FEX Derivatives Market will be an electronically traded futures and options market. For the purpose of its clearing and settlement arrangements, FEX has contracted an independent global clearing house to provide clearing services for the FEX market.

This independent clearing house has itself applied to the Minister, under s824B(2) of the Corporations Act for an Australian clearing and settlement facility License (CSFL) to enable it to clear and settle transactions entered into on the FEX market.

Other Ventures and Investment

The FEX Group has additional investments in other relevant licensed marketplaces and businesses. This includes a 35 percent holding in Envex, an environmental product and market development company. Envex itself owns the WaterExchange, an electronic market for the trading of water permits and entitlements, and Next Generation Energy Solutions, the leading Australian broker of electricity and environmental products.

Shareholders

The FEX Group ownership is comprised of a consortium of energy and financial market participants, traders and investors. Shareholders include major mainland Chinese energy and investment groups, NasdaqOMX, AMB Holdings of Western Australia and the private equity group Iron Mountain.

News

• June 30, 2010: FEX launched SIM Venture Securities Exchange Limited (SIM VSE), a equities market for clean-tech firms, renewable energy and other related companies. Established in 2010, SIM VSE is a joint venture between Financial and Energy Exchange Limited (FEX) and the National Stock Exchange of Australia Limited (NSX). Established in 2010, SIM VSE is a joint venture between Financial and Energy Exchange Limited (FEX) and the National Stock Exchange of Australia Limited (NSX)

• Dec. 30, 2009: FEX and China Beijing Environmental Energy Exchange (CBEEX) announced an agreement to work jointly on energy savings and carbon emissions reductions in Australia and China.

• Nov. 7, 2008: In conjunction with FEX’s environmental product development partner enVex, the FEX Mercari Environmental ECN opened in November 2008. The first completed trade was for a AU$230,000 parcel of Australian Renewable Energy Certificates (RECs).

• Sept. 9, 2008: RTS Realtime Systems Group, a leading trading solutions provider, announced that it has committed to provide connectivity to FEX.^[1]

• Aug. 26, 2008: GL TRADE, a global provider of multi-market and multi-asset solutions for international financial institutions, is pleased to announce that the group will provide ASP connectivity to Australia’s Financial & Energy Exchange (FEX).

• July 15, 2008: FEX selected Argus Media’s price indices to settle their new exchange traded and over-the-counter coal contracts. Open positions in FEX coal contracts will be settled in reference to the Argus Newcastle index which is based on the price of Newcastle (Australia) loading coal. The Argus fob Newcastle price is published in Argus Coal Daily International, which provides benchmark assessments for the international coal trading community.^[2]

• July 1, 2008: In a move that is expected to accelerate the development of global carbon emissions trading, Climate Exchange plc, operator of the world’s largest carbon emissions marketplaces, has today acquired a 25 percent stake in enVex from FEX and Macquarie Capital Group.

• May 21, 2008: FEX and Macquarie Group Limited announced the formation of a new company, enVex, to design environment products for quotation on exchanges and markets. It is a move that will help to establish Australia as a regional carbon trading hub. The joint venture will enable companies to trade in emission permits under the Australian Emissions Trading Scheme on FEX market structures.^[3]

• Jan. 8, 2008: FEX Acquires 100 percent of Mercari (http://www.mercari.com.au). Mercari Direct had developed preparatory technology which is a patented secure interactive trading system for OTC products will become the platform for the Financial and Energy Exchange (FEX) new OTC products.

• May 11, 2007: FEX will utilize OMX technology, the premium matching engine technology supplier to world exchanges, for its futures market trading engine.

Owners and Key People

The Financial and Energy Exchange ownership is comprised of a consortium of energy, financial market participants, traders, and investors. Shareholders include major mainland Chinese energy groups, NasdaqOMX, AMB Holdings of Western Australia, FEX-China, the Allied Coal group and the private equity group Iron Mountain.

Owners and Key People :

• Brian Price, CEO

References

1. ↑ RTS to offer access to Financial & Energy Exchange (FEX). FEX.
2. ↑ Financial & Energy Exchange chooses Argus coal indices for settlement. FEX.
3. ↑ Macquarie Group and Financial & Energy Exchange launch company to develop environmental markets. FEX.