Product Specifications

From December 2007 onwards, Eurex members admitted by EEX are able to access the EEX order book for emissions trading on the common platform used by both exchanges. The following products are available on the common platform for trading from 08:30 until 17:00 CET. OTC Block Trades can be entered until 18:00 CET.

EUA Futures

Contract	Second Period European Carbon Future
Underlying	Delivery or purchase of EU Emission Allowances (EUAs) for the second trading period
Product ID	F2PE
Maturities	Annual futures 2008–2012
Maturity Date	Last exchange day in November
Delivery Date	First settlement day in December
Contract Volume	1,000 EUA (one lot)
Quotation	In EUR/EUA; to two decimal places
Fulfillment	Delivery versus payment

CER Futures

Contract	CER Future
Underlying	Delivery or purchase of Certified Emission Reductions (CERs), excluding credits generated from nuclear power projects, LULUCF and hydro power projects > 20 MW.
Product ID	FCER
Maturities	Annual futures for the following five years
Maturity Date	Last exchange day in November
Delivery Date	First settlement day in December
Contract Volume	1,000 CER (one lot)
Quotation	In EUR/CER; to two decimal places
Fulfillment	Delivery versus payment

Options on EUA Futures

Contract	Second Period European Carbon Option
Underlying	EUA Futures
Product ID	O2PE
Contract Months	European-style Call and Put options for the years 2008 to 2012
Last Trading Day/Expiry Date	Three exchange days before the final trading day of the underlying future
Exercise	Manual exercise until 15:00 CET on the Last Trading Day. In-the-money options will be exercised automatically.
Assignment	At the end of the Post-Trading Period of the exercise day.
Contract Volume	1 EUA Future (one lot)
Quotation	In EUR/EUA; to three decimal places
Fulfillment	Booking of the corresponding futures position at the respective exercise price after the option is exercised

Trading Model

Trading facilities of both EEX and Eurex operate on the very same technical platform. The trading models, market control and supervision procedures, and finally the surveillance tools are similar - sometimes even identical. However, both exchanges operate in a slightly different regulatory environment, where Eurex is regulated and supervised as a financial derivatives exchange and EEX is regulated and supervised as a commodity exchange. However, there are no material differences with respect to membership admission criteria and trader admission criteria. Consequently, a lean admission process has been established allowing members to start trading the cooperation products with minimal administrative effort.

Eurex Trading Members gain seamless access to the trading facilities of EEX via their existing Eurex infrastructure and Eurex GUI. The cooperation products are assigned to all Eurex members that have been admitted by EEX for the cooperation products. In addition, the respective Eurex Clearing Member designated to clear the cooperation products needs to assign the respective product group to the Eurex Trading Member. Once the internal system administrator has assigned the cooperation products and the respective access rights to the individual traders, Eurex traders are able to trade the cooperation products at EEX via their existing Eurex member and trader ID. Eurex traders can use their existing front-end solutions allowing the products to be handled with the same "look and feel" as any other Eurex product.

Trading Times

The following trading and clearing schedule applies for emission products (times are in CET).

Pre-Trading	Opening	Trading	Post-Trading
8.00-8.25	8.25-8.30	8.30-17.00	17.00-18.00

Trading on the exchange is possible during the "Trading" phase while OTC Block Trade registration is possible until the end of the Post-Trading Period. The same trading timeline applies on the Last Trading Day.

Clearing Model

The cooperation products are cleared by both Clearing Houses, whereby ECC is the designated primary CCP (central counterparty) and Eurex Clearing AG acts as secondary or sub-CCP.

Both Clearing Houses operate on the same technical platform - the Eurex® system - and use nearly identical risk management regimes. Even the core business processes of both companies are alike. Further to this, both Clearing Houses operate under the same regulatory and insolvency regime.

As a result, all existing functions and reports are available for transactions in cooperation products and follow the existing formats and standards of ECC AG and Eurex Clearing AG:

Trade Management
Give-up/Take-up
Position Management
Cash Management and Settlement
Risk Management

Eurex's international trading participants are able to clear and to settle trades over existing clearing relationships without additional technical and functional effort. Clearing Members of Eurex Clearing AG can easily extend their Clearing License to the cooperation products. ECC Clearing Members are already admitted to clear cooperation products.

The clearing model foresees an effective clearing relation between ECC and Eurex Clearing AG that enables members of Eurex Clearing AG and ECC to offer clearing services for cooperation products to their customers and to Non-Clearing Members.

Inter-CCP Risk Management is applied to handle the positions between both Clearing Houses. It ensures that members of Eurex Clearing AG are protected against a potential default of an ECC member and vice versa ECC members are protected against a potential default of a member of Eurex Clearing AG.

Cross margining is applied for all CO2 derivatives: by offsetting of opposing risks within a group of instruments with similar risk characteristics, members benefit from optimized usage of their collateral.

Delivery Model

Physical settlement of expired futures positions is carried out by ECC. As a specialized Clearing House experienced in the physical delivery of commodities, ECC offers a fully integrated delivery management for spot and derivatives transactions. Furthermore ECC offers the fastest physical delivery process for emissions in today's market environment and contributes to the reduction of settlement risks in the delivery chain of trading participants.

Trading participants are required to pre-deposit Emission Allowances on the ECC settlement account at the German registry of DEHSt (Deutsche Emissionshandelsstelle) for the expired futures position at least one settlement day before delivery. At maturity, futures positions are booked out of the clearing system and provided to ECC for the creation of delivery instructions. The payment instruction out of the DVP instructions is created and incorporated into the standard cash settlement process for Bundesbank payments.

Managing Delivery Risks
If a buying trading participant fails to pay for the physical delivery on the delivery day, then ECC freezes the pending delivery instructions of the trading participant to cover possible close-out losses, if default of a Clearing Member caused the failure to pay. If payment takes place delayed (technical default), ECC releases the frozen Emission Allowances and continues with the settlement process.

If a selling trading participant is late or does not deliver, the following process applies:

1. Buy-in Process
The late seller remains obliged to deposit the required Emission Allowances into the ECC settlement account at the registry or to close-out delivery obligations by a counter-trade on the spot market as soon as possible. Should a selling trading participant fail to meet its obligations, ECC buys-in the missing Emission Allowances via EEX on the spot market in one or more buy-in attempts. The first buy-in is triggered five settlement days after the failed delivery date (d+5), the latest buy-in ten settlement days after the failed delivery date (d+10). The cost for the buy-in and a contractual penalty is charged to the failed seller.

2. Final Cash Settlement
If the buy-in process is not successful, ECC applies a cash settlement on d+10. The cost for this cash settlement is charged to the failed seller. In addition, a contractual penalty is inflicted on the trading participant in default.

Pricing

We offer an attractive price model for trading and clearing of our cooperation products.

Table: Fee Overview

Trading Fee	EUR 2 per lot
OTC Trade Registration Fee	EUR 2 per lot
Clearing Fee	EUR 1 per lot
Physical Delivery Fee	-

Fee Rebates

EEX and Eurex offer the following trading fee rebates in 2008:

EUA Futures

50 per cent reduction for order book and OTC transactions until the end of 2008.
75 per cent reduction for OTC transactions for legacy trades during the second quarter of 2008.

CER Futures

No fees for order book and OTC transactions until the end of 2008.

EUA Options

50 per cent reduction for order book and OTC transactions until the end of 2008.

Fee Rebates for Market Makers

If Market Makers meet their performance criteria, they receive full refund of their trading fees.In addition, the alliance offers special “Market Maker Packages“ if Market Makers actively quote two cooperation products.