Settlement Disruption Event - Emissions Annex Provision

EU Emissions Allowance Transaction Annex to the 2005 ISDA Commodity Definitions
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Emissions trading documentation

ISDA: EU Anatomy • EU Wikitext • EU Nutshell (premium) • UK Anatomy • UK Wikitext (to be merged into EU Anatomy)
IETA: IETA Master Agreement • IETA Wikitext • IETA Nutshell (premium)

EFET: EFET Allowances Appendix • EFET Allowances Wikitext • EFET Nutshell (premium)

Section Settlement Disruption Event in a Nutshell™

Use at your own risk, campers!

Settlement Disruption Event: Something beyond the affected party’s control that, having used all reasonable efforts, it cannot overcome and which makes it impossible to perform its obligations to deliver or to accept Allowances under an EU Emissions Allowance Transaction. The following will not count as Settlement Disruption Events if they cause an inability to deliver Allowances in the affected party’s Specified Holding Account: (a) the low or non-allocation of Allowances by any state; (b) a Member State or Central Administrator not replacing Third Compliance Period Allowances with Fourth Compliance Period Allowances; or (c) any party’s failure of a party to procure sufficient Allowances to meet its delivery obligations. Something which otherwise would be a Settlement Disruption Event and a Suspension Event, will count as a Suspension Event and not a Settlement Disruption Event. view template

Full text of Section Settlement Disruption Event

Settlement Disruption Event: Means an event or circumstance beyond the control of the party affected that cannot, after the use of all reasonable efforts, be overcome and which makes it impossible for that party to perform its obligations either to deliver or to accept Allowances in accordance with the terms of an EU Emissions Allowance Transaction. For the avoidance of doubt, the inability of a party to deliver Allowances as a result of insufficient Allowances in the relevant Specified Holding Account, whether caused by the low or non-allocation of Allowances by a Member State or any other state, the delay or failure of a Member State or Central Administrator to replace Allowances of the Third Compliance Period with Allowances for the Fourth Compliance Period, or the failure of a party to procure sufficient Allowances to meet its delivery obligations, shall not constitute a Settlement Disruption Event. This is not an exhaustive list of events which will not constitute a Settlement Disruption Event and is provided for the avoidance of doubt only. If an event or circumstance which would otherwise constitute or give rise to a Settlement Disruption Event also constitutes a Suspension Event, it will be treated as a Suspension Event and will not constitute a Settlement Disruption Event. view template

Comparison

See our natty emissions comparison table between the IETA, EFET and ISDA versions of emissions trading docs

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