Template:Nutshell EUA Annex (d)(ii)(1): Difference between revisions

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{{euaprov|(d)(ii)(1)}} '''{{eqderivprov|Failure to Deliver by Delivering Party}}'''<br>
{{euaprov|(d)(ii)(1)}} '''{{euaprov|Failure to Deliver by Delivering Party}}'''<br>
If the failure to deliver occurs other than following {{euaprov|Receiving Party}}’s failure to observe the {{euaprov|Requirements under the Scheme}}, an {{euaprov|Illegality}}, a {{euaprov|Settlement Disruption Event}}, a {{euaprov|Suspension Event}} or {{euaprov|Abandonment of Scheme}}, the {{euaprov|Payment Date}} will be postponed and {{euaprov|Receiving Party}} may by notice require {{euaprov|Delivering Party}} to remedy the failure and:<br>
If {{euaprov|Delivering Party}} fails to deliver ''other than'' due to {{euaprov|Receiving Party}}’s breach of {{euaprov|Scheme Requirements}}, {{euaprov|Illegality}}, a {{euaprov|Settlement Disruption Event}}, a {{euaprov|Suspension Event}} or {{euaprov|Abandonment of Scheme}}, the {{euaprov|Payment Date}} will be postponed, {{euaprov|Receiving Party}} may give notice requiring {{euaprov|Delivering Party}} to remedy the failure and:<br>
:(A) '''{{euaprov|Failure to Deliver Remedied}}''': If {{euaprov|Delivering Party}} remedies the failure by the {{euaprov|Final Delivery Date}}: <br>
:(A) '''{{euaprov|Failure to Deliver Remedied}}''': If {{euaprov|Delivering Party}} remedies the failure by the {{euaprov|Final Delivery Date}}: <br>
::(X) when determining the {{euaprov|Payment Date}}, the {{euaprov|Delivery Date}} will be the date of actual delivery:  
::(X) when determining the {{euaprov|Payment Date}}, the {{euaprov|Delivery Date}} will be the date of actual delivery:  
:::(i) '''{{euaprov|Allowance Forward Transaction}}s''': {{euaprov|Receiving Party}} must pay {{euaprov|Delivering Party}} the {{euaprov|Allowance Purchase Price}} multiplied by the {{euaprov|Number of Allowances}} on the {{euaprov|Payment Date}}  
:::(i) '''{{euaprov|Allowance Forward Transaction}}s''': {{euaprov|Receiving Party}} must pay ''{{euaprov|Allowance Purchase Price}} x {{euaprov|Number of Allowances}}'' on the {{euaprov|Payment Date}}  
:::(ii) '''{{euaprov|Allowance Option Transaction}}s''': {{euaprov|Receiving Party}} must pay {{euaprov|Delivering Party}} the {{euaprov|Allowance Strike Price}} multiplied by the number of {{euaprov|Allowances to be Delivered}} on the {{euaprov|Payment Date}}; and
:::(ii) '''{{euaprov|Allowance Option Transaction}}s''': {{euaprov|Receiving Party}} must pay ''{{euaprov|Allowance Strike Price}} x number of {{euaprov|Allowances to be Delivered}}'' on the {{euaprov|Payment Date}}; and
::(Y) {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party}} on the {{euaprov|Payment Date}} (determined as above) interest on the number of {{euaprov|Allowances}} due but not delivered on the {{euaprov|Delivery Date}} multiplied by the {{euaprov|Allowance Purchase Price}} (for an {{euaprov|Allowance Forward Transaction}}) or the {{euaprov|Allowance Strike Price}} (for an {{euaprov|Allowance Option Transaction}}) from the original {{euaprov|Delivery Date}} to the actual delivery date at the {{euaprov|Default Rate}}.<br>
::(Y) On the same {{euaprov|Payment Date}}, {{euaprov|Delivering Party}} must pay interest at the {{euaprov|Default Rate}} on ''number of undelivered {{euaprov|Allowances}} on the {{euaprov|Delivery Date}} x relevant {{euaprov|Allowance Purchase Price}}/{{euaprov|Allowance Strike Price}}'' from the original {{euaprov|Delivery Date}} to the actual delivery date .<br>
:(B) '''{{euaprov|Failure to Deliver Not Remedied}}''': If the failure is not so remedied:<br>
:(B) '''{{euaprov|Failure to Deliver Not Remedied}}''': If the failure is not remedied:<br>
::(X) if “{{euaprov|Excess Emissions Penalty}}” does not apply, or if it does, but the {{euaprov|Delivery Date}} does not fall within the specified {{euaprov|EEP Risk Period}}, {{euaprov|Receiving Party}} may by notice terminate the parties’ obligations under “{{euaprov|Physical Settlement}}” and {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party}} {{euaprov|Receiving Party’s Replacement Cost}} (if positive) on the next {{euaprov|Business Day}}, adjusted for any amounts already previously paid by {{euaprov|Receiving Party}} to {{euaprov|Delivering Party}} (other than {{euaprov|Premium}} on an {{euaprov|Allowance Option Transaction}}) under the {{euaprov|EU Emissions Allowance Transaction}}; or
::(X) '''No {{euaprov|Excess Emissions Penalty}}''': If “{{euaprov|Excess Emissions Penalty}}” does not apply, or the {{euaprov|Delivery Date}} falls outside the {{euaprov|EEP Risk Period}}, {{euaprov|Receiving Party}} may by notice terminate the parties’ “{{euaprov|Physical Settlement}}” obligations and {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party’s Replacement Cost}} (if positive) on the next {{euaprov|Business Day}}, adjusted for any amounts it has already paid to {{euaprov|Delivering Party}} (other than {{euaprov|Premium}} on {{euaprov|Allowance Option Transaction}}s); or
::(Y) if “{{euaprov|Excess Emissions Penalty}}” applies and the {{euaprov|Delivery Date}} falls within any specified {{euaprov|EEP Risk Period}}, {{euaprov|Receiving Party}} may by notice terminate the parties’ obligations under “{{euaprov|Physical Settlement}}” and {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party}} {{euaprov|Receiving Party’s Replacement Cost}} (if positivem, and where it applies) on the Business Day following the day on which {{euaprov|Receiving Party}} can effect a {{euaprov|Buy-In}}, or the first Business Day following the day on which {{euaprov|Receiving Party}} is can purchase {{euaprov|Allowances}} under paragraph (2)(A)(II)(Y) of {{euaprov|Receiving Party’s Replacement Cost}}, if and to the extent that paragraph applies, in either case adjusted to take into account any amount previously paid (other that any {{euaprov|Premium}} on an {{euaprov|Allowance Option Transaction}}); or
::(Y) '''{{euaprov|Excess Emissions Penalty}} applies''': If “{{euaprov|Excess Emissions Penalty}}” applies and the {{euaprov|Delivery Date}} falls within any specified {{euaprov|EEP Risk Period}}, {{euaprov|Receiving Party}} may by notice terminate the parties’ “{{euaprov|Physical Settlement}}” obligations and {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party’s Replacement Cost}} (if positive, and where it applies) on the {{euaprov|Business Day}} after {{euaprov|Receiving Party}} can effect a {{euaprov|Buy-In}}, or otherwise purchase {{euaprov|Allowances}}, adjusted to account for amounts it has previously paid (other than {{euaprov|Premium}} on {{euaprov|Allowance Option Transaction}}s); or
::(Z) if “Failure to Deliver (Alternative Method)” is specified to be applicable in the Annex to this Part [7] or the {{euaprov|Confirmation}} for the relevant {{euaprov|EU Emissions Allowance Transaction}}:
::(Z) '''{{euaprov|Failure to Deliver (Alternative Method)}}''': If “{{euaprov|Failure to Deliver (Alternative Method)}}” applies:
:::(aa) {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party}}, on the first succeeding Business Day, an amount determined in accordance with paragraph (3) of {{euaprov|Receiving Party’s Replacement Cost}} (if a positive number), adjusted to take into account any amount previously paid (which, for the avoidance of doubt, shall not include any Premium paid by the Buyer in respect of an {{euaprov|Allowance Option Transaction}}) by {{euaprov|Receiving Party}} to {{euaprov|Delivering Party}} in respect of the relevant {{euaprov|EU Emissions Allowance Transaction}}, and upon payment of such amount, Delivering Party’s obligation to deliver to {{euaprov|Receiving Party}} the {{euaprov|Allowances to be Delivered}} shall be fully discharged and terminated; and
:::(aa) on the next {{euaprov|Business Day}} {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party’s Replacement Cost}} (if positive), adjusted to account for amounts previously paid (other than {{euaprov|Premium}} on {{euaprov|Allowance Option Transaction}}s), and upon payment, {{euaprov|Delivering Party}}’s delivery obligation will be fully discharged; and
:::(bb) if “{{euaprov|Excess Emissions Penalty}}” is specified to be applicable in the Annex to this Part [7] or the Confirmation for the relevant {{euaprov|EU Emissions Allowance Transaction}}, {{euaprov|Delivering Party}} must pay {{euaprov|Receiving Party}} the amount, if any, determined in accordance with the provisions of Part [7] (d)(xi)(Failure to Deliver (Alternative Method) – EEP Applicable) below on the date determined in accordance with those provisions. <br>
:::(bb) if “{{euaprov|Excess Emissions Penalty}}” applies, {{euaprov|Delivering Party}} must pay any amount determined under “{{euaprov|Failure to Deliver (Alternative Method) – EEP Applicable}}”. <br>

Latest revision as of 08:05, 19 July 2022

(d)(ii)(1) Failure to Deliver by Delivering Party
If Delivering Party fails to deliver other than due to Receiving Party’s breach of Scheme Requirements, Illegality, a Settlement Disruption Event, a Suspension Event or Abandonment of Scheme, the Payment Date will be postponed, Receiving Party may give notice requiring Delivering Party to remedy the failure and:

(A) Failure to Deliver Remedied: If Delivering Party remedies the failure by the Final Delivery Date:
(X) when determining the Payment Date, the Delivery Date will be the date of actual delivery:
(i) Allowance Forward Transactions: Receiving Party must pay Allowance Purchase Price x Number of Allowances on the Payment Date
(ii) Allowance Option Transactions: Receiving Party must pay Allowance Strike Price x number of Allowances to be Delivered on the Payment Date; and
(Y) On the same Payment Date, Delivering Party must pay interest at the Default Rate on number of undelivered Allowances on the Delivery Date x relevant Allowance Purchase Price/Allowance Strike Price from the original Delivery Date to the actual delivery date .
(B) Failure to Deliver Not Remedied: If the failure is not remedied:
(X) No Excess Emissions Penalty: If “Excess Emissions Penalty” does not apply, or the Delivery Date falls outside the EEP Risk Period, Receiving Party may by notice terminate the parties’ “Physical Settlement” obligations and Delivering Party must pay Receiving Party’s Replacement Cost (if positive) on the next Business Day, adjusted for any amounts it has already paid to Delivering Party (other than Premium on Allowance Option Transactions); or
(Y) Excess Emissions Penalty applies: If “Excess Emissions Penalty” applies and the Delivery Date falls within any specified EEP Risk Period, Receiving Party may by notice terminate the parties’ “Physical Settlement” obligations and Delivering Party must pay Receiving Party’s Replacement Cost (if positive, and where it applies) on the Business Day after Receiving Party can effect a Buy-In, or otherwise purchase Allowances, adjusted to account for amounts it has previously paid (other than Premium on Allowance Option Transactions); or
(Z) Failure to Deliver (Alternative Method): If “Failure to Deliver (Alternative Method)” applies:
(aa) on the next Business Day Delivering Party must pay Receiving Party’s Replacement Cost (if positive), adjusted to account for amounts previously paid (other than Premium on Allowance Option Transactions), and upon payment, Delivering Party’s delivery obligation will be fully discharged; and
(bb) if “Excess Emissions Penalty” applies, Delivering Party must pay any amount determined under “Failure to Deliver (Alternative Method) – EEP Applicable”.
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