Talk:Unauthorised Transfers - Emissions Annex Provision

EFET

“Affected Allowance” means an Allowance which is or is alleged to have been the subject of an Unauthorised Transfer as confirmed by an Appropriate Source; “Appropriate Source” means any ‘competent authority’ and/or the ‘Central Administrator’ (as those terms are defined in the Registries Regulation), National Administrator or any other authority having power pursuant to the Directive and/or the Registries Regulation to block, suspend, refuse, reject, cancel or otherwise affect the Transfer (whether in whole or in part) of Allowances, any recognized law enforcement or tax authorities of a Member State, European Anti-fraud Office of the European Commission or Europol; “Encumbrance Loss Amount” means an amount reasonably determined by the Buyer in good faith to be its total losses and costs in connection with an Individual Contract including, but not limited to, any loss of bargain, cost of funding or, at the election of the Buyer but without duplication, loss or costs incurred as a result of its terminating, liquidating, obtaining or re-establishing any hedge or related trading position. Such amount includes losses and costs in respect of any payment already made under an Individual Contract prior to the delivery of the written notice by the Buyer and the Buyer's legal fees and out-of-pocket expenses but does not include Excess Emissions Penalty or any amount which the Buyer must pay to a third party in respect of any such penalty payable to any other party (or Relevant Authority) by that third party. The Parties agree that in circumstances where there was a breach of the No Encumbrances Obligation by the Seller caused by the Transfer of an Affected Allowance, the Buyer will be entitled to recover any losses arising out of or in connection with any claim, demand, action or proceeding brought against the Buyer by a third party consequent upon the Transfer by the Buyer of an Affected Allowance Transferred to it by the Seller under an Individual Contract; “Unauthorised Transfer” means the Transfer by debiting of any Allowance from an account holder's Holding Account and the crediting of a Holding Account of another person, where such Transfer is not initiated by the relevant authorised representative or additional authorised representative (as referred to in the Registries Regulation) of the first account holder; (d) Where a breach of the No Encumbrances Obligation is caused by the Transfer of an Affected Allowance, the Seller shall be liable for the Encumbrance Loss Amount if, at the date it first acquired, received or purchased such Affected Allowance, it was not acting in good faith; otherwise, the Seller shall only be liable for the Encumbrance Loss Amount (without prejudice to any other defences available to the Seller including, but not limited to, any defences of statutes of limitation or similar), if: (i) the Buyer, whether or not the holder of such Affected Allowance, who is subject to a claim of the Original Affected Party, has, in order to resist or avoid any Encumbrance Loss Amount from arising, used its best endeavours to defend such a claim in respect of that Affected Allowance (including, if available, by relying on Article 40 of the Registries Regulation or any equivalent legal principle under applicable national law) and was unsuccessful (other than for reasons of its own lack of good faith); or (ii) the Buyer, whether or not the holder of such Affected Allowance, who acted in good faith in respect of its purchase of such Affected Allowance and who is subject to a claim of a third party (other than the Original Affected Party) in respect of that Affected Allowance, has used all reasonable endeavours to mitigate the Encumbrance Loss Amount.