Dear Gas Market Clearing Members,
With this information letter KELER CCP Central Counterparty Ltd. (hereinafter: KELER CCP) notifies the Gas Market Clearing Members about the defaults declared on 15 September 2020 and 16 September 2020.
In accordance with Article 5.1.1. of KELER CCP’s General Business Rules (hereinafter: GBR) as of 15 September 2020 at 08:15 a.m. has declared default of AIK Energy Austria GmbH (hereinafter: the Company) due to non-performance of its financial obligations in respect of Balancing Clearing. KELER CCP has declared default of the Company as well as of 16 September 2020 in respect of Balancing Clearing.
Having declared the default as of 15 September 2020, KELER CCP has immediately initiated the application of the legal consequences of default in accordance with the GBR in order to protect market participants, since it has suspended the Company’s clearing right with the notification of FGSZ Ltd. and the respective authorities, and imposed additional financial collateral provision obligation. In order to ensure the smooth execution of financial settlements, KELER CCP ordered the use of financial collaterals in line with Article 6.14.1. of the GBR (default waterfall) as follows.
In relation to the default declared as of 15 September 2020:
- KELER CCP has used the Company’s assets, as its free cash balances and blocked collaterals including its default fund contribution;
- KELER CCP has used its own resources (skin in the game) dedicated to Balancing Clearing;
- KELER CCP has used the default fund (KP KGA) for the remaining amount.
In relation to the default declared as of 16 September 2020, after refilling the own resources funds (skin in the game), KELER CCP has used again its own resources dedicated to the Balancing Clearing, while the financial default had no impact on the default fund (KP KGA) this time.
In relation to the usage of the default fund (KP KGA) as of 15 September 2020, the Chief Executive Officer of KELER CCP is entitled to order the refilling of the default fund in the proportion of the original default fund contributions valid on the day of the usage. KELER CCP will inform the Gas Market Clearing Members individually about the amount of the contribution to be refilled. The contribution shall be fulfilled until the 10th clearing day followed by the order.
A default situation to occur in any market is an undesirable event. At the same time, we would like to emphasize that KELER CCP has the necessary liquidity, the required and usable dedicated capital and its operational capacity to take over and fulfil the obligations of the defaulting party in order to manage the situation in a satisfactory way for the market.
In addition, KELER CCP shall take all the necessary legal steps without delay in order to ensure the financial settlement and to maintain market confidence.
Sincerely,
Babett Pavlics
Chief Executive Officer
KELER CCP Ltd.