Library / Gas Trading and Settlement Regulations 2023
Gas Trading and Settlement Regulations 2023

Page 15 of 31
B 157
PART V — GENERAL OBLIGATIONS OF GAS EXCHANGE AND CLEARING HOUSE
29.  A gas exchange shall use the services of a clearing house authorised
by the Authority for clearing and settlement of its trades.
30.  A gas exchange shall avail the service of a clearing house pursuant
to an agreement in writing between the parties stipulating their rights and
obligations, the conditions for admission of gas volumes for clearing and
settlement, risk management measures, charges for clearing and settlement
and other incidental and consequential matters.
31.—(1)  A clearing house or gas exchange shall establish and maintain
a Settlement Guarantee Fund, to guarantee the settlement of trades executed
on the gas exchange :
Provided that in case a gas exchange enters into an arrangement with more
than one clearing house, then it shall enter into a multi-partite agreement in
writing with such clearing houses to ensure interoperability among the clearing
houses.
(2)  Where a member of a gas exchange or clearing house fails to honour
its settlement obligations, the Settlement Guarantee Fund shall be utilised to
complete the settlement.
32.—(1) The contribution to the Settlement Guarantee Fund shall be
made by the gas exchange, the clearing house and all members of gas exchange
or clearing house, in the manner specified by the gas exchange or the clearing
house.
(2) In case of shortfall in the Settlement Guarantee Fund, the clearing
house and the gas exchange shall replenish the Settlement Guarantee Fund to
the threshold level as may be specified in these Regulations or by the Authority.
(3) The components of the Settlement Guarantee Fund are —
(a)  minimum balance of  USD500,000 in the Settlement Guarantee
Fund at the start of the exchange which shall comprise of the base minimum
capital of all the members and the balance, if any, contributed by a gas
exchange or clearing house ;
(b) quarterly contribution to the Settlement Guarantee Fund by the gas
exchange or clearing house, which is equal to 5% of the sum total of the
gross revenue of the gas exchange or clearing house ;
(c) returns or any other income accruing on all investments of the
Settlement Guarantee Fund, including the base minimum capital ; and
(d) all penalties charged by the gas exchange or clearing house.
Clearing and
settlement
of  trades
Agreement
between gas
exchange and
clearing
house
Settlement
Guarantee
Fund
Contribution
to the
Settlement
Guarantee
Fund