New Developments
The Natural Gas Futures Market Operation Procedures and Principles (“VGPUE“) was published in the Official Gazette on March 12, 2021 and entered into force on the same date in accordance with the Energy Market Regulatory Board Decision No. 10046 dated February 25, 2021.
The VGPUE was stipulated to be issued under the Regulation Amending the Organized Natural Gas Wholesale Market Regulation, which was published in the Official Gazette on January 12, 2021. You may find our Legal Alert regarding the regulation here.
Significant Provisions in VGPUE
Functioning of the market: Tradings will be based on delivery periods and all open contracts will be traded according to the continuous trading method during the session. Matching offers will oblige the market participants to physically deliver or receive the natural gas to or from the transmission system during the delivery period. Offers that do not match can be updated in accordance with the VGPUE. The physical delivery obligation of the market participant will be eliminated when an open position is closed before the respective contract expires.
Guarantee obligation: The natural gas futures market guarantees consist of the initial guarantee, and the guarantees for the financial period and the physical period. The initial guarantee is determined as TRY 150,000. The guarantees for the financial period and the physical period will be determined by the calculation methods foreseen in the VPGUE.
Default guarantee account:
- The default guarantee account contribution of a market participant cannot be less than the fixed contribution amount. Market participants’ fixed contribution is determined as TRY 100,000. The market operator, Enerji Piyasaları İşletme A.Ş. (“EPİAŞ“), can update this amount, taking into account market conditions.
- EPİAŞ will determine its own contribution amount, and will not be required to make additional contribution within the relevant year even if its contribution is used.
- Market participants who causes the use of the EPİAŞ contribution will be charged interest at the rate determined in accordance with Article 51 of the Law on the Procedure for the Collection of Public Receivables No. 6183.
- Market participants may fulfil their default account contribution obligations in Turkish lira, foreign currencies (USD and EUR) or with Government Domestic Bonds issued by the Ministry of Treasury and Finance, provided that they are bearer bonds. At least 50% of the total contribution must be cash in Turkish lira.
Transfer and pledge of receivables: Market participants can only transfer or pledge their rights and receivables from EPİAŞ with EPİAŞ’ approval.
Conclusion
The VGPUE clarified details of the regulations on the natural gas futures market.
