Over-the-counter market

Improving hedge disclosure obligation requirements

Upcoming Open Closed Decision
View submissions Submissions closed 9 August 2023
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Consultation

This consultation sought industry feedback on issues and high-level options to improve the hedge disclosure obligation (HDO) requirements. The HDO requirements facilitate the market in over-the-counter risk management contracts. They require participants who have entered certain risk management contracts to disclose specified information. The HDO requirements were introduced in 2009 under the Authority’s predecessor, the Electricity Commission.

We've now published a decision paper outlining the Code amendments we will be implementing to improve the transparency of risk management products and competition in the contracts market, for the long-term benefit of consumers.

A well-functioning contracts market enables participants to effectively hedge against spot price volatility and participants are increasingly relying on the contracts market to manage their risk.

The contracts market has materially changed over the past few years and a growing number of risk management contracts are not captured by the HDO requirements. A further concern is that the information specified in the Code for each contract type is insufficient to enable effective risk management.

We would like to thank all those who provided input on the questions listed in our consultation paper.

Decision paper- HDO Improvements

Decision paper- HDO Improvements
Consultation paper - Improving Hedge Disclosure Obligations

Consultation paper - Improving Hedge Disclosure Obligations

Submissions

Download all submissions (.zip)