MP076 Pursuing Non-Payment in Events of Default

Proposer Simon Trivella
Lead Analyst Joe Hehir
Date raised 10/05/2019
StageImplemented
Implementation date 29/11/2019 (November 2019 SEC Release)
Latest update This modification was implemented on 29 November 2019 as part of the November 2019 SEC Release.

What is the issue?

In practice the wording of Section J2.6 ‘Pursuing Non-Payment’ means that the Data Communications Company (DCC) will keep the SEC Panel updated on matters regarding pursuing non-payment as well as allowing the Panel to express their views, but ultimately the DCC must decide what they consider to be the best course of action (unless the Panel say it is no longer worthwhile to try and recover the costs). There is a general concern that the way that payment defaults are currently handled could affect the outcome of future defaults. The Panel seek to eliminate the possibility for SEC Parties to pay socialised costs as far as possible.

The full Draft Proposal can be found here.

What is the solution?

MP076 proposes to amend Section J2.6(b) by obliging the DCC to take all reasonable steps to gain agreement from the Panel for their approach to pursuing non-payment, as well as simply consulting with the Panel as under the current arrangements. The DCC could still choose not to take the Panel’s advice but would have to show why they did so and that they took all reasonable steps to attempt to gain agreement from the Panel. This will provide clarity for the Panel as well as the DCC in how to manage such scenarios in future, as well as limit the risk of increased costs to be socialised amongst SEC Parties in Events of Default by ensuring action is taken swiftly enough to prevent this from happening.

Who is impacted?

DCC

What SEC documents are affected?

Section J 'Charges'

Timeline

10 May 2019
Draft Proposal raised
14 Jun 2019
Converted to Modification Proposal
03 Jul 2019
15 Jul 2019
to
29 Jul 2019
12 Aug 2019
to
03 Sep 2019
Modification Report Consultation
19 Sep 2019
Change Board vote

Modification documents

MP076 Authority decision
24/10/2019
MP076 Change Board vote
18/09/2019
MP076 Modification Report
18/09/2019
MP076 Modification Report Consultation responses
04/09/2019
MP076 Modification Report Consultation
12/08/2019
MP076 legal text
02/08/2019
MP076 Refinement Consultation responses
30/07/2019
MP076 Refinement Consultation
15/07/2019
MP076 July 2019 Working Group meeting summary
12/07/2019
DP076 problem statement
19/06/2019
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