Over-the-counter market

Improving hedge disclosure obligation requirements

Upcoming Open Closed Decision
Make a submission Submissions closed 9 August 2023
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Consultation

We’re seeking 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.

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.

However, the current HDO requirements are not fit for purpose to support effective risk management. 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 welcome views from all interested parties on the questions listed in our consultation paper. This feedback will be used to develop the next stage of preferred options for future consultation.

Consultation paper - Improving Hedge Disclosure Obligations

Consultation paper - Improving Hedge Disclosure Obligations

Submissions

Download all submissions (.zip)

Make a submission

We welcome views from all interested parties. A full list of questions we would like you to answer in your submission can be found in Appendix B of the consultation paper.

Please email submissions to wholesaleconsultation@ea.govt.nz by 5pm on 9 August 2023.