EEX Suspends Enron From Trading On Spot And Futures Market

On November 29 after the close of trading, the General Management of EEX ordered that the admission of Enron Capital & Trade Resources Ltd., London, for trading in the EEX spot market be suspended with immediate effect. Moreover, Enron Europe Xchange Trading Ltd., London, has been suspended from trading in the EEX futures market with immediate effect. Therefore, no trading will be possible for both companies until further notice.

The suspension has no effect on exchange transactions that have been concluded by Enron with other EEX trading participants nor on the clearinghouse of EEX European Energy Exchange AG. This is due to the existing EEX clearing structure with a Central Counterparty as well as a clearing bank for every trading participant in the futures market and a settlement bank in the spot market. The Central Counterparty guarantees the settlement of all transactions on the exchange and thus assumes the risk of default for the other participants. In the futures market, the respective clearing bank of the trading participants provides the necessary collateral to the clearinghouse. In the spot market, the trading participants furnish the collateral in cash, securities or in the form of a bank guarantee. This structure covers all transactions on the exchange in the present case and any open positions that may be held by Enron at EEX.