Contracts for Difference (Standard Terms) Regulations 2014
What this means for your business
- Applies to
- United Kingdom
- On this page
- 7 compliance obligations, 1 practical guide
What you must do
7 compliance obligations under this legislation.
Management duties 2
Assess CFD term modifications and publish notice online
If your business is the CFD counterparty you must review any proposed change to the standard terms of a Contracts‑for‑Difference and decide, using the listed tests, that the change is more than a minor tweak. When the Secretary of State sends you a notice under paragraph 6, you must put that notice on your website as soon as reasonably practicable.
Make CFD offer and notify parties within set time‑frames
When you receive a CFD notification you must sign and send the required copies of the contract to the eligible generator within 10 working days. Once the generator returns the signed copy, you must promptly confirm receipt to them and, as soon as reasonably practicable, tell the delivery body that the CFD has been entered.
Notifications 1
Notify generator and delivery body when a CFD offer lapses
If you are the CFD counterparty and you do not get a signed contract back within 10 working days of making an offer, the offer automatically lapses. When that happens you must promptly inform the generator and the delivery body that the offer has lapsed.
Other requirements 1
Include required clauses in CFD standard terms
If you issue standard terms for a contracts‑for‑difference (CFD) arrangement, you have to spell out exactly how payments work when the strike price and reference price differ, how generation and reference prices are calculated, and the rules around payments, capacity, force majeure, amendments, termination and dispute resolution. It is a detail‑heavy requirement that must be satisfied before signing the CFD.
Record keeping 1
Maintain and publish a register of CFDs
If your business is a CFD counterparty you must give every CFD a unique ID, keep a detailed register of each contract, keep the information accurate and update some items each quarter. The register has to be published on your website, but you may withhold certain sensitive details after giving the generator a chance to comment.
Reporting and filing 2
Notify applicants of acceptance or refusal of CFD term modification
When your business receives a request to change the standard terms of a Contracts‑for‑Difference (CFD) product, you must tell the applicant whether you accept or reject the request. The notice has to be sent at least five working days before the application’s closing date and must include either the agreed changes or the reasons for refusal.
Provide information to the Secretary of State on CFD standard terms revisions
If the government asks your firm for information or advice about new or changed Contracts‑for‑Difference standard terms, you must respond promptly. Your business needs to be ready to supply the required details and keep a record of what was provided and when.
Practical guidance
Our guides explain how to comply with the requirements above.
Sections and provisions
14 classified provisions from this legislation.