Nord Pool Spot AS has investigated possible breaches of the market conduct rules by Lyse Produksjon AS
The Norwegian hydropower plant “Tjodan” is operated by Lyse Produksjon AS and has an installed capacity of 110 MW. After an outage starting on 3 April 2009 the plant resumed operations on 6 April 2009. The resumption of the plant was not disclosed to the market until 19 October 2009. On 7 May 2009 Lyse Produksjon AS sent another urgent market message (UMM) relating to the Tjodan plant, from which it could have been inferred that the plant was back in operation, however this information was not explicit from the UMM. In the period from 6 April 2009 to 7 May 2009, Lyse Produksjon offered the production from Tjodan to the spot market.
Nord Pool Spot AS has regarded information about the resumption of the Tjoldan plant as inside information, as it was deemed to have a potential effect on prices, but was not made public. The recommencement of the plant should have been disclosed through UMM since it related to more than 100MW.
Pursuant to Market Conduct Rules sections 2.3, 3.1 c and 3.5, and in accordance with the recommendation from Market Surveillance, Nord Pool Spot AS has concluded that Lyse Produksjon AS has breached the disclosure requirements and traded in the spot market while holding insider information. In line with the above Lyse Produksjon AS har received a written warning pursuant to Market Conduct Rules section 7.
The fact that the information disclosure was severely delayed and that the insider trading was conducted over an extensive time period was deemed as aggravating circumstances, while it was deemed mitigating that the information was not considered having a significant effect on the price(s) of the relevant products.
With reference also to the recommendation from the Disciplinary Committee of Nord Pool ASA, it should be noted that Nord Pool Spot AS has concluded that it is a requirement for the insider trading prohibition to apply that the relevant information, in each case, is considered to have a potential effect on the price(s) of the applicable product(s). There is however no requirement that the information would have a significant effect on the price(s).
Nord Pool ASA has conducted a parallel investigation relating to the same incident in relation to the derivatives market. Please refer to separate information from Nord Pool ASA in this respect. The recommendation from the Disciplinary Committee of Nord Pool ASA can be found here. (note: Danish language).
Lysaker, 13 October 2010 13:00 CET
For further information please contact Nord Pool Spot:
Siw Hauge, Director communications
phone +47 90 61 59 92