News October-December 2003
News Release: October 22, 2003 | View Printable PDF Version |
Docket Numbers: RM02-14-000, RM02-14-001 |
COMMISSION FINALIZES RULES FOR CASH MANAGEMENT PROGRAMS;
GREATER FINANCIAL TRANSPARENCY TO RESULT
The Federal Energy Regulatory Commission today is amending its regulations
to implement filing and notification requirements for FERC-regulated
entities that participate in cash management programs. This action
will provide the Commission with additional financial transparency
of these arrangements and aid the Commission in its oversight and
market monitoring responsibilities.
Cash management programs include all agreements under which funds
in excess of the daily needs of the FERC-regulated entity, along
with the excess funds of the entity’s parent, affiliated
and subsidiary companies, are concentrated, consolidated, or otherwise
made available for use by other entities within the corporate
group. Such programs concentrate affiliates’ cash assets
in joint accounts for the purpose of providing financial flexibility
and lowering the cost of borrowing.
Today’s final rule, among other things, requires FERC-regulated
entities to file their cash management agreements with the Commission
and to notify the Commission within 45 days after the end of each
calendar quarter when their proprietary capital ratio drops below
30 percent, and when it subsequently returns to or exceeds 30
percent.
In addition to the interim rule, the Commission issued a Notice
of Proposed Rulemaking (NOPR) in August 2002.
Today’s regulations are effective 30 days after publication
in the Federal Register.
R-03-40
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