Status: Please note you should read all Brexit changes to the FCA Handbook and BTS alongside the main FCA transitional directions. Where these directions apply the 'standstill', firms have the choice between complying with the pre-IP completion day rules, or the post-IP completion day rules. To see a full list of Handbook modules affected, please see Annex B to the main FCA transitional directions.

REC 3.27 RAP auction clearing price and adjustment of the auction calendar

REC 3.27.1G
  1. (1)

    1In accordance with regulation 7(1)(a) of the UK auctioning regulations, the auction clearing price is the price of the bid at which the sum of the volumes bid matches or exceeds the volume of allowances auctioned.

  2. (2)

    A RAP must decide on the methodology to determine the auction clearing price and the secondary market price in circumstances where the auction clearing price (determined in accordance with (1)) would be significantly below the price on the secondary market prevailing during and immediately before the bidding window, taking into account the short-term volatility of the price of allowances over a defined period preceding the auction. In determining that methodology, the RAP must treat the price of the bid which matches or exceeds the secondary market price as the auction clearing price (regulations 7(1)(b), 7(2) and 7(4) of the UK auctioning regulations).

  3. (3)

    In accordance with regulation 7(4) of the UK auctioning regulations, a RAP is required to notify the FCA the methodology in (2) before an auction is started.

  4. (4)

    In accordance with regulation 7(6) of the UK auctioning regulations, a RAP is required to notify the FCA without delay if, in between two bidding windows, it modifies the methodology in (2).

  5. (5)

    The notifications referred to in REC 3.27.1G(3) and (4) should be undertaken in accordance with REC 3.2.2R.

REC 3.27.2G