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Enron Mail |
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Results of discussions so far:
London: the principal for the London FX desk internal transactions is RMT acting through its agent EEFT Japan: we are still in discussion with Susan Musch and jeff Blumenthal, but in a nutshell it is looking like the principal for the Tokyo desk transactions will need to be Enron Japan KK, and the transaction will then need to be backed into RMT (margin to be left in Enron japan KK). Please note this is still an issue in progress and a further discussion is scheduled for tomorrow. REgards Janine Dale Neuner 18/10/2000 18:24 To: Janine Juggins/LON/ECT@ECT cc: Brent Hendry/NA/Enron@Enron, Sara Shackleton/HOU/ECT@ECT, William Stuart/HOU/ECT@ECT, Shane Dallmann/LON/ECT@ECT, Robert B Cass/HOU/ECT@ECT, Melba Lozano/HOU/ECT@ECT, Sheri Thomas/HOU/ECT@ECT, Jennifer deBoisblanc Denny/HOU/ECT@ECT Subject: Re: FX Issues Janine: Please provide an update of your progress on this issue. Also, if the research being conducted is specific to the relationship between Enron Japan Corp and RMT, can we explore the possiblility of rolling this product out for USD and ECU and only allow RMT and EEFT as agent for RMT to trade, then add JPY and EJC as agent for RMT once your examination is complete? Stuart and Shane: could either or both of you please provide me with the trading hours that each of the Tokyo, London, and Houston trading desk will be offering these Product online, to include any time overlaps or time gaps. Also, please take a look at the Products I've created in TEST and see if they meet your expectations. Dale Janine Juggins 10/12/2000 08:36 AM To: Dale Neuner/HOU/ECT@ECT cc: Amita Gosalia/LON/ECT@ECT, Justin Boyd/LON/ECT@ECT, Brent Hendry/NA/Enron@Enron, Sara Shackleton/HOU/ECT@ECT, William Stuart/HOU/ECT@ECT, Jeff Blumenthal/HOU/ECT@ECT, Shane Dallmann/LON/ECT@ECT, Jason Althaus/Corp/Enron@Enron, Mark Dilworth/LON/ECT@ECT, Sheri Thomas/HOU/ECT@ECT, Jennifer deBoisblanc Denny/HOU/ECT@ECT, Robert B Cass/HOU/ECT@ECT, Melba Lozano/HOU/ECT@ECT Subject: Re: FX Issues Tax: The Enron entity executing the FX transaction as principal is ENA. However, note that for tax/legal the FX desk in London is run by Enron Europe Finance & Trading Limited ("EEFT") as agent for ENA. Our position is that ENA does not have a place of business in London. Therefore all the transactions managed by the London FX desk are arranged by EEFT as agent for ENA. Because of this there is a need to identify which FX desk arranged the transaction and a possible solution to this is to have separate logins and logoffs for each FX desk during their hours of responsibility. This would enable transaction reports to be run which identify those transactions which took place during the period for which each FX desk was responsible for managing the FX positions. Regards Janine Dale Neuner 11/10/2000 22:31 To: Amita Gosalia/LON/ECT@ECT, Justin Boyd/LON/ECT@ECT, Brent Hendry/NA/Enron@Enron, Sara Shackleton/HOU/ECT@ECT, William Stuart/HOU/ECT@ECT, Jeff Blumenthal/HOU/ECT@ECT, Shane Dallmann/LON/ECT@ECT, Jason Althaus/Corp/Enron@Enron, Mark Dilworth/LON/ECT@ECT, Janine Juggins/LON/ECT@ECT cc: Sheri Thomas/HOU/ECT@ECT, Jennifer deBoisblanc Denny/HOU/ECT@ECT, Robert B Cass/HOU/ECT@ECT, Melba Lozano/HOU/ECT@ECT Subject: FX Issues This e-mail is admittedly long, so I have classified the issues: Legal/Tax Issue: I have been told by the FX group here in Houston that London traders are able to act on the behalf of the US FX Desk because the transactions they do are for hedging purposes only (no proprietary trading). For example, the FX transactions that are done by Trena McFarland in London are done on the behalf of our Houston office, so Houston books the transaction, manages the risk, and writes the Confirmation in the name of ENA. This being the case, (i) can we apply the same logic on the internal FX transactions that will be managed by both the US and UK traders and have the transacting entity as ENA (ii) if we do does it gives us the necessary tax relief, or (iii) should we stick the Metals structure where the transactions are offered by Enron North America, acting through it's agent, Enron Europe Finance and Trading Limited. While this may be an Internal Only Product Type today, what effect, if any, would the choice of trading entities have on our ability to offer these Products externally. Technology Issue: David - Stuart has explained to me that the US FX Desk now views these currency exchange products as financial products. This is contrary to previous discussions where we felt that any currency exchange involving an Index would be considered financial, while any 'strict exchange' would be considered a physical transaction. The change is based on conversations Stuart has had with the Metals traders wherein they would like to see this exchange product as a financial product. If we accept this logic, (i) do I need to create a Deal Type for 'Par Forward Swap' for the first FX Index Product Type that we did as well as a 'Forward Swap' for these transactions, or is it acceptable to leave these both as swaps, and (ii) regardless of the Deal Type classification discussed in (i), I will need to create a new Product Type for the 'strict exchange' - either as a physical or financial product. Additionally, if I set this up as Financial Product, I have the Index attribute in the template to contend with, because there is no Index; and if I set this up as a Physical Product, I have the Location attribute to contend with, because there is no Location. Naturally we can put something cheesy in to fill the gap since it's internal, but if we ever decide to go external we will need a new template - and from experience with the PJM Power (Weather Desk) Product Type, templates requires an 'and if' statement are hard to develop. Dale
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