Issue 02: Credit Indebtedness Calculation During Holiday Periods
Formal title: Credit Indebtedness Calculation During Holiday Periods
Current Status
Where a supplier is purely (or dominantly) non-domestic then its actual demand can drop significantly (down to 1/3) during this period. Its contractual position will follow this drop. During the period between the delivery day and the II run (which can be more than 10 days during Christmas) the CALF calculation massively overstates the demand. This can rapidly tip such portfolios into credit shortfall at a time when banking services are not available.
Progression
A draft Modification Proposal was considered at the meeting of the SSMG on 29 January 2003. The group provided some guidance on how to word the proposal. The Proposer eventually raised two Modification Proposals, P120 and P121, on 12 March 2003 which were subsequently withdrawn and Modification Proposals P122 and P123 were raised.