[Code of Federal Regulations]
[Title 18, Volume 1]
[Revised as of April 1, 2004]
From the U.S. Government Printing Office via GPO Access
[CITE: 18CFR284.288]

[Page 756-757]
 
           TITLE 18--CONSERVATION OF POWER AND WATER RESOURCES
 
  CHAPTER I--FEDERAL ENERGY REGULATORY COMMISSION, DEPARTMENT OF ENERGY
 
PART 284_CERTAIN SALES AND TRANSPORTATION OF NATURAL GAS UNDER THE 
NATURAL GAS POLICY ACT OF 1978 AND RELATED AUTHORITIES--Table of Contents
 
Subpart J_Blanket Certificates Authorizing Certain Natural Gas Sales by 
                          Interstate Pipelines
 
Sec. 284.288  Code of conduct for unbundled sales service.

    (a) A pipeline that provides unbundled natural gas sales service 
under Sec. 284.284 is prohibited from engaging in actions or 
transactions that are without a legitimate business purpose and that are 
intended to or foreseeably could manipulate market prices, market 
conditions, or market rules for natural gas. Prohibited actions and 
transactions include but are not limited to:
    (1) Pre-arranged offsetting trades of the same product among the 
same parties, which involve no economic risk and no net change in 
beneficial ownership (sometimes called ``wash trades''); and
    (2) collusion with another party for the purpose of manipulating 
market prices, market conditions, or market rules for natural gas.
    (b) To the extent Seller engages in reporting of transactions to 
publishers of electricity or natural gas indices, Seller shall provide 
accurate and factual information, and not knowingly submit false or 
misleading information or omit material information to any such 
publisher, by reporting its transactions in a manner consistent with the 
procedures set forth in the Policy Statement on Natural Gas and Electric 
Price Indices, issued by the Commission in Docket No. PL03-3-000 and any 
clarifications thereto. Seller shall notify the Commission within 15 
days of the effective date of this regulation of whether it engages in 
such reporting of its transactions and update the Commission within 15 
days of any subsequent change to its transaction reporting status. In 
addition, Seller shall adhere to such other standards and requirements 
for price reporting as the Commission may order.
    (c) A pipeline that provides unbundled natural gas sales service 
under Sec. 284.284 shall retain, for a period of three years, all data 
and information upon which it billed the prices it charged for natural 
gas it sold pursuant to its market based sales certificate or the prices 
it reported for use in price indices.
    (d) Any violation of the preceding paragraphs may subject Seller to 
disgorgement of unjust profits from the date when the violation 
occurred. Seller may also be subject to suspension or revocation of its 
blanket certificate under Sec. 284.284 or other appropriate non-
monetary remedies.
    (e) Any person filing a complaint against a pipeline for violation 
of paragraphs (a) through (c) must do so no later than 90 days after the 
end of the calendar quarter in which the alleged violation occurred 
unless that person could not have known of the alleged violation, in 
which case the 90-day time limit will run from the discovery of the 
alleged violation. The Commission will act within 90 days from the

[[Page 757]]

date it knew of an alleged violation of these code of conduct 
regulations or knew of the potentially manipulative character of an 
action or transaction. Commission action in this context means a 
Commission order or the initiation of a preliminary investigation by 
Commission Staff pursuant to 18 CFR section 1b. If the Commission does 
not act within this time period, the seller will not be exposed to 
potential liability regarding the subject action or transaction. 
Knowledge on the part of the Commission will take the form of a call to 
our Hotline alleging inappropriate behavior or communication with our 
enforcement Staff.

[Order 644, 68 FR 66336, Nov. 26, 2003]