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Contract termination

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22 May 2018

In certain circumstances carbon abatement contracts may be terminated by the seller or the Clean Energy Regulator. If a contract is terminated prior to the delivery obligations being met, the funds that were allocated to that contract will be made available at a future auction. In some circumstances market damages for the balance of the contracted volume must also be paid.

Carbon abatement contracts can be terminated for a number of reasons including:

  • If any conditions precedent are not waived or fulfilled by the conditions precedent expiry date.
  • A representation or warranty made by either party is found to have been made recklessly, wilfully or intentionally false or misleading. This includes representations or warranties made during auction qualification or registration, or during your project application.
  • The seller becomes insolvent, or events prescribed in the contract occur that are similar to insolvency (and where novation to another party has not occurred).
  • If a force majeure event continues for more than 365 days, or beyond the expiry date.
  • By agreement by both parties.​

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