1. International Businesses
Weather
Pulp FX
Interest
Equities
Bonds
Softs
Metals
Global Liquids
Coal
Credit derivatives
North American Gas and Power
European Gas and Power

2. Weather
Pre 2000
Houston risk book, London originators
European transactions booked in ECTRIC through EEFT
with back to back to ENA
Services agreement between ECTRIC and EEFT (cost + 5%)
Post 2000
Main risk book in Houston, small risk books in Oslo and
Sydney, London origination
Oslo originated transactions booked in ECTRIC Norway
branch with back to back to ENA [check]
London originated transactions booked in ECTRIC through
EEFT with back to back to ENA
Sydney originations [check]
Services agreement between ECTRIC and EEFT for London
origination activity (cost + 10%) and [Sydney]
Review of business changes quarterly

3. Pulp
Pre 2000
Houston risk book, London originators
London originated financial transactions booked in ECTRIC
through EEFT with back to back to ENA
Services agreement between ECTRIC and EEFT (cost + 5%)
Post 2000
Main risk book in Houston, small risk book in London, plus
origination
Services agreement between ECTRIC and EEFT for London
origination activity (cost + 10%)
Review of business changes quarterly

4. FX [interest]
Pre 2000
Houston risk book, London and Sydney originators
London originated transactions booked in ENA through agent
EEFT. Sydney originated transactions booked in ENA through
agent Enron Australia Finance Pty Ltd (“EAFPL”)
Services agreement between ENA and EEFT, and ENA and
EAFPL (cost + 5%)
Post 2000
Main risk book in Houston, possibly small risk books in London
and Tokyo (relocated from Sydney)
Services agreement between ENA and EEFT for London
origination activity and ENA and EAFPL (cost + 10%)
Review of business changes quarterly

5. Equities and bonds
Pre 2000
No transactions executed outside of the US
Equities and bonds books in ECT Investments Inc
Post 2000
Structure for London based bonds and equities business is
currently under discussion
Separate risk books for Houston and London, some trades
expected between the books
* Agent v CFC acting as principal
* Regulatory issues

6. Softs
Post 2000
Proprietary softs business in Houston
Former Rudolf Wolff softs business in London conducts
brokerage and financing business – future development of
the business under commercial review (proprietary trading
out of London ?)
* Regulatory issues

7. Metals
Post 2000
Financial – risk book in London (MGL). Agents in NY and
Tokyo enter into trades on behalf of MGL. Book is passed.
Compensation by way of commission.
Physical – risk book in London (MG MCC Ltd). Agents in NY
and Montreal enter into trades on behalf of MG MCC Ltd.
Copper concentrates – risk book in NY (MG MCC Corp).
Business changes expected
* brokerage
* financing business
* proprietary trading
* Regulatory issues

8. Global Liquids
Pre and Post 2000
Separate risk books for
* Houston
* London
* Singapore
* Global Arb books
Financial and Physical transactions booked to the same
product risk book eg. London Gasoil
Regulatory issues
* EEFT agency compensated by commission agreement
Business changes – move to global books ?

9. Coal
Pre 2000
Separate risk books for Physical coal
* Houston – N America
* London – rest of world
Origination in Australia and India, compensated by
commission agreement
Post 2000
London - Creation of European coal future market via EOL
London - Creation of Physical (ECSL) and Financial
(ECTRIC) freight risk books
London - creation of new desk for transportation of domestic
coal (rail freight, port throughput)
Australia - separate risk book for Australian originated
transactions
Regulatory issues

10. Credit derivatives
Post 2000
Single risk book in London (EnronCredit.com Ltd)
Trades involving the support of the Houston based personnel
booked in ENA and backed into EnronCredit.com Ltd
* ENA compensated under services agreement
Regulatory issues in Europe

11. North American Gas and Power
Pre and Post 2000
Separate risk books in US (ENA) and Canada (ECT Canada
Inc)
Trades between the risk books

12. European Gas and Power
Pre and Post 2000
Separate risk books
* Physical UK (ECTRL)
* Financial UK (ECTRI/EEFT)
* Continental Physical (ECTRL)
* Continental Financial (ECTRI/EEFT)
* Scandinavian Physical and Financial (ECTRIC Norway)
Trades between the risk books
Regulatory issues
Centralised management of risk in London (except Norway)
with European origination
* hub and spoke
* origination compensated on cost plus

13. Transfer pricing approach
Tax Dept.’s response to Global books
APA
Services agreements versus trading profit allocation
Effective coordination
Recent tax developments