Paul further to my email/voicemail on our attempts to get an Exempt Market 
Declaration issued to Enron Australia Finance Pty Ltd (EAF).  I now have a 
specific request to put to you.

It appears that we would qualify for such a  Declaration thereby allowing EAF 
to use the safe harbour provisions under the Australian Corporations Law for  
trading through EnronOnline if EAF had get a guarantee from  Enron Europe 
Finance and Trading Ltd. We would be able to take advantage of a specific 
provision in the policy guideline of the Australian Securities and 
Investments Commission on the grant of Declarations known as Policy Statement 
70. (Below is a summary of the relevant provisions of the Policy Statement.) 
Would the provision of such a guarantee be possible? 

Clearly an issue to consider would be any possible impact on EEFT's 
prudential requirements under the Financial Services Act. If this were an 
issue perhaps could it be overcome if there was a back to back guaranty from 
say Enron Corp. to EEFT. This mean that effectively EEFT would have no 
additional exposure.       

>

>
> Paragraph 50(c) of Policy Statement 70 provides that persons authorised to
> carry on investment business under the Financial Services Act of the
> United Kingdom (other than persons who are "low risk firms" for the
> purposes of the Financial Supervision Rules 1990 issued by the Securities
> Investment Board) will be regulated facility providers.  As a result,
> unless EEFT is a "low risk firm"  then it could be a regulated facility
> provider.
>
> Paragraph 48(e) provides that organisations whose liabilities and
> obligations in relation to their exempt futures market activities are
> unconditionally and irrevocably guaranteed by such an organisation will
> also be regulated facility providers.  As a result, provided that EEFT is
> not a "low risk firm" and it guarantees the obligations of EAF then the
> prudential regulatory requirements of ASIC should be satisfied and EAF
> could be a regulated facility provider.
>
> Please let me know if such a guarantee is going to be possible.
>
>
> Scott Farrell
> Senior Associate
> Mallesons Stephen Jaques Sydney
> Direct line (61 2) 9296 2142
> Fax (61 2) 9296 3999
>