Marc Rich wins licence to supply electricity: Chairman remains in Switzerland because of tax charges

Click to follow
MARC RICH and Co, the London operation of the independent Swiss-based commodity company, was awarded a licence to supply electricity in England and Wales by the Office of Electricity Regulation, writes Lisa Vaughan.

The licence, effective today, is the first to be awarded to an international energy trading company, and the first to be awarded in over a year.

Marc Rich is one of the world's largest traders of oil, metals and minerals.

The company's chairman, Marc Rich, lives in Zug, Switzerland. He does not visit the US because of tax charges linked to oil trading lodged a decade ago, and his firm says that the risk of apprehension by US authorities means he does not visit the UK either.

The firm, which has been active in the UK electricity futures market for a year, will now be able to operate in the pool system of electricity pricing, similar to a spot or cash market.

Marc Rich is limited to supply 4,600 non-domestic premises with demand of more than one megawatt until next year, rising to potentially 50,000 customers of more than 100 kilowatts in April 1994. The limit will be abolished in April 1998.

Simon Spencer of Marc Rich said that the company had not yet signed any contracts involving the use of the licence, or entered into negotiations.

'It's unlikely that we'll take the ramparts by storm in the immediate future, but we will approach the market from an opportunistic point of view.'

The licence to operate in Britain's physical electricity market in Britain compliments Marc Rich's activities in the energy markets. Once it begins trading, the physical business could boost its electricity futures trading activities as it hedges physical positions, Mr Spencer said.