A company can be appointed to act as more than one BSC Agent, with the exception of the company appointed as the BSC Auditor. The BSC Auditor can, however, be appointed as the Qualification Service Provider. A Party cannot be appointed as a BSC Agent.

BSC Agents are the Settlement Administration Agent (SAA), the Funds Administration Agent (FAA), the Balancing Mechanism Reporting Agent (BMRA), the Energy Contract Volume Aggregation Agent (ECVAA), the Central Data Collection Agent (CDCA), the Technical Assurance Agent¹ (TAA), the Central Registration Agent (CRA), the Supplier Volume Allocation Agent (SVAA), the Teleswitch Agent, the BSC Auditor, Profile Administrator² and the Transmission Loss Factor Agent.

BSC Service Descriptions

With respect to each BSC Agent service, the BSC Service Description shall specify the services to be provided by each person appointed as the BSC Agent.

BSC Service Descriptions specify the services to be provided by the BSC Agent by reference to those provisions of the BSC and any other Code Subsidiary Document which relate to the functions to be carried out by the relevant BSC Agent. In addition, a BSC Agent Contract can cover the provision of ad-hoc services (which are necessary for, or incidental to, giving effect to the BSC).

Where the BSC and/or a Code Subsidiary Document is amended, Elexon must do what it can to ensure that any relevant BSC Agent Contract takes effect by reference to the modified BSC and/or amended Code Subsidiary Document with effect from the date of the BSC and/or Code Subsidiary Document modification.

If the same company is appointed in the capacity of more than one BSC Agent, data transfer provisions between those BSC Agents do not have to be detailed in Code Subsidiary Documents and that company will be assumed to be in possession of data and information that it has received in one of its capacities for the purposes of all of its capacities. Otherwise, if a different company is to be appointed, the data transfer provisions will be documented in the Code Subsidiary Documents.

If Elexon proposes, and the Panel agrees, that particular services contained in a BSC Service Description should be provided by another company, the Panel can modify the prevailing BSC Service Descriptions and create new BSC Service Descriptions to give effect to this.

Although the BSC is written as if certain functions of BSC Agents are obligations on those Agents, it is acknowledged that, as BSC Agents are not Parties, the BSC does not itself directly impose obligations on BSC Agents, rather these obligations are discharged via the BSC Agent Contract.

Role of Elexon

Elexon has a responsibility to ensure that there is at all times someone appointed as a BSC Agent for each BSC Service Description.

Elexon selects and enters into contracts with BSC Agents and subsequently manages and enforces those contracts; monitors and supervises performance of the BSC agent under each contract; amends or varies each Agent contract; where appropriate exercises rights of termination of each contract; upon expiry or termination of a BSC Agent contract, extends or renews the contract or appoints a different company to act as BSC Agent.

Without bias of anything contained in a BSC Service Description (there can be one covering several services if the same company is appointed to provide more than one service) requires the BSC Agent to undertake all of the functions and responsibilities described in the BSC and Code Subsidiary Documents pertaining to that BSC Agent. Any variation from this rule can only be achieved with the approval of the Panel. In deciding whether to allow a variation, the Panel will consult with Parties as it considers appropriate and, if appropriate, deal with the matter as a modification to the relevant BSC Service Description. The Panel will not give any approval to vary this requirement where the BSC Agent objects to any material term of the proposed BSC Agent Contract.

Management of BSC Agent Contracts

Elexon is required to establish arrangements for the proper and efficient management of each BSC Agent Contract, including the provision of ad-hoc or non-routine services, and to provide a copy of those arrangements to the Panel.

A Party may order the provision of any service (under a BSC Agent contract) directly from a BSC Agent, following Elexon obtaining approval from the Panel for those arrangements to be made, and all of the charges of the BSC Agent related to the provision of such a service are to be met directly (or charged as specific BSC Charges) to the Party ordering the service. Elexon if so requested by a Party shall account for the costs of ordering the service in accordance with the rules outlined in Section D.

Elexon will consult with the Panel in relation to any proceedings or arbitration against a BSC Agent under a BSC Agent Contract. Where the amount of the claim involved exceeds a threshold amount, Elexon must gain the Panel's approval in relation to key matters in the proceedings or arbitration, as specified in Section E.

Elexon, in discussion with the Panel, will establish arrangements for reporting periodically to it on the management of each BSC Agent Contract and the performance of each BSC Agent.

Contract Principles

Elexon shall, in consultation with the Panel, establish a statement of the "Contract Principles" which will guide Elexon in setting the terms of BSC Agent Contracts. The Contract Principles will include statements on the capacity of Elexon in entering into the contract, the principles and methods of pricing of services under the contract, liability and limitations or exclusion of liability for breach of the contract, the ownership of Intellectual Property Rights in materials produced by the BSC Agent and principles to apply where the BSC Agent sub-contracts performance of its obligations, and the extent to which the contract should restrict the ability of the BSC Agent to do so. Elexon must obtain Panel consent before departing in any material respect from the applicable Contract Principles when setting a BSC Agent Contract. Elexon will apply the Contract Principles or will obtain permission from the Panel before materially departing from these principles.

Contract Requirements

Each BSC Agent Contract must contain terms which:

(a) give effect to the principle that Trading Parties should have the benefit of the main obligations of the BSC Agent under the contract;

(b) provide that the contract can be assigned or novated, without consent of the BSC Agent, to any company acting as successor to Elexon;

(c) provide that the BSC Agent will not make claims in respect of breach of the BSC Agent Contract against any Party other than Elexon;

(d) will not permit a BSC Agent to act as agent for, or make any commitment to incur any liability binding on, any Party, and

(e) Where the contract includes the supply of services to Permitted Affiliates will:

(i) prevent the BSC Agent from terminating any part of a BSC Agent Contract that relates to the performance of BSC Agent services as a result solely of any breach by BSCCo of provisions relating to the supply of services by the BSC Agent for Feed in Tariff Contracts for Difference, Capacity Agreements and EMR Tender Activities; and

(ii) restrict BSCCo’s liability to the BSC Agent for any claim in damages or any other claim of a financial nature relating solely to the supply of services by the BSC Agent in support of Feed in Tariff Contracts for Difference, Capacity Agreements and EMR Tender Activities to the amounts payable under that BSC Agent Contract for those services.

BSC Agent Contracts must also provide for the granting of equivalent licences or conferring equivalent rights (or allow Elexon to grant a sub-licence or confer equivalent rights) in relevant Intellectual Property Rights to a designated person for the benefit of Scottish Trading Parties should Scottish Trading Arrangements analogous to the BSC be introduced.

Termination of BSC Agent Contracts

If Elexon proposes to terminate a BSC Agent Contract or to waive the right to terminate the contract or, upon the expiry of a BSC Agent Contract, not to renew or extend the contract, it must notify the Panel. If termination of a BSC Agent Contract could result in Elexon being liable to pay an amount for terminating the contract, or continue to pay fees under the contract after the services had stopped being provided, exceeding a threshold amount (set by the Panel), Elexon must obtain the prior approval of the Panel.

Appointment of BSC Agents

Before starting the procurement of a BSC Agent Contract Elexon will prepare, in discussion with and obtain approval from the Panel, a "Procurement Approach Statement" specifying the approach to be taken by Elexon in the procurement and the criteria to be applied in competitively selecting the person to whom the contract will be awarded. In addition Elexon will report to the Panel the selection of the bidder and the award of the contract. The Panel can choose to establish a "Procurement Committee", or “Procurement Observer”, to advise Elexon in the conduct of the procurement and the award of the contract. These procurement procedures also apply when Elexon, with prior approval from the Panel, seeks to award a BSC Agent Contract for the new SVAA BSC Agent Services without a competitive procurement process. Such BSC Agent Contracts must not exceed a duration of 24 months following the completion of the MHHS Implementation transition (referred to as "Milestone 15" in the MHHS Implementation Timetable)

Relationship between Parties, Elexon and BSC Agents

Section E provides that Parties do not intend that any BSC Agent will have any rights, benefits, entitlements or privileges under the BSC or any Code Subsidiary Document or that any term of the BSC or Code Subsidiary Document is enforceable by any BSC Agent by virtue of the Contracts (Rights of Third Parties) Act 1999.

Where by virtue of this same Act, a term of a BSC Agent Contract is enforceable by or for the benefit of a Party, the consent of that Party is not required to an amendment, variation or rescission of that BSC Agent Contract.

Where a Party has any right, claim or entitlement against a BSC Agent as a result of the BSC Agent Contract, Elexon is appointed and authorised to act as exclusive agent for the purpose of enforcing such rights, claims or entitlements and each Party agrees that it will not take enforcement action itself.

Where the BSC provides for Parties to agree to give any permission, consent, approval, licence or right to a BSC Agent or to waive or release any BSC Agent from any possible liability to claim by Parties, Elexon is authorised to act as agent for and on behalf of Parties in entering into the BSC Agent Contract for the purposes of conferring that permission, consent, approval, licence or right or waiver or release on the BSC Agent.

Elexon may provide indemnities to BSC Agents against any breach by a Party of the undertakings provided in this part of Section E, and Parties also indemnify Elexon against any liability which Elexon may incur as a result of a Party breaching such undertakings.

In acting as a Party's agent in relation to specified activities concerning BSC Agents' Contracts, Elexon cannot make any commitment or incur any liability on a Party's behalf without the prior consent of that Party and/or in accordance with any explicit provision of the BSC.

BSC Services Manager

Elexon may, from time to time, appoint a “BSC Services Manager” to act as its agent for the purposes of discharging some or all of Elexon’s powers, functions and responsibilities set out in Section C of the BSC and as otherwise specified in the Code. Any amendments to the Code which seek to amend this shall require the prior approval of the Board.

The BSC Services Manager is a BSC Agent but, other than the setting out the relationship between Parties, Elexon and BSC Agents, Section E does not apply to the BSC Services Manager. The person appointed as BSC Services Manager is not entitled to also be a Party, a BSC Company or another BSC Agent.

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1 At the Code Effective Date separate contracts provide services for the TAA in relation to CVA Metering

2 Elexon shall not be classified as a BSC Agent for any period in which it provides the Profile Administration Services (see Section C) and shall be considered to provide those services in its capacity as BSCCo (and hence Section E shall not apply to Elexon's provision of those services).

3 https://support.elexon.co.uk/csm

CONTENTS

Section E: BSC Agents V11.0

Introduction

BSC Agents