05.07.2009

This is the danger of political or financial instability in the host country caused by events such as insurrections, strikes, suspension of foreign exchange, creeping expropriation and outright nationalization. It also includes the risk that a government may be able to avoid its contractual obligations through sovereign immunity doctrines. Common mechanisms for minimizing political risk include: (a) requiring host country agreements and assurances that a project will not be interfered with; (b) obtaining legal opinions as to the applicable laws and the enforceability of contracts with government entities; (c) requiring political risk insurance to be obtained from bodies which provide such insurance (traditionally government agencies); (d) involving financiers from a number of different countries, national export credit agencies and multilateral lending institutions such as a development bank; and (e) establishing accounts in stable countries for the receipt of sale proceeds from purchasers

Colloquial, non-industry-specific term for a rate structure in which each customer in a given class is charged the same rate for a commodity as every other customer, regardless of the cost of serving different customers in the same class. Also refers to rates set for all customers in a given territory regardless of their distance from the point where the given service or commodity is supplied. Derived from the traditional practice of pricing postage identically for all deliveries from all parties regardless of location or cost of service. The tariff for the transmission of natural gas is a postalized tariff meaning it is the same tariff for all consumers regardless of the distance the gas needs to be transmitted through