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Template:Isda 5(a)(vii) summ: Difference between revisions
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Amwelladmin (talk | contribs) (Created page with "=====The market standard “bankruptcy” definition ===== The ISDA {{{{{1}}}|bankruptcy}} definition is rarely a source of great controversy (except for the grace period, which gets negotiated only through custom amongst ISDA negotiators because, in its wisdom, {{icds}} thought fit to halve it from 30 days to 15 in the {{2002ma}}. So you have a sort of ''pas-de-deux'' between negotiators where they argue about it for a while before getting t...") |
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===Differences between {{1992isda}} and {{2002isda}} definitions of {{{{{1}}}|Bankruptcy}}=== | |||
There are two: | |||
*'''Slightly more specific concept of insolvency''': firstly, in limb 4 ('''insolvency proceedings''') a new limb (A) has been included to cover action taken by an entity-specific regulator or supervisor (as opposed to a common or garden insolvency proceeding): If initiated by a regulator, the game’s up as soon as the action is taken. If initiated by a random, the action must have resulted in a winding-up order, or at least not have been discharged in ''15'' (not 30) days. | |||
*'''Contracted [[grace period]]''': The allowable period for dismissal of an insolvency petition (under {{{{{1}}}|5(a)(vii)}}(4)) or the exercise of security over assets (under {{{{{1}}}|5(a)(vii)}}(7)) is compressed from 30 days to 15 days. This, in aggregate over the whole global market, keeps many a [[negotiator]] in meaningful<ref>“meaningful” is in the eye of the beholder, you understand.</ref> employment, and you will see many large organisations, whom you’d think would know better, amending these [[grace period]]s back to the {{1992ma}} standard of 30 days or better still, insisting on sticking with a {{1992ma}}, but upgrading every part of it to the {{2002ma}} ''except'' for the {{{{{1}}}|Bankruptcy}} and {{{{{1}}}|Failure to Pay}} [[grace period]]s. This is a simply spectacular use of ostensibly limited resources. | |||
===Regional bankruptcy variations=== | |||
The Germanic lands have peculiar ideas when it comes to bankruptcy — particularly as regards [[bank]]s, so expect to see odd augmentations and tweaks to {{icds}} standard language. Will these make any practical difference? Almost certainly not: it is hard to see any competent authority in [[Germany]], [[Switzerland]] or [[Austria]] — storeyed nations all, in the long history of banking, after all — not understanding how to resolve a [[bank]] without blowing up its netting portfolio. Especially since [[Basel]], where the netting regulations were formulated, is actually ''in'' [[Switzerland]]. | |||
*[[Swiss Bankruptcy Language|Switzerland]] | |||
=====The market standard “[[bankruptcy]]” definition ===== | =====The market standard “[[bankruptcy]]” definition ===== | ||
The ISDA {{{{{1}}}|bankruptcy}} definition is rarely a source of great controversy (except for the [[grace period]], which gets negotiated only through custom amongst ISDA [[negotiator]]s because, in its wisdom, {{icds}} thought fit to halve it from 30 days to 15 in the {{2002ma}}. | The ISDA {{{{{1}}}|bankruptcy}} definition is rarely a source of great controversy (except for the [[grace period]], which gets negotiated only through custom amongst ISDA [[negotiator]]s because, in its wisdom, {{icds}} thought fit to halve it from 30 days to 15 in the {{2002ma}}. | ||