Template:M comp disc EUA Annex all a dream

There are thee discrete “then I woke up and it was all a dream” scenarios in the ISDA EU Emissions Annex.

Settlement Disruption Event

Section (d)(i)(4)(D) is the part of the Settlement Disruption Event where things seem to have ground to an irretrievable halt, and ISDA’s crack drafting squad™ has concluded the best thing to do is for everyone to just forget whatever it was they were expecting to get out of the transaction, and put everything back how they found it and walk away. Curious, we call it. Curious. And most un-ninjery.

Suspension Event

Section (d)(i)(5)(D) is the equivalent provision for Suspension Events. It is most curious and really makes me think the JC must have missed something big here, because the sort of things you would expect to be consistent across various events that delay scheduled settlement: Suspension, Settlement Disruption and so on — things like Cost of Carry compensation — are different, whereas the one thing that you would expect to, well, to not be there at all, frankly — the then I woke up and it was all a dream termination sequence — is curiously consistent.

Abandonment of Scheme

Section (d)(iv), about Abandonment of Scheme, similarly, weirdly, plumps for the just a dream scenario. You would think a Forward seller, whether outright or of an option, who thought she had got those confounded Allowances off her desk, might be dismayed to find them right back on there at just the point where they became utterly valueless.