Template:Isda 3(d) summ: Difference between revisions
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Now you might ask what good an item of {{{{{1}}}|Specified Information}} can possibly be, if Section {{{{{1}}}|3(d)}} ''didn’t'' apply and it could be just made up on the spot without fear of retribution — as a youngster, the [[JC]] certainly asked that question, and has repeated it over many years, and is yet to hear a good answer — but all we can presume is that in its tireless quest to cater for the unguessable predilections of the [[Negotiator|negotiating community]], {{icds}} left this preposterous option open ''just in case''. It wouldn’t be the first time. | Now you might ask what good an item of {{{{{1}}}|Specified Information}} can possibly be, if Section {{{{{1}}}|3(d)}} ''didn’t'' apply and it could be just made up on the spot without fear of retribution — as a youngster, the [[JC]] certainly asked that question, and has repeated it over many years, and is yet to hear a good answer — but all we can presume is that in its tireless quest to cater for the unguessable predilections of the [[Negotiator|negotiating community]], {{icds}} left this preposterous option open ''just in case''. It wouldn’t be the first time. | ||
A trawl through the [[SEC]]’s “Edgar” archive<ref>[https://www.google.com/search?q=%22ISDA+Master+Agreement%22+site%3Ahttps%3A%2F%2Fwww.sec.gov You are welcome.]</ref> reveals that the sorts of things to which “[[Covered by Section 3(d) Representation]]” results in a “No.” outcome are rare but not non-existent. It is things like “Legal opinion from counsel concerning due authorization, enforceability and related matters, addressed to the other party and reasonably acceptable to such other party”, “Credit support documents”. | A trawl through the [[SEC]]’s “Edgar” archive<ref>[https://www.google.com/search?q=%22ISDA+Master+Agreement%22+site%3Ahttps%3A%2F%2Fwww.sec.gov You are welcome.]</ref> reveals that the sorts of things to which “[[Covered by Section 3(d) Representation]]” results in a “No.” outcome are rare but not non-existent. It is things like “Legal opinion from counsel concerning due authorization, enforceability and related matters, addressed to the other party and reasonably acceptable to such other party”, or “Credit support documents”. | ||
The other little fiddle — and it ''is'' a little fidgety fiddle — is to remark of annual reports that, yes, they ''are'' covered by that Section 3(d) representation, ''but'' with a [[proviso]]: | The other little fiddle — and it ''is'' a little fidgety fiddle — is to remark of annual reports that, yes, they ''are'' covered by that Section 3(d) representation, ''but'' with a [[proviso]]: | ||
{{quote|“Yes; ''provided that'' the phrase “is, as of the date of the information, true, accurate and complete in every material respect” in Section {{{{{1}}}|3(d)}} shall be deleted and the phrase “fairly presents, in all material respects, the financial condition and results of operations as of their respective dates and for the respective periods covered thereby” shall be inserted in lieu thereof.”}} | {{quote|“Yes; ''provided that'' the phrase “is, as of the date of the information, true, accurate and complete in every material respect” in Section {{{{{1}}}|3(d)}} shall be deleted and the phrase “fairly presents, in all material respects, the financial condition and results of operations as of their respective dates and for the respective periods covered thereby” shall be inserted in lieu thereof.”}} | ||
These are the only examples we could find before we got bored looking. In each case we are not persuaded these caveats accommodate anyone other than our value-adding learned friends: | |||
====Legal opinions==== | |||
We suppose this is excluded because the Party to the ISDA is not the author of the legal opinion, nor professionally competent to pass on its contents (hence the need for the legal opinion in the first place), so should hardly be expected to be held to account should it turn out to be wrong. | |||
But this, we submit, is to misunderstand in a profound way the point of a legal contract. Unlike criminal or even tort law, the law of contract is not an instrument of moral judgment. It cares only about economics: that one does, or does not, do what one has promised. It is incurious about ''why''. The object of a legal opinion is to be informed of a legal status. That legal status, being an abstract thing, can only be ''[[formal]]ly'' represented on the notepaper of a firm of solicitors. If what that notepaper says is not true, for whatever reason, then the legal status does not obtain, and the comfort your counterparty seeks from that legal opinion is misplaced. | |||
====Credit Support documents==== | |||
====Annual reports==== | |||