Template:M comp disc 2002 ISDA 5(a)(v)

Two key differences between the 1992 ISDA DUST and the 2002 ISDA DUST: The 2002 ISDA version is updated to exclude “defaults” which qualify as mini closeouts under stock loan documentation — a concept which the stock loan market invented after the 1992 ISDA was published, so you can’t really blame ISDA’s crack drafting squad™ for overlooking it at first — as these tend to arise from normal market settlement failures and are not credit-driven, and secondly the criteria for something to count as a repudiation are stiffened to require written evidence from the repudiating party. The latter of these really more am articulation of common sense, for it would be a brave risk officer indeed who closed out an ISDA Master Agreement based on an oral communication, or the proverbial extended middle finger, for which she could not subsequently produce in fairly compelling evidence. But still.

The mini closeout point, as we discuss in the commentary below, is technically correct but should have led to a simplification of the DUST provision, rather than a convolution of it. I know what you’re thinking, and you’re right: like that was ever going to happen.