Automatic Early Termination - ISDA Provision: Difference between revisions

{{fullanat2|isda|6(a)|1992|6(a)|2002}}Automatic Early Termination is a concept which exists in Section {{isdaprov|6(a)}} {{isdaprov|Right to Terminate Following Event of Default}} of the {{isdama}}. it is relevant to [[Netting]].

===AET under the {{1987ma}}===

Note the somewhat difficult position for AET under the {{1987ma}} - a fuller discussion at that article - which was part of the reason for the move to the {{1992ma}} in the first place.

Note that {{isdaprov|AET}} is only triggered by certain events under the {{isdaprov|Bankruptcy}} [[Events of Default - ISDA Provision|event of default]], and isn't triggered by {{isdaprov|Cross Default}} for example.

It only applies to formal {{isdaprov|bankruptcy}} events in the jurisdiction, not “catastrophic credit events that are effectively as good bankruptcy” but which don't amount to formal bankruptcy events, for reasons that will become clear below.