FATCA Withholding Tax - ISDA Provision

From The Jolly Contrarian
Jump to navigation Jump to search
2002 ISDA Master Agreement

A Jolly Contrarian owner’s manual™

FATCA Amendment in a Nutshell

The JC’s Nutshell summaries are moving to the subscription-only ninja tier. For the cost of ½ a weekly 🍺 you can get them here. Sign up at Substack.

FATCA Amendment in all its glory

FATCA Withholding Tax:

The following is added at the end of Section 2(d) as new section 2(d)(iv):

2(d)(iv) Foreign Account Tax Compliance Act. The words “any tax from any payment” in any Payer Tax Representation and the definition of “Indemnifiable Tax” each excludes any tax imposed under Sections 1471 and 1472 of the Internal Revenue Code of 1986, as amended, (or the United States Treasury Regulations or other guidance issued thereunder) (“FATCA Withholding Tax”).

Related agreements and comparisons

Click here for the text of Section FATCA Amendment in the 1992 ISDA
Template:Isdadiff FATCA Amendment

Resources and Navigation

This provision in the 1992

Resources Wikitext | Nutshell wikitext | 1992 ISDA wikitext | 2002 vs 1992 Showdown | 2006 ISDA Definitions | 2008 ISDA | JC’s ISDA code project
Navigation Preamble | 1 | 2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14
Events of Default: 5(a)(i) Failure to Pay or Deliver5(a)(ii) Breach of Agreement5(a)(iii) Credit Support Default5(a)(iv) Misrepresentation5(a)(v) Default Under Specified Transaction5(a)(vi) Cross Default5(a)(vii) Bankruptcy5(a)(viii) Merger without Assumption
Termination Events: 5(b)(i) Illegality5(b)(ii) Force Majeure Event5(b)(iii) Tax Event5(b)(iv) Tax Event Upon Merger5(b)(v) Credit Event Upon Merger5(b)(vi) Additional Termination Event

Index: Click to expand:



FATCA and the HIRE Act are what this is all about. A proposed amendment to the form to deal with these taxes which were introduced after the global financial crisis



You will see the attached added as a result of FATCA, so that a withholding imposed as a result of FATCA is excluded from the definition of Indemnifiable Tax — a definition which is already a quintuple negative, so this truly propels it into the stratosphere of convoluted drafting.

Premium content

Here the free bit runs out. Subscribers click 👉 here. New readers sign up 👉 here and, for ½ a weekly 🍺 go full ninja about all these juicy topics 👇
  • The JC’s famous Nutshell summary of this clause
  • More about FATCA

See also