No Agency - ISDA Provision: Difference between revisions

It is not beyond the paranoid fantasies of a US [[tax attorney]] — a rich, baroque tapestry indeed — to want to “[[deem]]” a swap counterparty to be an agent for one it its affiliates for certain purposes — you know, tax purposes — even though the affiliate is not mentioned in the {{t|contract}} and the other side has not the first clue that this affiliate even exists.

How does this bear on your Section {{isdaprov|3(g)}} representation? As far as your counterparty is concerned, not at all: a fellow acting under an agency he has not disclosed to his counterpart is called a “[[principal]]”. This is all the {{isdaprov|3(g)}} [[representation]] is meant to confirm: [[for the avoidance of doubt]] — of which there wasn’t much anyway — you are not acting on behalf of someone else. Therefore, should you not perform our contract, I can bring my claim against you; you cannot slip out of the tackle by pointing to some under-capitalised [[espievie]] in a banana republic whom you suddenly claim to be representing. I can therefore instruct my [[credit officer]] that the only commercial ''bona fides'' she needs to have in mind, as she slips on her rubber gloves, are yours. It doesn’t matter whether the agency arrangement really exists: you are liable, as a principal, to me, it is your problem to recover any money you may be owed by your man in Havana.