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{{anat|isda}} | {{anat|isda}} | ||
So, you were wondering what are the main differences between the {{ | So, you were wondering what are the main differences between the {{1992isda}} and the {{2002isda}}. Well, funny you should ask.<REF>What is that you say? You ''weren’t'' wondering about the differences between the {{1992isda}} and the {{2002isda}}? Well, in that case you might like [[Otto Büchstein]]’s uncelebrated opera, [[La Vittoria della Forma sulla Sostanza]]. | ||
==={{isdaprov|Close-Out Amount}} === | ==={{isdaprov|Close-Out Amount}} === | ||
====Two way payments only==== | ====Two way payments only==== | ||
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*'''{{isdaprov|Credit Support Default}}''': The failure of a security interest granted pursuant to a {{isdaprov|Credit Support Document}} now constitutes a {{isdaprov|Credit Support Default}}. | *'''{{isdaprov|Credit Support Default}}''': The failure of a security interest granted pursuant to a {{isdaprov|Credit Support Document}} now constitutes a {{isdaprov|Credit Support Default}}. | ||
*'''{{isdaprov|Set-Off}}''': The absence of a {{isdaprov|Set-Off}} provision is seen by many as the biggest weakness of the {{1992isda}}. Although the User’s Guide to the {{1992isda}} included an optional {{isdaprov|Set-Off}} provision, the optional provision was not effective unless the parties added the provision to the Schedule to the {{1992isda}}. The {{2002isda}} remedies this concern by including a {{isdaprov|Set-Off}} provision that is similar to the provision included in the User’s Guide. This provision permits the Non- {{isdaprov|Defaulting Party}} to {{isdaprov|Set-Off}} any amounts owing between the parties against any early termination amount. While cross-product {{isdaprov|Set-Off}} is permitted, cross-affiliate {{isdaprov|Set-Off}} is not incorporated into this provision. The User’s Guide also suggested adding a representation to satisfy the requirement that mutuality must exist between the parties for a {{isdaprov|Set-Off}} to be effected. In response to this concern, the {{2002isda}} includes an additional representation in Section 3(g) that both parties are principals in respect of all {{isdaprov|Transaction}}s. | *'''{{isdaprov|Set-Off}}''': The absence of a {{isdaprov|Set-Off}} provision is seen by many as the biggest weakness of the {{1992isda}}. Although the User’s Guide to the {{1992isda}} included an optional {{isdaprov|Set-Off}} provision, the optional provision was not effective unless the parties added the provision to the Schedule to the {{1992isda}}. The {{2002isda}} remedies this concern by including a {{isdaprov|Set-Off}} provision that is similar to the provision included in the User’s Guide. This provision permits the Non- {{isdaprov|Defaulting Party}} to {{isdaprov|Set-Off}} any amounts owing between the parties against any early termination amount. While cross-product {{isdaprov|Set-Off}} is permitted, cross-affiliate {{isdaprov|Set-Off}} is not incorporated into this provision. The User’s Guide also suggested adding a representation to satisfy the requirement that mutuality must exist between the parties for a {{isdaprov|Set-Off}} to be effected. In response to this concern, the {{2002isda}} includes an additional representation in Section 3(g) that both parties are principals in respect of all {{isdaprov|Transaction}}s. | ||
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