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Definitions: Difference between revisions
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'''What''': Use definitions: | '''What''': Use definitions: | ||
*'''To save repetition''': An expression which is (a) wordy and (b) appears a LOT in the agreement. If it only appears twice or three times, why define it? “Securities, financial instruments or other financial assets standing to the credit of the custody account” is harder to get through than “Custody Assets”. Though query do you need to define this at all? after all, what else could you realistically mean by “[[custody assets]]”? | *'''To save repetition''': An expression which is (a) wordy and (b) appears a LOT in the agreement. If it only appears twice or three times, why define it? “Securities, financial instruments or other financial assets standing to the credit of the custody account” is harder to get through than “Custody Assets”. Though query do you need to define this at all? after all, what else could you realistically mean by “[[custody assets]]”? | ||
*'''To create a new technical expression that doesn’t otherwise have any meaning''': Let’s say US accounting rules require an investor has the right to exchange its asset-backed security for the beneficial interest in the assets underlying the note. (Well, you never know, right?) You might call this the “BIE Option”. Sure, | *'''To create a new technical expression that doesn’t otherwise have any meaning''': Let’s say US accounting rules require an investor has the right to exchange its asset-backed security for the beneficial interest in the assets underlying the note. (Well, you never know, right?) You might call this the “BIE Option”. Sure, it’s confusing, but no more confusing than the actual obligation in the first place. | ||
*To gather together disparate concepts into a single expression and it would not otherwise be obvious. | *To gather together disparate concepts into a single expression and it would not otherwise be obvious. | ||
'''When not to use definitions''': When the defined term is obvious. Everyone knows that the [[EU]] means the [[European Union]]. Everyone knows [[MiFID 2]] means. Everyone (right?) knows what [[ERISA]] means. | '''When not to use definitions''': When the defined term is obvious. Everyone knows that the [[EU]] means the [[European Union]]. Everyone knows [[MiFID 2]] means. Everyone (right?) knows what [[ERISA]] means. | ||