Tax Agreement - ISDA Provision
Content and comparisons
Another immaculate outing from the ISDA’s crack drafting squad™ ’92 vintage. Exactly the same in both versions.
Summary
These reps allow the other party to pay without deduction for certain taxes. This covenant puts the onus on the payee (beneficiary) to ensure the other party (who is subject to the authority of the taxing authority in question) is not erroneously passing through moneys that it should withhold and for which it will be personally liable to account to the tax authority. It also gives the aggrieved payer a direct right of action to claim those amounts back off the forgetful payee.