Template:Nutshell 2002 ISDA 2(d)(ii)

2(d)(ii) Liability. If the payer :—

(1) is required by law to withhold a non-Indemnifiable Tax;

(2) nonetheless does not do so; and

(3) suffers by direct assessment a liability for that Tax,

then, unless the recipient has satisfied the Tax liability directly, it must reimburse the payer for that liability (plus interest, but not penalties unless it failed to provide tax information required under Section 4(a), or breached any Payee Tax Representations.