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Template:Isda 3(d) summ: Difference between revisions
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The fabulous Section {{{{{1}}}|3(d)}} representation, giving one’s counterparty the right to [[close out]] should any so-designated [[representations]] turn out not to be true. This is sure to occupy an inordinate amount of your [[negotiation]] time — in that it occupies any time at all — because you are as likely to be hit in the face by a live flying starfish in the driest part of the Gobi Desert as you are to close out an {{isdama}} because your counterparty is late in preparing its annual accounts. [[Disclaimer|But that’s a personal view and you may not rely on it.]] | |||
Now you might ask what good an item of {{ | ===What’s that Section {{{{{1}}}|3(d)}} [[representation]] malarkey?=== | ||
If one is required to “[[Furnish Specified Information - ISDA Provision|furnish]]” {{{{{1}}}|Specified Information}} under Section {{{{{1}}}|4}}, two things can go wrong: | |||
*'''No show''': one can ''fail'' to provide it, ''at all'', in which case there is a {{{{{1}}}|Breach of Agreement}}, but be warned: the [[Grace period|period]] before one can enforce such a failure, judged by the yardstick of modern financial contracts, is long enough for a whole kingdom of dinosaurs to [[evolve]] and be wiped out; or | |||
*'''It’s cobblers''': one ''can'' provide the {{{{{1}}}|Specified Information}}, on time, but it can be a total pile of ''horse ordure''. Now, here is a [[trick for young players]]: if your {{{{{1}}}|Specified Information}} is, or turns out to be, false, you have no remedy ''unless'' you have designated that it is “subject to the Section {{{{{1}}}|3(d)}} [[representation]]”. That is the one that promises it is accurate and not misleading.<ref>{{{{{1}}}|Accuracy of Specified Information}}.</ref> | |||
Now you might ask what good an item of {{{{{1}}}|Specified Information}} can possibly be, if Section {{{{{1}}}|3(d)}} ''didn’t'' apply and it could be just made up on the spot without fear of retribution — as a youngster, the [[JC]] certainly asked that question, and has repeated it over many years, and is yet to hear a good answer — but all we can presume is that in its tireless quest to cater for the unguessable predilections of the [[Negotiator|negotiating community]], {{icds}} left this preposterous option open ''just in case''. It wouldn’t be the first time. <br> | |||