Template:M comp disc EUA Annex (d)(i)(1): Difference between revisions

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'''{{euaprov|Cash Settlement}}''': Trick question. There ''is'' no provision for cash-settlement under the ISDA Emissions Annex. Will that stop counterparties asking you to specify a settlement method? Probably not. Does it matter? Also probably not. What if you ''want'' a cash settlement option? Not out of the ballpark — ones eligibility for EMIR, and as such hedge exempotions, might depend on whether the forward is cash settlable, in theory, or not. There is no good reason for this: it springs from the paranoid brow of those toiler legal counsel who trying to parse the [[De minimis threshold test|eligibility or Emissions derivatives under the refitted delegated regulations of MiFID 2]] — our advice is just don’t go there — but you just never know.
'''[[Situation normal]]... ''': Techy drafting slip from {{icds}}: “Number of Allowances to be Delivered” isn’t a thing: there is “{{euaprov|Number of Allowances}}”, which is the notional size of the {{euaprov|Transaction}}, and then there is {{euaprov|Allowances to be Delivered}} which references the particular number of Allowances to be settled under an {{euaprov|Option}} and thus already builds in a number.
'''[[Situation normal]]... ''': Techy drafting slip from {{icds}}: “Number of Allowances to be Delivered” isn’t a thing: there is “{{euaprov|Number of Allowances}}”, which is the notional size of the {{euaprov|Transaction}}, and then there is {{euaprov|Allowances to be Delivered}} which references the particular number of Allowances to be settled under an {{euaprov|Option}} and thus already builds in a number.

Revision as of 16:47, 19 May 2023

Situation normal... : Techy drafting slip from ISDA’s crack drafting squad™: “Number of Allowances to be Delivered” isn’t a thing: there is “Number of Allowances”, which is the notional size of the Transaction, and then there is Allowances to be Delivered which references the particular number of Allowances to be settled under an Option and thus already builds in a number.

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