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Template:M summ 2002 ISDA Relationship Between Parties: Difference between revisions
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=== Non-Reliance === | === Non-Reliance === | ||
[[Non-Reliance - ISDA Provision|Also]], for good order, in not so many words and for no compelling reason, reproduced in Article {{eqderivprov|13.1}} of the {{eqderivdefs}}. | |||
You might ask why this representation wasn’t included somehow in Section 3 of the {{isdama}}, along with all the other Representations. Perhaps it was an afterthought — though it is hard to udnerstand if so why it made it to the pre-printed schedule. | |||
In any case, the contents of this representation are throroughly uncontroversial: it is designed purely to head off mendacious, buyer’s remorse-inflected regrets at having participated in a transaction in which one has lost money. | |||
The deal is that [[swap dealer]]s, sitting as they do on the public side of the great wall of information barriers that runs down the middle of an investment bank, owe no fiuciary obligations<ref>This rule is progressively honoured in the regulatory breach, by the way, with things like best execution, but it remains the operating theory.</ref> and give no advice and operate at arm’s length — so this is really just a fancy way of saying BUYER BEWARE. If you want ''advice'', go see an investment adviser. | |||
=== Assessment and Understanding === | === Assessment and Understanding === | ||
[[Assessment and Understanding - ISDA Provision|Having]] assured the assembled that you ''have'' understood the {{isdaprov|Transaction}} and taken such advice as you need to determine that it ''is'' suitable, this representation allays the lingering existential doubt your counterparty might have that, notwithstanding your status (represented/determined elsewhere) as a [[qualified institutional buyer]], [[Professional client|professional client]], [[institutional investor]] or whatever other designation of competence a regulator might habitually expect, you might ''still'' be so stupid as to not ''understand'' that you don’t understand the Transaction, or the professional advice you have obtained about that Transaction. One gets comfort by a follow on rep that one is ''capable'' of understanding the merits and risks of the transaction. Neat, tidy, and job done... | |||
... ''except'' there is a whopping great elephant there, standing on a stack of turtles. For how are we supposed to know whether you are capable of determiningwhether you are capable of understanding the merits of the transaction? | |||
Fortunately [[the ’squad]] — and knowing them as we do, we feel they must have been ''sorely'' tempted to keep going at least for a little bit, just to see where it took them — eschewed the opportunity to jump down that rabbithole, and executed a deft, and quite uncharacteristic, kick to touch. | |||
=== Status of Parties === | === Status of Parties === | ||
{{ | [[Status of Parties - ISDA Provision|Just]] to be clear, if the {{isdaprov|Non-Reliance}} and {{isdaprov|Assessment and Understanding}} limbs of the {{isdaprov|Relationship Between Parties}} don’t get you where you need to be, we are not a [[fiduciary]], okay? | ||
Behold: the site of {{icds}} and its nail-gun, peppering a coffin that, we suspect, probably didn’t have a body in it in the first place. | |||