Template:M summ 2016 NY CSA 7: Difference between revisions

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[[7 - NY VM CSA Provision|Quite]] different to the default provision under the {{vmcsa}}, because the NY version is not a {{isdaprov|Transaction}}. This means it needs to have its own {{nvvmcsaprov|Events of Default}} clause, rather than piggy-backing off the {{isdama}}. It also has its own [[grace period]], which defaults to two {{nvvmcsaprov|Local Business Day}}s.
Some interesting things here:
 
{{nyvmcsaprov|7(i)}}: '''Failure to Transfer Collateral''': note the {{nyvmcsa}} bakes in a two {{nyvmcsaprov|Local Business Day}} grace period. This is one LBD ''longer'' than the standard [[grace period]] baked into the {{2002ma}}, and one {{nyvmcsaprov|Local Business Day}} ''shorter'' that the standard [[grace period]] baked into the {{1992ma}}. Which is nice. The English law CSAs don’t have this problem, since they are deemed to be {{isdaprov|Transaction}}s under the ISDA, and therefore inherit the {{isdama}}’s Section {{isdaprov|5(a)(i)}} [[grace period]]s. Which, you would have thought, ''has'' to be the more preferable arrangement. But anyway, Americans (and those of you Brits with {{imcsd}}s, the same goes for you, thanks to Section {{imcsdprov|7}} I am afraid) '''your grace periods might not match'''.
 
{{nyvmcsaprov|7(ii)}}: '''Impermissable dealing''': this one is a doozy: the document, as standard, ''allows'' parties to [[rehypothecate]]. This default triggers if you have amended the document to say you cannot rehypothecate, but then you do anyway. Way to go, {{icds}}.
 
{{nyvmcsaprov|7(iii)}}: '''Other breach of Annex''': this is an analogue to the {{isdama}}’s sweep-up “{{isdaprov|Breach of Agreement}}” under Section {{isdaprov|5(a)(ii)}} — this is the Event of Default you use if you don’t really need to use an Event of Default. Why would ''anyone'' wait 30 days?

Revision as of 17:25, 12 January 2022

Some interesting things here:

7(i): Failure to Transfer Collateral: note the 2016 NY Law VM CSA bakes in a two Local Business Day grace period. This is one LBD longer than the standard grace period baked into the 2002 ISDA, and one Local Business Day shorter that the standard grace period baked into the 1992 ISDA. Which is nice. The English law CSAs don’t have this problem, since they are deemed to be Transactions under the ISDA, and therefore inherit the ISDA Master Agreement’s Section 5(a)(i) grace periods. Which, you would have thought, has to be the more preferable arrangement. But anyway, Americans (and those of you Brits with 2018 English law IM CSDs, the same goes for you, thanks to Section 7 I am afraid) your grace periods might not match.

7(ii): Impermissable dealing: this one is a doozy: the document, as standard, allows parties to rehypothecate. This default triggers if you have amended the document to say you cannot rehypothecate, but then you do anyway. Way to go, ISDA’s crack drafting squad™.

7(iii): Other breach of Annex: this is an analogue to the ISDA Master Agreement’s sweep-up “Breach of Agreement” under Section 5(a)(ii) — this is the Event of Default you use if you don’t really need to use an Event of Default. Why would anyone wait 30 days?

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