Template:Set-off and netting: Difference between revisions

*'''[[Close-out netting]]''', in the learned words of [[Allen & Overy]], is a contractual process comprising [[early termination]], [[valuation]] and determination of a net balance. This last step may involve a [[contractual set-off]] but, saucily, the considered view of ISDA’s counsel for England and Wales is that the net effect of the agreement is to arrive a a net balance ''without'' the good offices of contractual set-off<ref>Sigh - except where there are unpaid amounts payable under Section {{isdaprov|2(a)(i)}}. You knew there’d be some kind of qualification though, didn’t you.</ref>  According to the [[International Institute for the Unification of Private Law|UNIDROIT]]<ref>[https://www.unidroit.org/instruments/capital-markets/netting “Principles on the operation of close-out netting provisions”</ref>, close-out netting resembles the classical [[insolvency set-off]], but is purportedly wider: general [[set-off]] requires mutual debts that are already due, while [[close-out netting]] envisages the netting of obligations that are ''not'' yet due.<ref>The {{isdama}} achieves this by accelerating them, mind.</ref> Thus, [[set-off]] is narrower that close-out netting.