Isda Master Agreement Dispute Resolution

Lax &Neville LLP represents investors in arbitration and litigation proceedings against financial firms for which the security or investment product in question is governed by an ISDA framework contract. An ISDA Framework Agreement is a framework contract established by the International Derivatives and Exchange Association (ISDA) to enable institutions and counterparties/clients to enter into complex derivative transactions, including options, swaps, credit default swaps, futures. Generally speaking, a framework contract is a contract in which the parties have previously agreed on most of the conditions governing future transactions. The advantage of a standardized contract, which already contains most of the previously agreed terms, is that it allows financial institutions to quickly design and negotiate complex transactions on incredibly demanding products with parties with whom they have previously done business. While the ISDA framework contract is perhaps the most popular framework contract, there are other similar agreements. A review of decisions communicated by english courts in recent years shows that the most frequent disputes under the ISDA Framework Agreement include disputes over a party`s ability and power to enter into transactions; false sale of claims; disputes relating to the suspension of payments; disputes concerning closure procedures and the calculation of advance payments; and disputes relating to termination clauses and the validity of denunciations and other communications. This is the substantive judgment in English in the long-standing (and transnational) dispute between BNP Paribas S.A. (the bank) and the Italian public-private partnership Trattamento Rifiuti Metropolitani S.p.A. (TRM).

The dispute concerns a 2008 loan granted by a banking consortium (led by the complainant bank) to TRM and the related hedging agreements, which the bank negligently has, according to TRM. The use of arbitration in disputes involving International Exchange and Resolution Association (ISDA) framework contracts has increased in recent years. This has happened in particular since the publication of the ISDA Arbitration Guide in 2013 (“Guide”), which contains a number of standard arbitration clauses to be included in the ISDA calendar. These clauses resulted in the jurisdiction clause in Article 13(b) of the ISDA Framework Contract being replaced by a specific arbitration clause. The court also considered Credit Suisse International`s submissions against Stichting Vestia Groep [2014] EWHC 3103 (Comm), a case related to the ISDA Framework Agreement in which TRM held that TRM generally distinguished between guarantees and mere insurance. Again, the court was not persuaded that this authority continued to move the case forward, given that it was related to Springwell. It has been more than two and a half years since the International Swaps and Derivatives Association (ISDA) published its Arbitration Guide, which contains both general guidance on arbitration procedures and a selection of standard arbitration clauses that can be included in an ISDA framework agreement. . . .

© 2007-2012 Building Owners and Managers Association of California (BOMA Cal)