Following their publication, ISDA took steps to support the use of the French and Irish agreements on ISDA masters, including the approval of new legal opinions to confirm the applicability of the compensation and accompanying provisions of French and Irish legislation submitted to ISDA documentation. Despite these measures, however, some EU operators have expressed reservations about the use of the IsDA`s director agreement under its Irish and/or French law, which is equivalent to new or old agreements. With respect to the old contracts, the parties might have considered that the benefits of a change in existing legislation do not outweigh the disadvantages of a long-term work of new documents between several counterparties (which could include the reopening of unrelated bargaining points). Companies may also face a number of other major stationery transactions involving their derivatives transactions (for example. B with respect to the new initial margin requirements and the adjustment of interbank interest rates), and an additional project may prove unattractive. Section 2, point c): An amendment has been made to prevent payment networks from being considered innovations. On March 12, 2020, the International Swaps and Derivatives Association, Inc( (“ISDA”) published a model amending agreement allowing parties to an English law governing the isDA Master Agreement to convert the agreement into an equivalent Irish or French version (the “amendment”). The 2007 Lugano Agreement (the Lugano Agreement) applies between the EU, Iceland, Norway and Switzerland. During the TIP PERIOD, the Lugano Convention will continue to apply in the Uk and the United Kingdom. In its negotiating position paper “Our Approach to Future Relations with the EU,” the UK stated that it intended to join the Lugano Convention as an independent contracting party. If the UK accedes to the Lugano Convention, jurisdictional and applicability issues will be resolved. Membership of the Lugano Convention requires the agreement of existing adhesive states.
The British government has announced that Iceland, Norway and Switzerland support the UK`s accession. However, THE UK`s accessions will require EU agreement and will be part of wider trade discussions. The choice between French and Irish legal constructs could depend on the political decision of a counterparty. If one party has a particularly strong negotiating position, the other party could have little choice but to yield to the preferences of the other parties.