The ISDA 2018 US Resolution Stay Protocol (US Stay Protocol) was created to allow market participants to comply with regulations issued by the Board of Governors of the Federal Reserve System (12 C.F.R. §§ 252.2, 252.81-88), the Federal Deposit Insurance Corporation (12 C.F.R. §§ 382.1-7) and the Office of the Comptroller of the Currency (12 C.F.R. §§ 47.1-8) (US Stay Regulations). The US Stay Regulations impose requirements on the terms of swaps, repos and other qualified financial contracts (QFCs) of global systemically important banking organizations (G-SIBs).
The US Stay Protocol enables entities subject to the US Stay Regulations to amend the terms of their covered agreements to ensure that, unless excluded or exempted, their QFCs:
Are subject to existing limits on the exercise of default rights by counterparties under the Orderly Liquidation Authority provisions of Title II of the Dodd-Frank Act and the Federal Deposit Insurance Act; and
Limit the ability of counterparties to exercise default rights related, directly or indirectly to an affiliate of covered entities entering into insolvency proceedings.
The US Stay Protocol has been developed based on the requirements of a safe harbored ‘US protocol’ under the US Stay Regulations.
Click here to download the ISDA 2018 US Resolution Stay Protocol.
Adherence to the US Stay Protocol will be open to ISDA members and non-members beginning during the second half of August 2018. At that time ISDA will also publish ‘Frequently Asked Questions’ with additional background information. Parties will pay a one-time fee of $500 to ISDA for each adherence to the US Stay Protocol. There will not be a cut-off date to the US Stay Protocol. ISDA does, however, reserve the right to designate a cut-off date by giving 30 days’ notice on this webpage.