The Schedule to the ISDA Master Agreement continues to be a routinely and heavily negotiated document. This presents a number of challenges to firms, including:
Today, firms typically rely on their own customized templates and negotiation guides. These positions may conflict or be incompatible with those maintained by other firms, leading to lengthy contract negotiation and delaying client on-boarding.
Bespoke provisions may often need to be manually recorded and validated making it difficult to use electronic data capture systems to accurately capture and manage legal agreement data.
Interoperability between different systems that are designed to capture and monitor different aspects of the contracts – whether for liquidity, credit risk management or netting purposes – are likely to be impeded if contract data is bespoke and not easily tracked across those different systems.
To address these challenges, ISDA has launched a new project – the ISDA Clause Library Project – to identify provisions within the Schedule to the ISDA Master Agreement that may benefit from further standardization.
As part of this project, ISDA will identify opportunities for creating standard form drafting options in respect of these provisions. ISDA believes that the introduction of industry validated clause wording will reduce legal and operational risk, allow for the development of a standard legal agreement data model and will create a foundation for the development of new technologies, such as distributed ledger technology and smart contracts.
This webinar provides an overview of the ISDA Clause Library Project. Read the PDF below for additional information on the launch of the ISDA Legal Technology Working Group and the ISDA Clause Library Project.