ISDA has published the first in a series of legal guidelines for smart derivatives contracts, intended to explain the core principles of ISDA documentation and to raise awareness of important legal terms that should be maintained when a technology solution is applied to derivatives trading.
The first introductory paper outlines some potential smart derivatives contract models, sets out principles for the development of smart derivatives contracts, and identifies contractual and documentation issues that may be relevant in the development and implementation of new technology platforms, products and solutions for use within the derivatives industry.
Further papers will follow that will provide more detailed analysis on specific ISDA documents, starting with the ISDA Master Agreement.
These guidelines are not intended to specify or recommend any particular approach, or address any particular technological application or project. Rather, they are intended to provide high-level guidance on the legal documentation and framework that currently governs derivatives trading, and to point out certain issues that may need to be considered by technology developers when introducing technology into that framework.
Click on the PDF below to read the introductory paper.