Private International Law Aspects of Derivatives Contracts Involving DLT

These four papers consider the private international law, or conflict-of-law, aspects of derivatives contracts involving distributed ledger technology (DLT), commonly known as blockchain technology.

The development and implementation of new technologies such as DLT within the derivatives industry have the potential to create a more robust financial markets infrastructure, achieve operational efficiencies through increased automation and reduce costs for market participants.

As these technologies mature, it is important to understand the evolving legal treatment of derivatives traded on DLT platforms. Given the novel complications over where data, assets and even counterparties are located in a DLT environment, it is useful to examine key questions on how to determine which law applies and how to evaluate conflicts of governing law. While some jurisdictions have produced analysis on areas of perceived legal uncertainty, these issues remain untested in many of the jurisdictions and cross-border environments important to the derivatives industry.

In January 2020, ISDA, R3, Clifford Chance and the Singapore Academy of Law jointly published Private International Law Aspects of Smart Derivatives Contracts Utilizing Distributed Ledger Technology. That paper considered the private international law, or conflict-of-law, aspects of derivatives contracts governed by the laws of England and Wales or Singapore involving DLT.

As a result, ISDA (in association with R3 and local counsel) has published additional papers that consider these issues from French, Irish, Japanese and New York law perspectives.

Read the papers and a jurisdiction comparison table by clicking on the PDFs below.

Joint Paper on UK EMIR Reform

On July 1, ISDA and UK Finance published a paper, which recommended a set of reforms for the UK European Market Infrastructure Regulation (UK EMIR), carefully considering each EU EMIR 3.0 reform and asking whether we would wish to adopt...

Response to FCA on UK EMIR Reporting

On June 30, ISDA submitted a response to chapter 5 of the UK Financial Conduct Authority’s (FCA) quarterly consultation CP25/16 on trade repository reporting requirements under the UK European Market Infrastructure Regulation (UK EMIR). Chapter 5 proposes ‘Amendments to the...

CDS Trading Activity in EU, UK and US Markets

This report analyzes credit derivatives trading activity reported in Europe. The analysis shows European credit derivatives transactions based on the location of reporting venues (EU versus UK) and product type. The report also compares European-reported credit derivatives trading activity to...