Through the years, arbitration as a mode of dispute resolution has gained prominence because it promotes party autonomy with minimal court intervention, amongst others.
Anyone with a passing knowledge of derivatives law will be aware of the controversy created by section 2(a)(iii) of the ISDA Master Agreement.1 Differing interpretations of 2(a)(iii) have emerged in litigation in London and the United States since the collapse of Lehman Brothers. The recent judgement of the Court of Appeal in London in Lomas v. JFB Firth Rixson Inc2 brings significant clarity from the English perspective. The decision upholds the interpretation of section 2(a)(iii) favoured by the derivatives market.
Under the 2000 version of the Global Master Repurchase Agreement (the "GMRA"), a standard form agreement produced by The Bond Market Association and the International Securities Market Association, an Event of Default occurs, and all outstanding transactions under the GMRA are accelerated immediately, upon:
Government bonds were long considered a safe investment that offered the potential for high returns. However, after Argentina announced in 2002 that it would no longer service its bond debt and after Greece restructured its sovereign debt in March and December 2012, the question arises as to what investors can do to avoid the significant losses of capital (up to 70% in case of Argentina and over 80% in case of Greece) which almost always accompany sovereign debt restructurings.
ISDA is pleased at how the industry infrastructure for CDS worked in the context of the Lehman default and settlement. It also pointed out the misperceptions about the role of CDS in the financial crisis.
1 Advantages to aircraft financiers
For an aircraft financier, the virtues of the Cape Town Convention and its Aircraft Equipment Protocol (together Cape Town) are that it aims to:
On Monday, the International Swaps and Derivatives Association, Inc. (ISDA) announced that it will issue a CDS auction protocol regarding the settlement of credit derivatives that reference Smurfit-Stone Consolidated Enterprise Inc. The protocol is a response to Smurfit-Stone’s recent filing for reorganization under Chapter 11 in the US Bankruptcy Court in Wilmington, Delaware.
An examination of the impact of an insolvent respondent in an arbitration.
In 2008, the catastrophic effect of the credit crunch spread to most world economies, touching governments, companies and individuals alike. As in previous recessions, insolvency is affecting increasing numbers of individuals and companies. UK government figures show that individual insolvencies went up by 8.8% in the third quarter of 2008, with corporate liquidations up by 10.5% in the same period. Commentators predict that this trend will only accelerate through 2009.
Given the current worldwide economic climate, the number of companies facing insolvency that have assets in multiple jurisdictions around the world has increased dramatically. It is not unusual in today’s global economy for a corporation to have commercial offices, production plants and/ or research facilities in many different countries. A company that is faced with the bleak picture of insolvency may be forced to make decisions on whether to seek protection under a number of different statutory structures.
As previously reported, the International Insolvency Institute will hold its Ninth Annual International Insolvency Conference at Columbia University in New York on June 18 and 19, 2009. This Conference is likely to be the finest international insolvency Conference of the year and has an exceptionally talented and prominent faculty that will address today’s critical international insolvency issues and developments. Among the highlights of the Conference are the following: