Brexit prompts swaps and derivatives body to launch French and Irish law master agreements
The International Swaps and Derivatives Association (ISDA) has launched new French and Irish law versions of the ISDA Master Agreement, adding to the existing English, New York and Japanese law choices ahead of Brexit.
The new Master Agreements are intended to provide options for those institutions that would prefer to continue trading under a European Union member-state law with EU court jurisdiction clauses once the UK leaves the EU.
English law may become a third-country law after the UK withdraws from the EU, which means English court decisions would no longer be automatically recognized and enforced across the EU and European Economic Area (EEA).
That would not be the case for French or Irish law court judgments under the new master agreements.
“An English law master agreement won’t become any less valid in the EU post-Brexit, irrespective of the outcome of the Brexit negotiations. There will be good reasons for EU/EEA counterparties to continue using the English law Master Agreement, and there will be good reasons for them to start using the French and Irish law versions. This is all about providing choice to the market and allowing counterparties to choose the option that best suits their needs,” said Katherine Tew Darras, ISDA’s general counsel.