Blog Overview


 Wednesday 16 June 2021

ISDA publishes new 2021 Definitions

On 14 June 2021 ISDA published an updated version of its definitional booklet for OTC interest rate derivatives.

The current version of this definitional booklet (the ISDA 2006 Definitions) has been updated many times over the years.  There are over 70 supplements.  The 2021 Definitions consolidates these supplements and also incorporates a number of updates to reflect changes in regulation and market practice.

The ISDA 2021 Definitions are expected to replace the ISDA 2006 Definitions from 4 October 2021.  This future implementation date is designed to allow market participants to update their internal systems to capture new and revised elections that have been introduced in the 2021 Definitions and may need to be captured in Confirmations.

What is particularly interesting about this new definition booklet is that it is the first to be published in digital format only and will be accessible on ISDA’s MyLibrary platform.  Updates to the Definitions (which were previously implemented by way of supplements) will be made by republishing a revised consolidated version of the Definitions.

The digital format is designed reduce complexity. Users will not need to review the Definitions as well as multiple supplements to determine the terms that apply to a trade at the time it was executed.  Instead, they can easily access a full version of the Definitions that applied at that time.  Users will also be able to run comparisons between different versions of the Definitions.

This is an interesting new way to manage and maintain definitional booklets which I expect the industry will warmly welcome.

Posted by Abigail Harding

Category: ISDA negotiation

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