June 12, 2020

Solve Your OTC Pre-Trade Legal Due Diligence Challenges with AOSphere

Prior to entering into OTC derivatives contracts your firm needs to know facts about your potential counterparty including:

  • Are they formally authorised to enter into OTC transactions? (legal capacity) (For an example where this went wrong read more about Hammersmith and Fulham Council)
  • Are there regulatory consents for the products?
  • Are there any regulations covering approvals, gambling or insurance relevant?
  • Are ISDA contract enforceable in their local jurisdiction?
  • Are electronic signatures allowed?
  • Are electronic records admissible in court?

All of this (and more) is available via ISDA and AOSphere using their new on-line services.  ISDA and aosphere LLP have launched a new service that will enable users to quickly and efficiently assess issues relating to the enforceability of electronically executed and confirmed contracts across the globe.

The tool, called diligence – ISDA e-contracts, covers ISDA’s e-contract opinions and allows ISDA members to rapidly view factors relating to the use of electronic contracts, e-signatures and click-through agreements in an intuitive color-coded web format, including enforceability and admissibility of electronic records in court proceedings. The tool is hosted on the aosphere platform, which also hosts other services that analyze ISDA opinions including netalytics and CSAnalytics.

The launch of the service reflects the increasing number of derivatives, securities financing and repo transactions that are being executed and confirmed electronically. The coronavirus pandemic has further heightened interest in e-contracts, with the closure of offices and the introduction of remote working highlighting challenges and inefficiencies associated with the physical delivery of signed paper documents and notices.

In response, ISDA has expanded the scope and jurisdictional coverage of its e-contract opinions. Thirty seven jurisdictions are currently covered, with a further 10 commissioned this year.

For more information on ISDA’s e-contract opinions, visit the ISDA website.

For more information on diligence – ISDA e-contracts or to request a trial or demo, visit the aosphere website.

Photo by Kelly Sikkema on Unsplash

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