Open from December 22, 2020
The 2020 UK (PRA Rule) Jurisdictional Module (the 2020 UK Module) to the ISDA Resolution Stay Jurisdictional Modular Protocol enables entities subject to the UK Prudential Regulation Authority (UK PRA) rule on contractual stays in financial contracts governed by third-country law to amend the terms of their Covered Agreements with certain counterparties to comply with the UK PRA rule, by obtaining from such counterparties a contractual recognition of the application of stays on or overrides of termination rights under the UK Banking Act, as required by the UK PRA rule.
Pursuant to the European Union (Withdrawal) Act 2018 (as amended from time to time) certain EU law (and EU-derived domestic legislation) will be retained in UK domestic law from 31 December 2020. As part of that process certain amendments have been made to the ‘Stay In Resolution’ part of the PRA rulebook (the 2020 PRA Rule). The 2020 UK Module has been created to allow market participants to comply with the 2020 PRA Rule.
ISDA previously published on 3 May 2016 the UK (PRA Rule) Jurisdictional Module (the 2016 UK Module). Please refer to the “Frequently Asked Questions” tab for more information on the differences and interaction between the 2016 UK Module and the 2020 UK Module.
The 2020 UK Module is open to ISDA members and non-members. Parties will pay a one-time fee of $500 to ISDA for each adherence to the 2020 UK Module. There is no cut-off date to the 2020 UK Module. ISDA does, however, reserve the right to designate a cut-off date by giving 30 days’ notice on this site.
ISDA has prepared this list of frequently asked questions to assist in your consideration of the 2020 UK (PRA RULE) JURISDICTIONAL MODULE to the ISDA RESOLUTION STAY JURISDICTIONAL MODULAR PROTOCOL (the ISDA Jurisdictional Modular Protocol).
THESE FREQUENTLY ASKED QUESTIONS DO NOT PURPORT TO BE AND SHOULD NOT BE CONSIDERED A GUIDE TO OR AN EXPLANATION OF ALL RELEVANT ISSUES OR CONSIDERATIONS IN CONNECTION WITH THE 2020 UK (PRA RULE) JURISDICTIONAL MODULE. PARTIES SHOULD CONSULT WITH THEIR LEGAL ADVISERS AND ANY OTHER ADVISER THEY DEEM APPROPRIATE PRIOR TO USING OR ADHERING TO THE 2020 UK (PRA RULE) JURISDICTIONAL MODULE. ISDA ASSUMES NO RESPONSIBILITY FOR ANY USE TO WHICH ANY OF ITS DOCUMENTATION MAY BE PUT.
These FAQs address the following questions:
- What is the purpose of the 2020 UK (PRA Rule) Jurisdictional Module?
- What changes have been made to the 2016 UK Module in the 2020 UK (PRA Rule) Jurisdictional Module?
- What is the effect of adhering to the 2020 UK (PRA Rule) Jurisdictional Module where I have previously adhered to the 2016 UK Module?
- What is the effect of adhering to the 2020 UK (PRA Rule) Jurisdictional Module where I have previously incorporated by reference the 2016 UK Module into agreements?
- How does adherence to the 2020 UK (PRA Rule) Jurisdictional Module and the ISDA Jurisdictional Modular Protocol work?
- How does the 2020 UK (PRA Rule) Jurisdictional Module relate to the 2020 PRA Rule?
- Why are certain terms in italics?
- What agreements are Covered Agreements under the 2020 UK (PRA Rule) Jurisdictional Module?
- What entities are Regulated Entities under the 2020 UK (PRA Rule) Jurisdictional Module?
- When does the 2020 UK (PRA Rule) Jurisdictional Module become effective?
- How do I sign up to the 2020 UK (PRA Rule) Jurisdictional Module?
The ISDA Jurisdictional Modular Protocol is designed to facilitate market participants’ compliance with regulations regarding contractual stays in financial contracts governed by third-country law in different jurisdictions. As regulations are adopted in a jurisdiction, a “Jurisdictional Module” to the ISDA Jurisdictional Modular Protocol could be published that would include operational provisions based on the text of that regulation and aimed at enabling parties to comply with those requirements. A party will be able to adhere to a particular Jurisdictional Module by submitting an Adherence Letter for such Jurisdictional Module. Each Jurisdictional Module will be considered individually. For more information on the ISDA Jurisdictional Modular Protocol and adherence to the ISDA Jurisdictional Modular Protocol, please see the general FAQs for the ISDA Jurisdictional Modular Protocol.
The 2020 UK (PRA Rule) Jurisdictional Module was published as a Jurisdictional Module to the ISDA Jurisdictional Modular Protocol on 22 December 2020.
You can download the full FAQ here.
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