ISDA Resolution Stay Omnibus Module

On Sep. 14, ISDA announced launch of new BRRD II omnibus module.

  • ISDA launched a module to ISDA Resolution Stay Jurisdictional Modular Protocol (JMP) to enable compliance with the EU Bank Recovery and Resolution Directive (BRRD).
  • Changes to the directive require recognition of certain powers given to EU resolution authorities to be included in financial contracts governed by third-country laws.
  • Follows EBA Dec. 2020 issued final standards on stay powers in BRRD, see #93372.
  • Resolution Powers
  • Include suspension of payment or delivery obligations, restriction of enforcement of a security interest, suspension of termination rights re regulated entity under resolution.
  • The revised BRRD also clarifies that certain crisis prevention or management measures would not constitute enforcement events or insolvency proceedings.
  • BRRD II Omnibus Module
  • ISDA BRRD II omnibus module covers jurisdictions that have transposed the revised BRRD into national law and have been identified as a priority by market participants,
  • The jurisdictions include Austria, Belgium, Denmark, Finland, France, Germany, Greece, Ireland, Luxembourg, Spain and Sweden; it supersedes earlier French and German modules to the JMP that enabled compliance with local resolution legislation.
  • Other jurisdictions will be added to the omnibus module based on market participant feedback as and when they implement the revised BRRD into local law.
  • Requirement to include language in contracts recognizing resolution stay powers intends to address risk that powers may not be effective in a third-country law.

Regulators ISDA
Entity Types Auditor; B/D; Bank; BHC; Depo; Exch; SIFI
Reference PR, 9/14/2021; Reg 2021/1340; BRRD Dir 2014/59, Reg 806/2014;
Functions Accounting; Financial; Legal; Operations; Reporting; Resolution; Risk; Settlement; Treasury
Countries Global Regulator
Products Banking; Clearing; Commodities; Corporate; Derivatives; Fixed Income; Loan; Securities
Regions Global
Rule Type Guidance
Rule Date 9/14/2021
Effective Date 9/14/2021
Rule Id 115872
Linked to Rule :93372
Reg. Last Update 9/14/2021
Report Section International

Last substantive update on 09/15/2021