Counterparty Definition

GLOSSARY

What does Counterparty mean?

The other party to a transaction.

For pensions funds there are increasing concerns that creative investments (such as swaps or other derivatives) may be made on their behalf by their investment bank advisers with organisations which may fail (were there to be a financial crisis) before they could fulfil their part of the bargain. Counterparty risks are generally underrated and underpriced.

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ISDA documentation in a finance transaction—checklist

ISDA documentation in a finance transaction—checklist This checklist sets out the key ISDA documentary requirements which need to be considered during the course of a financing transaction. Term sheet stage • if acting for a borrower and specialist hedging advisors are instructed, get their input on the term sheet • if acting for a borrower, ensure that the overall pricing of the transaction is understood (across both the loan and the hedging). A borrower may choose a particular lender based on a low margin offered on the loan, but then find that the credit spread on the swap offered by the same lender means that the overall economics of the transaction are less attractive than those offered by a different lender • is the loan and hedging on an IBOR basis (eg EURIBOR) or on a risk free rate (eg SONIA)? Will the loan transition from an IBOR to a RFR during its term and, if so, how will the hedging be dealt with? • does the lender require a...

Bank Recovery and Resolution Directive (BRRD)—timeline [Archived]

Bank Recovery and Resolution Directive (BRRD)—timeline [Archived] Archived:This timeline has been archived. For developments from January 2024 onwards, see EU Bank Recovery and Resolution Directive—timeline if they relate to the EU BRRD, or UK bank recovery and resolution regime—timeline if they relate to the UK bank recovery and resolution regime, For further guidance on the EU BRRD, see Practice Note: Bank Recovery and Resolution Directive (BRRD)—essentials. For further guidance on the UK bank recovery and resolution regime, see Practice Note: The UK bank recovery and resolution regime. Date Source Document Description 20 December 2023 European Banking Authority The EBA publishes amendments to disclosures and reporting on MREL and TLAC The European Banking Authority (EBA) has published its final draft implementing technical standards (ITS) on amendments to disclosure and reporting of the minimum requirement for own funds and eligible liabilities (MREL) and the total loss absorbency requirement (TLAC). The amendments reflect the new requirement to deduct investments in eligible liabilities instruments of entities belonging to the same resolution group, the...

Money Laundering Regulations 2017—CDD quick reference guide—individuals

Money Laundering Regulations 2017—CDD quick reference guide—individuals Client due diligence (CDD) is a central pillar of the anti-money laundering (AML) and counter-terrorist financing (CTF) regime. CDD requirements underpin the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), SI 2017/692, as amended. Counter-proliferation financing is the most recent addition to the long-established AML and CTF regime. Requirements in relation to counter-proliferation financing were introduced through amendments to the MLR 2017 and include in relation to systems and controls, risk assessment, etc. No specific counter-proliferation financing requirements were added in relation to CDD, and existing CDD provisions in the MLR 2017 were not amended to include mention of proliferation financing. As things stand, therefore, counter-proliferation financing is not covered in this Practice Note. For more information, see Practice Note: Counter-proliferation financing—CPF—the basics. Where the MLR 2017 apply (see Practice Notes: Money Laundering Regulations 2017—scope and application—law firms), conducting CDD is an absolute requirement. It is not in itself subject to the risk-based approach....

Energy legislation tracker 2017 [Archived]

Energy legislation tracker 2017 [Archived] ARCHIVED: This Practice Note has been archived and is not maintained. This Energy legislation tracker tool displays key upcoming legislation of interest to Energy lawyers from 1 January 2017. The tracker is divided into the following jurisdictions: • England and Wales • European Union Legislation will be displayed in reverse chronological order. Legislation that is only applicable to Wales will be indicated on the tracker. England and Wales Title Key date Topics See Details Ionising Radiations Regulations 2017SI 2017/1075 1 January 2018Comes into force • Nuclear licensing and regulation In force The Regulations set out a framework to ensure that occupational exposures to ionising radiations are kept as low as is reasonably practicable. The occupational elements of Directive 2013/59/Euratom laying down basic safety standards for protection against the dangers arising from exposure to ionising radiations are transposed. The Ionising Radiations Regulations 1999 are revoked. See: The occupational elements of Directive 2013/59/Euratom laying down basic safety standards for protection against the dangers arising...

Discover our 625 Practice Notes on Counterparty

Ireland—Notice of assignment of contract—from assignor

Ireland—Notice of assignment of contract—from assignor [Headed notepaper of the assignor] To: [Insert name and address of recipient (ie the other party to the contract that was assigned)] [Insert date] This Precedent is a letter notice of assignment, which informs a party to a commercial contract that the other party (the assignor) has assigned all or part of its rights, title, benefit and interest in the contract to a third party (the assignee). It assumes that the commercial contract which was assigned is governed by the laws of Ireland. In the case of an assignment of contractual rights, giving the contract counterparty written notice of the assignment is one of the key requirements for the creation of a statutory assignment under section 28 of the Supreme Court of Judicature Act (Ireland) 1877 (SCJA(I) 1877 (IRL)) (ie an assignment which takes effect as a legal assignment). Section 28 of SCJA(I) 1877 (IRL) does not include any specific requirements about the form of the notice which needs to be given. This Precedent...

Financial sanctions organisation-wide risk assessment

Financial sanctions organisation-wide risk assessment 1 Introduction 1.1 We have performed an organisation-wide risk assessment of the areas where we are most at risk of breaching financial sanctions or being exposed to customers subject to financial sanctions. This document records the risks we have assessed and conclusions we have reached, including how we will mitigate the risks. The person responsible for this assessment is [insert name/role]. 1.2 Our assessment included consideration of: 1.2.1 our customers and their counter-parties; 1.2.2 the geographical areas we operate in[, including sanctions regimes in other countries in which we operate]; 1.2.3 the [services AND/OR products] we offer; 1.2.4 our internal or operational risks. 2 Overview of the organisation Size and nature of the organisation [Insert details] Staff [Insert details eg headcount, composition of staff base, staff turnover, supervisory structure and any other relevant employee metrics] Description of practice areas and their relative size/significance to the business [Insert details] Customer types [Insert details ie, are your customers individuals, UK corporate entities,...

Dive into our 72 Precedents related to Counterparty

A client is letting a property to a tenant who is the Secretary of State for a UK government department. What is the correct form of execution of a deed by the Secretary of State? The tenant’s solicitor proposes to execute the document by way of affixing the seal of the Secretary of State to the document together with a signature of an authorised person. Is there authority to do this?

A client is letting a property to a tenant who is the Secretary of State for a UK government department. What is the correct form of execution of a deed by the Secretary of State? The tenant’s solicitor proposes to execute the document by way of affixing the seal of the Secretary of State to the document together with a signature of an authorised person. Is there authority to do this? Government departments and government ministers (when acting in their official rather than their personal capacity) are generally regarded as emanations of the crown, which itself is considered to be a corporation sole. A corporation sole consists of one person and their successors in some particular office or station, who are incorporated by law in order to give them certain legal capacities and advantages which they would not have in their natural person. Execution of deeds by a corporation sole is not regulated by section 46 of the Companies Act 2006, nor section 74(1) of the Law of...

Does section A21 of the Insolvency Act 1986, which places restrictions on the legal and enforcement proceedings that may be commenced against a company subject to the new ‘moratorium’, prevent a party to a construction contract commencing or enforcing adjudication against a counterparty that is subject to the moratorium?

Does section A21 of the Insolvency Act 1986, which places restrictions on the legal and enforcement proceedings that may be commenced against a company subject to the new ‘moratorium’, prevent a party to a construction contract commencing or enforcing adjudication against a counterparty that is subject to the moratorium? Section 1 of the Corporate Insolvency and Governance Act 2020 (CIGA 2020) introduces a new Part A1 to the Insolvency Act 1986 (IA 1986), which enables eligible companies to apply for a statutory moratorium. The moratorium is designed to allow viable businesses time to restructure or seek new investment, free from creditor action. In terms of IA 1986, s A21, during the moratorium, ‘(e) no legal process (including legal proceedings, execution, distress or diligence) may be instituted, carried out or continued against the [eligible] company, except…(iii) with the permission of the court’. Before considering further how this might impact on the ability of a party to a construction contract, to either commence an adjudication against a counterparty who...

See the 36 Q&As about Counterparty

Energy weekly highlights—12 December 2024

This week's edition of Energy weekly highlights includes: two news analyses on (i) key UK and international climate litigation developments in 2024, with a focus on the energy sector and potential trends for 2025 and beyond and (ii) the outcomes of the 29th Conference of the Parties to the UN Framework Convention on Climate Change (COP29). The Prime Minister, Sir Keir Starmer, also announced a comprehensive Plan for Change, outlining key milestones to deliver national missions by the end of the current parliament, including securing home-grown energy and aiming for at least 95% of clean power generation by 2030. In addition, this week, the Department for Energy Security and Net Zero (DESNZ) announced the signing of contracts for the UK's first carbon capture, usage and storage (CCUS) projects in Teesside, accompanied by the North Sea Transition Authority (NSTA) awarding the UK’s first carbon storage licence to the Northern Endurance Partnership for its Endurance site located off the Teesside coast. DESNZ also published the response to its December 2023 consultation on...

Environment weekly highlights—12 December 2024

This week's edition of Environment weekly highlights includes: news analysis on the 29th Conference of the Parties of the United Nations Framework Convention on Climate Change (COP29) outcomes, some of the key UK and international climate litigation developments in 2024 pertaining to the energy sector, the key takeaways and what is on the horizon for 2025 and beyond and insured losses from natural catastrophes projected to pass US$135bn in 2024, marking the fifth consecutive year in which the total exceeded US$100bn, according to a report by the Swiss Re Institute. It also covers Friends of the Earth (FoE), along with co-claimants, Doug Paulley and Kevin Jordan’s appeal against the High Court's October 2024 decision, which dismissed their legal challenge to the UK government's National Adaptation Programme 3 (NAP3) and the United Nations Environment Programme (UNEP)’s adjournment of negotiations for a legally binding global treaty on plastic pollution until 2025, following the conclusion of the fifth session in Busan, South Korea. In additions this week, the Department for Energy Security and...

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GLOSSARY