To the extent that material confidential information does not fall within the scope of an existing agreement between the parties (or in the absence of such an agreement), Article 2.15 establishes an agreement between the parties on the limitations and permitted uses of such information under the new regulatory standard. Whether or not the parties have an existing agreement (and therefore fall under Article 2.14 or 2.15), they may, on a bilateral basis, accept any other condition that applies to the material confidential information they choose. The Protocol aims to complement existing written agreements on the terms of one or more swap operations. The Protocol adds notices, representations and undertakings that meet the requirements of Title VII of the Dodd-Frank Act and must be complied with at or before the time the swap transactions are offered and executed. The Protocol is not limited to ISDA framework agreements and can be used to amend any agreement between two parties under which they enter into swaps. See below for the procedure required for each pair of parties to amend its existing framework agreement using the Protocol. As mentioned earlier, DF protocols are not limited to ISDA framework agreements and can therefore be used to modify any exchange agreement between an SD or MSP and a counterparty. The August Protocol is limited to existing written agreements between the parties, but the parties may choose to apply to undocumented swaps by entering into an agreement on the terms of the DF. The March Protocol allows the parties to enter into an agreement on the application of certain compliance provisions to their business relationships for swaps that are not (i) subject to a written agreement that provides, inter alia, for the terms of the parties` payment obligations, or (ii) that have been agreed by the parties to be cleared by a clearing house. Market participants comply with the DF protocols by following the instructions posted on the ISDA website, including filing a letter of adhesion, proof that the agreement is bound by a specific DF protocol, and paying a $500 fee.

Any party that files a letter of membership and pays the associated fees is a member party. A list of adherent parties is published on the ISDA website for each of the DF protocols. Each subscribing party (also known as the protocol participants) must also complete a questionnaire that allows it to provide information about itself and to conduct certain elections. The delivery of a completed questionnaire to another member party makes it possible to add additional conditions that are in force for this member party. To meet these bilateral delivery requirements, ISDA has partnered with Markit Group Limited to create „ISDA Amend”, an automated information collection process that allows data and documents to be submitted for sharing with counterparties for which authorization has been granted. This system of bilateral delivery requirements differs from previous ISDA protocols. While most of the rules adopted as a result of the Dodd-Frank Act apply to U.S. DS and MSPs (and are in fact intended to benefit their counterparties and not impose a direct administrative burden), some rules also affect Canadian market participants who do not necessarily trade swaps or speculate on swaps, but which are rather counterparties to swap arrangements as a means of hedging commercial or investment risks.

In order for SDs to comply with the Rules of Business Conduct under the August Protocol, including the confirmation of counterparty eligibility standards and the determination of the availability of safe havens, SDs require all Canadian counterparties to provide them with certain information and assurances by May 1, 2013. In order to comply with the rules of business conduct, DS may only enter into swap transactions with counterparties that have provided the necessary information and assurances. Therefore, the annexes to the isda framework agreements provided by the SDs contain more and more provisions such as the following: The agreement on the isda-DF general conditions of August 2012 (the „agreement on the conditions of the DF”) has the limited purpose of allowing the parties to apply certain provisions of the DF supplement to their business relationship with regard to swaps, whether or not such a relationship is governed by an existing written agreement. Like the DF supplement, the DF Terms of Service Agreement is designed to be used by any pair of parties, provided that at least one of the parties is a swap trader. As with previous Dodd-Frank protocols, market participants can adhere to SBS 2021 or the U.S. self-disclosure letter by visiting ISDA`s website at www.isda.org and entering the required information online or signing an equivalent bilateral agreement with an SBSD. Like the August Protocol, the March Protocol is designed to facilitate compliance with the CFTC`s Dodd-Frank-based rules by providing an efficient and standardized way to modify swap agreements. The March Protocol (also known as Protocol DF 2.0) is intended to meet the requirements of three rules that were completed too late to be covered by the August Protocol, namely: (i) the exemption for end-users from the clearing obligation for swaps, (ii) the determination of the clearing requirement requiring set-off for certain categories of interest rate swaps and swaps on the risk of credit; and (iii) a rule for DSMs and PSM that governs requirements for confirmation, portfolio reconciliation, portfolio compression and documentation of swap trading relationships. One. Establishes an agreed process to amend agreements governing the terms of one or more swap transactions and/or enter into a „DF Terms Agreement” (described in detail below). Each of these agreements is defined as an „agreement transferred by protocol”.

The basic architecture consists of four documents, each described as described below: (I) a letter of compliance, (II) the questionnaire, (III) the Memorandum of Understanding and (IV) the DF supplement. In addition, a fifth document, the agreement on the terms of the DF, extends the basic architecture of the protocol to situations in which the parties may wish to exchange without benefiting from a pre-executed framework agreement between them. The agreement on the terms of the DF is explained in detail in questions 16 to 20 below. (a) The parties may execute swaps that are not covered by an existing ISDA framework agreement, an execution agreement (e.B. the agreement to sign fia swaps) or any other written agreement between the parties (such swaps, „undocumented swaps”), including swaps executed by a party to be cleared or swaps executed to be „delivered” to an external derivatives dealer or a „principal broker”, or under the Protocol, the parties provide information and make representations, to meet new regulatory requirements for swap traders. The objective of the protocol is to provide the parties with an effective and standardized method of meeting the new compliance requirements, rather than creating additional (and possibly unforeseen) contractual remedies under existing bilateral treaties. .