We would not expect end-users to accept all changes to the 2002 form without changing their schedules. In addition, the transition process from the use of a current agreement on the basis of the 1992 form to the use of an agreement on the basis of the 2002 form should include: (i) the interaction between the documents and trade unions contained therein; (ii) the need to amend other related documents, such as the credit support annex, which may need to be amended to work with the 2002 form or other credit support documents or related operations. (iii) operational, liquidity and credit issues; (iv) the exact wording of the amendments which, even in the case of „market practice“, may not be identical to similar provisions already contained in the agreements concluded and (v) the need for new set-off notices. This article summarizes the main substantive substantive changes from the 1992 form and contains a graph that contains a sectional comparison of sections 3 (presentations), 4 (agreements) and 5 (payment and termination incident events) of the 1992 form and the 2002 form. This update does not provide an exhaustive comparison of all changes from the 1992 form. This is a new section of the 2002 form. See discussion above. We believe that it will take a few months for market participants to determine what changes they wish to make to the 2002 form for their use. Such changes, as is currently the case, are reflected in the „timetable“ of the framework agreement. The new language of the credit event in the event of mergers goes far beyond the 1992 contractual provision.
In particular, the new agreement incorporates many indirect changes of control or substantial changes in capital structures, even if there has been no change of ownership that were not relevant until now. The Framework Agreement was updated in 2002 (known as the 2002 ISDA Framework Agreement). The step towards updating the 1992 agreement has its origins in the succession of crises that hit global financial markets in the late 1990s. These events, including the liquidation of Hong Kong broker Peregrine Investments Holdings and the 1998 Russian financial crisis, tested ISDA documentation to an unprecedented extent. Although ISDA`s documentation has stood up to this test, ISDA has decided to conduct a strategic review of its documentation to see what lessons can be drawn from these events. . . .