Background

For many years, ICMA has obtained and annually updated legal opinions on the Global Master Repurchase Agreement (1995 & 2000 versions, as well as the 1995 version as amended by the Amendment Agreement to the 1995 version) from numerous jurisdictions worldwide.
 

2011 GMRA legal opinions

http://www.icmagroup.com/legal1/isma1.aspx
 

Beneficiaries

The 2011 GMRA legal opinions have been obtained by ICMA, for the benefit of ICMA and its members¹. 
 

Scope

The 2011 GMRA legal opinions cover both the enforceability of the netting provisions of the GMRA as well as the validity of the GMRA as a whole.

Furthermore, the opinions address the issue of recharacterisation risk (in respect of both the transfer of securities and the transfer of margin).

Both the UK Financial Services Authority (FSA) and the German Financial Supervisory Authority (BaFin) recognise the effect of netting provisions for regulatory capital and large exposure requirements provided, inter alia, that a reasoned legal opinion has been obtained to the effect that, in the event of a legal challenge, the relevant courts and administrative authorities would find that, where a counterparty fails owing to default, bankruptcy, liquidation or any other similar circumstance, the regulated firm’s claims and obligations pursuant to the GMRA would be limited to a net sum under the law of the relevant jurisdiction(s), and which meets certain other requirements. The opinions which ICMA makes available to its members assist them in fulfilling these regulatory requirements. It remains the responsibility of each member individually to ensure that it meets its specific regulatory requirements.

Members must ensure that the specific opinions on which they seek to rely extend to their particular circumstances and satisfy themselves as to the strength of the opinions and the effect of the assumptions and qualifications contained therein.
 

Format

As in previous years, the opinions have been obtained in a combined format, covering the GMRA on the one hand and the Overseas Securities Lender’s Agreement (October 1994 version), Overseas Securities Lender’s Agreement (December 1995 version), Master Gilt Edged Stock Lending Agreement (1996 versions) and the Global Master Securities Lending Agreement (May 2000, July 2009 and January 2010 versions) (collectively the “securities lending agreements” – “SLAs”) on the other (except for the opinions on India, Slovenia and Thailand, which are GMRA only opinions) and consist of the following parts:

(i) core opinion covering both the GMRA as well as the SLAs (the “Core Opinion”);
(ii) specific appendix covering the GMRA (the “GMRA part”); and
(iii) specific appendix covering the SLAs (the “SLAs part”).
 

1. Anguilla

2. Australia

3. Austria

4. Bahamas

5. Bahrain

6. Barbados

7. Belgium

8. Bermuda

9. Brazil

10. British Virgin Islands

11. Canada

12. Cayman Islands

13. China

14. Croatia

15. Cyprus

16. Czech Republic

17. Denmark

18. England

19. Estonia

20. Finland

21. France

22. Germany

23. Greece

24. Guernsey

25. Hong Kong

26. Hungary

27. India

28. Indonesia

29. Ireland

30. Israel

31. Italy

32. Japan

33. Jersey

34. Kuwait

35. Latvia

36. Lithuania

37. Luxembourg

38. Malta

39. Mexico

40. Netherlands

41. Curaçao and Sint Maarten (formerly Netherlands Antilles)

42. New Zealand

43. Norway

44. Oman

45. Philippines

46. Poland

47. Portugal

48. Saudi Arabia

49. Scotland

50. Singapore

51. Slovakia

52. Slovenia

53. South Africa

54. South Korea

55. Spain

56. Sweden

57. Switzerland

58. Taiwan

59. Thailand

60. Turkey

61. United Arab Emirates

62. USA