On June 7, 2012, ISDA® announced that it is partnering with Markit to develop technology that will allow counterparties to amend their over-the-counter (OTC) derivatives documentation to comply with the requirements of Title VII of the Dodd-Frank that either:

Title VII creates significant legal and administrative compliance issues because most major dealers have entered into ISDA Master Agreements with thousands of counterparties and many end users may have multiple dealer counterparties. The goal of the joint project is to:

Unlike previous ISDA protocols under which amendments were effected by the delivery of an adherence letter, this protocol will require the parties to deliver a completed questionnaire to each relevant counterparty for amendment and compliance to be effective. The technology-based solution will automate the information gathering process and provide sharing of submitted data and documents to permissioned counterparties.

ISDA and Markit expect to have the questionnaire and reporting framework operational by August 1, 2012 in order to facilitate compliance with Dodd-Frank external business conduct rules scheduled to become effective in October (see Legal Update, Final Rules on Business Conduct for Swap Dealers and Major Swap Participants under Dodd-Frank Issued by CFTC).

Updated versions of the questionnaire will be made available in advance of the other regulatory deadlines that require amendment of ISDA derivatives documentation. ISDA and Markit also expect that the initiative will be adapted to facilitate compliance with regulatory requirements in other jurisdictions as they are finalized.