20 September 2018

China’s derivatives market and judicial trends

For queries related to the white paper, please contact KWM partners Minny Siu and James Guan.

International Swaps and Derivatives Association, Inc. (ISDA) and King & Wood Mallesons (KWM) jointly released a white paper on “China’s Derivatives Market and Judicial Trends”.

The white paper is a ground-breaking review of judicial trends within the ever-growing Chinese derivatives market. It analyses issues arising from derivative-related disputes and summarises the most common arguments made by Chinese counterparties when disputing their validity. It also gives practical insights on the approaches likely to be adopted by courts and arbitrators in China when hearing derivative-related disputes.

The paper can be accessed here.

Hong Kong partner Minny Siu said, “This paper comes at the right time given the growth of China’s derivative market and the increasing number of disputes arising from derivative contracts. The Chinese government is dedicated to developing its financial markets and provides more opportunities for foreign banks to trade with Chinese counterparties.”

Commenting on this collaboration with ISDA, Shanghai-based litigation specialist in derivative-related disputes, James Guan said, “We are very proud to have co-authored this paper with ISDA and share our extensive experience in representing local and foreign clients in China’s financial markets and landmark derivative disputes”.

“The white paper is a practical guide and will help foreign and Chinese institutions map the threshold issues in writing business with PRC counterparties and then managing disputes. KWM is in a unique positon to connect our international derivative experience with our leading PRC network of derivative and litigation specialists. We are delighted to have worked with ISDA on this project and leverage our international and domestic PRC network” the Hong Kong banking team head, Richard Mazzochi commented.

This paper marks another collaboration between KWM and ISDA on Chinese law. In 2016, a cross-border KWM team advised ISDA on its first China Collateral Memorandum and in 2017 on its Close-out Netting Memo and the Sovereign Netting Opinion.

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