Derivatives—ISDA documentation framework

The following Banking & Finance practice note provides comprehensive and up to date legal information covering:

  • Derivatives—ISDA documentation framework
  • Documentation framework
  • ISDA
  • ISDA documentation
  • ISDA documentation hierarchy—dealing with inconsistencies in the documentation
  • Master agreement
  • Versions of the master agreement
  • Signing and dating the master agreement
  • Schedule
  • Credit support documents
  • More...

Derivatives—ISDA documentation framework

The International Swaps and Derivatives Association, Inc. (ISDA) is an association for participants in the derivatives industry. It has developed standard documentation for derivatives. The vast majority of over-the-counter(OTC) derivative transactions are documented using ISDA standard documentation.

This Practice Note explains the key ISDA documents in a typical OTC derivatives transaction, their framework and how they interrelate.

The key documents are:

  1. master agreement

  2. schedule

  3. credit support documents (only applicable if the parties require collateral or security to be provided), and

  4. confirmations

Documentation framework


ISDA is a global association which represents participants in the international privately negotiated OTC derivatives market. Members of ISDA include derivatives dealers, corporations, law firms, among others. Its members are all listed on the ISDA website.

ISDA has produced standardised derivatives documentation. The benefits of having standardised documents are:

  1. the time and cost involved to negotiate and agree derivative transactions have been greatly reduced, and

  2. the use of derivatives has grown

ISDA documentation

The ISDA documentation framework for derivatives involves layers of documentation (often referred to as the ISDA documentation architecture). It is important to understand how each document fits within the framework in order to be able to negotiate the documentation effectively. The key layers of documentation for a trade under the ISDA documentation framework are:

  1. master agreement—a pre-printed umbrella document which includes the boilerplate provisions (unless varied by the schedule to the master agreement)

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