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Better OTC Contracts for Global Banks

Smarter, faster legal contracts

Thomson Reuters + Clifford Chance

Lucinda Case, Managing Director, Legal for United Kingdom & Ireland, Thomson Reuters
Bas Boris Visser, Global Head of Innovation & Business Change, Clifford Chance

Financial institutions have had to manage significant regulatory change, with more still ahead.

Example: New rules introduced in 2016 in the over-the-counter (OTC) derivatives market require banks to hold extra collateral or margin to cover the risk associated with uncleared derivatives transactions. To comply, banks and asset managers face the enormous task of amending the terms of existing contracts with counterparties and reframing new contracts.

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Thomson Reuters and preeminent global law firm Clifford Chance partnered to help these global financial institutions get the job done more quickly and at less expense. Using an innovative approach to contract negotiation and documentation, the partnership created a flexible, rapidly scalable, technology-enabled solution.

We empowered these financial institutions to meet their current and future regulatory obligations in multiple jurisdictions – using intelligent technology guided by human expertise.

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Complexity and cost of compliant contracts

Pressure on both buy-side and sell-side financial institutions is growing as regulatory deadlines loom to meet new margin requirements for uncleared OTC derivatives.

Meanwhile, the volume and complexity of contract work to meet compliance obligations is growing. Add the internal cost-efficiency demands, and it’s clear the industry is ready to look harder at the way they handle documentation and negotiation.

Combined expertise

The collaboration between Thomson Reuters and Clifford Chance brought together deep legal acumen and financial industry experience powered by highly efficient processes and advanced technology.

Thomson Reuters applied our proprietary contract automation software, Contract Express®, and abstraction technology built specifically for OTC documentation. This platform enables teams to:

Rapidly generate compliant and consistent documentation to clients’ specifications

Easily extract key terms from existing documentation

Enable advanced analytics of the contracts

By working with Thomson Reuters we combined our deep understanding of the difficult challenges financial institutions face with a powerful, scalable delivery platform to offer clients the best of both worlds.

Paul Landless, Clifford Chance Partner
Paul Landless
Partner, Singapore Practice Area Banking & Finance, Clifford Chance

Thomson Reuters supports financial institutions with their ongoing master documentation needs by leveraging our global team of OTC derivatives documentation lawyers and professionals with direct experience working in major financial institutions.

We have developed an industry-leading approach to tackling the time-sensitive documentation needs driven by new and changing regulations for financial institutions and other heavily regulated industries.

Combining those knowledge resources with advanced technology like Contract Express, uniform processes and efficient project management, we can handle high volumes of work in tight time frames. That means our clients can expedite negotiations faster and at lower cost.

This technology-enabled service model, coupled with the derivatives-related legal knowledge and counsel from Clifford Chance, presents a powerful and valuable proposition to the financial services industry.

Currently supporting all of the major global banks, Thomson Reuters is deeply embedded in the financial services industry and well-positioned to provide OTC derivatives documentation and negotiation services across the globe with our multi-shore, follow-the-sun model. In addition, the Legal Managed Services business of Thomson Reuters is engaged with five of the world’s largest investment banks to support their OTC derivatives documentation requirements.

Clifford Chance, with a geographic footprint of 35 offices across all major financial centers, is the market leader in all areas of derivatives-related regulation – attesting to their knowledge and success in International Swaps and Derivatives Association (ISDA) related documentation initiatives.