Surveys conducted at the time of IFXCO`s inception showed that, although there have been some significant changes in the forex market since 1997 and although many new contracts have been concluded with an updated ISDA framework contract (from 2002), many participants have still used the IFEMA (and FEOMA) agreements. This is usually explained either by the fact that they had been executed and not replaced some time before, or because the counterparties (including, at that time, many non-traders like hedge funds) only intended to trade foreign exchange and/or monetary options transactions, preferring iFEMA and FEOMA, as these were simpler deals. The International Exchange Agreement (IFEMA) was published in 1997. It was originally developed by the British Bankers` Association and the Foreign Exchange Committee (an advisory committee sponsored by but independently of the Federal Reserve Bank of New York). IFEMA was published in 1997 by these two groups in collaboration with the Canadian Committee on Foreign Exchange Exchange and the Community Committee on Market Practices in Data Exchange. Market participants have recognized the need to address the problem of a broken counterparty on foreign exchange transactions. Since transactions are carried out on different depreciation dates, the challenge was to apply what traders do on a daily basis in the management of their portfolios, namely to give a current value to a flow of forward payment obligations, even if these payments will be due in the future, so that there is a market valuation due by or by either party. The 1998 definitions of currencies and monetary options are published jointly by ISDA, EMTA and the Foreign Exchange Committee and are intended to confirm individual transactions governed by (i) the 1992 isda framework contracts; (ii) the International Foreign Exchange and Options Master Agreement (FEOMA), the International Foreign Exchange Master Agreement (“IFEMA”) and the International Currency Options Market Master Agreement (ICOM), respectively published by the Foreign Exchange Committee in collaboration with the British Bankers Association, the Canadian Committee for Data Exchange and the Committee on International Market Market Practices; and (iii) other similar agreements. The issue of framework agreements involving parties trading in more than one jurisdiction could therefore be described as a multi-branch issue.

Many participants, especially banks, conduct foreign exchange transactions from their headquarters and branches around the world. In order to meet basel Capital Accord`s standards for the recognition of closed-out set-off, a bank is required to obtain legal advice that the bankrupt framework contract is applicable under the law of the jurisdiction whose law governs the contract, the jurisdictions in which the parties have its registered office, and the jurisdictions in which the competing branches are located. For banks established in the United States, it is likely that a U.S. court would recognize, for an agreement governed by U.S. law, a provision that impedes ongoing transactions of the head office and branches; This is a question that must be asked of the lawyer in any jurisdiction covered by a multi-step agreement. Many jurisdictions recognize netting at the headquarters level. In other jurisdictions, the law of that jurisdiction may require the non-defaulting party to pay the defaulting party`s branch for transactions involving the branch to which the branch owed money. Any FX transaction or currency option transaction that is pending or entered into between the parties or after the date of this Agreement is expressly subject to this Agreement, regardless of references in a confirmation or other framework agreements (e.g. B FEOMA, IFEMA, ICOM, all the general conditions indicated]. . . .