Parliament passes Bilateral Netting of Qualified Financial Contracts Bill
Parliament on Wednesday passed a Bill that seeks to provide a legal framework for bilateral netting of qualified financial contracts. Lok Sabha had passed the bill on Sunday. The legislation allows for enforcement of netting for qualified financial contracts.
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Parliament on Wednesday passed a bill that seeks to provide a legal framework for bilateral netting of qualified financial contracts. Lok Sabha had passed the bill on Sunday.
The legislation allows for the enforcement of netting for qualified financial contracts. Finance Minister Nirmala Sitharaman termed the Bill as critical for financial stability in the country and said it brings in a firm legal basis for bilateral netting for two counterparties.
Sitharaman said: "It is just the bilateral contracts which do not have any firm legal basis. The value of bilateral derivative contracts is estimated by the Clearing Corporation of India to be Rs. 56,33,257 crore as of March 2018." Bilateral contracts constitute 40 percent of total financial contracts while multilateral contracts constitute 60 percent, she added.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)
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- Nirmala Sitharaman
- Lok Sabha