Securities Lending Agreement Template for Netherlands

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Key Requirements PROMPT example:

Securities Lending Agreement

"Need a Securities Lending Agreement under Dutch law for a pension fund lending Dutch equities to multiple broker-dealers, with tri-party collateral management arrangements and ability to recall securities for voting purposes."

Document background
This Securities Lending Agreement template is designed for use in the Dutch jurisdiction when financial institutions need to establish a legal framework for securities lending transactions. The document comprehensively addresses all aspects required under Dutch law and EU regulations, including the Financial Supervision Act (Wft) and the EU Financial Collateral Directive as implemented in Dutch law. It is particularly relevant when parties need to document arrangements for the temporary transfer of securities against collateral, incorporating necessary provisions for regulatory compliance, risk management, and operational procedures. The agreement includes specific Dutch law considerations regarding property rights, security interests, and enforcement mechanisms, making it suitable for both domestic and cross-border transactions involving Dutch entities or securities.
Suggested Sections

1. Parties: Identification of the lender and borrower, including their legal status and registered addresses

2. Background: Context of the agreement and general intent of the parties

3. Definitions and Interpretation: Comprehensive definitions of terms used throughout the agreement and rules of interpretation

4. Loans of Securities: Core provisions governing the lending of securities, including loan mechanics and delivery procedures

5. Collateral: Requirements for posting and maintaining collateral, including types, valuation, and margin requirements

6. Payments and Transfers: Procedures for handling manufactured payments, fees, and transfer mechanisms

7. Events of Default: Definition of events of default and their consequences

8. Close-out and Set-off: Procedures for terminating transactions and calculating final settlement amounts

9. Representations and Warranties: Standard and specific representations and warranties of both parties

10. Covenants: Ongoing obligations of the parties during the term of the agreement

11. Tax Provisions: Treatment of taxes, including withholding tax obligations and gross-up provisions

12. General Provisions: Standard contractual provisions including notices, amendments, and governing law

Optional Sections

1. Agency Provisions: Required when either party acts as agent for multiple principals

2. Central Counterparty Provisions: Required when transactions are cleared through a CCP

3. Buy-in Procedures: Optional provisions for handling failed settlements through buy-in procedures

4. Custody Arrangements: Required when specific custody arrangements need to be documented

5. Electronic Trading Platform: Required when transactions will be executed through specific trading platforms

6. Third Party Rights: Optional provisions regarding rights of third parties under Dutch law

7. Additional Tax Provisions: Required for cross-border transactions or specific tax scenarios

Suggested Schedules

1. Schedule of Eligible Securities: List of securities eligible for lending under the agreement

2. Schedule of Eligible Collateral: Specifications of acceptable collateral types and haircuts

3. Agency Annex: Details of agency relationships and disclosed principals

4. Fee Schedule: Lending fees and other charges applicable to transactions

5. Form of Loan Confirmation: Standard form for confirming individual lending transactions

6. Settlement Instructions: Standard settlement and payment instructions for both parties

7. Tax Documentation: Required tax forms and certifications

8. Contact Details: List of authorized persons and contact information for notices and operations

Authors

Alex Denne

Head of Growth (Open Source Law) @ Genie AI | 3 x UCL-Certified in Contract Law & Drafting | 4+ Years Managing 1M+ Legal Documents | Serial Founder & Legal AI Author

Relevant legal definitions
Clauses
Relevant Industries

Banking

Investment Management

Asset Management

Insurance

Pension Funds

Securities Services

Financial Market Infrastructure

Brokerage

Investment Banking

Wealth Management

Relevant Teams

Legal

Securities Operations

Collateral Management

Trading

Risk Management

Compliance

Documentation

Treasury

Client Services

Portfolio Management

Middle Office

Settlements

Financial Control

Relevant Roles

Legal Counsel

Securities Operations Manager

Collateral Manager

Trading Desk Manager

Risk Manager

Compliance Officer

Securities Lending Trader

Documentation Specialist

Financial Controller

Relationship Manager

Portfolio Manager

Treasury Manager

Operations Director

Legal Documentation Officer

Industries
Dutch Civil Code (Burgerlijk Wetboek): The fundamental source of Dutch private law, particularly Book 3 (Property Law), Book 6 (General Law of Obligations), and Book 7 (Specific Contracts), which provide the legal framework for contractual relationships and property rights
Financial Supervision Act (Wet op het financieel toezicht - Wft): The main financial regulatory framework in the Netherlands, governing financial institutions and their activities, including securities lending
EU Financial Collateral Directive (2002/47/EC) as implemented in Dutch law: Provides the legal framework for financial collateral arrangements, crucial for securities lending transactions
European Market Infrastructure Regulation (EMIR): EU regulation on OTC derivatives, central counterparties, and trade repositories, which may apply to certain aspects of securities lending
Securities Giro Transfer Act (Wet giraal effectenverkeer): Regulates the transfer and custody of securities in the Netherlands through the book-entry system
Dutch Bankruptcy Act (Faillissementswet): Governs insolvency proceedings and the rights of creditors, which is crucial for understanding default scenarios in securities lending
Prevention of Money Laundering and Financing of Terrorism Act (Wwft): Anti-money laundering regulations that must be considered in financial transactions including securities lending
MiFID II / MiFIR as implemented in Dutch law: EU regulations governing financial markets and instruments, including transparency and reporting requirements applicable to securities lending
Teams

Employer, Employee, Start Date, Job Title, Department, Location, Probationary Period, Notice Period, Salary, Overtime, Vacation Pay, Statutory Holidays, Benefits, Bonus, Expenses, Working Hours, Rest Breaks,  Leaves of Absence, Confidentiality, Intellectual Property, Non-Solicitation, Non-Competition, Code of Conduct, Termination,  Severance Pay, Governing Law, Entire Agreemen

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