The Bilateral Netting of Qualified Financial Contracts Act, 2020

The Bilateral Netting of Qualified Financial Contracts Act, 2020 is a significant piece of legislation that provides a legal framework for the netting of qualified financial contracts. The act aims to reduce counterparty risk in financial markets and provides greater certainty and predictability to market participants. The act defines the legal framework for netting of qualified financial contracts and specifies the rules governing the enforceability of such netting agreements. The act covers a wide range of financial contracts such as derivatives, repos, and securities lending agreements. The act also establishes a central counterparty for the purpose of netting financial contracts, and provides for the recognition and enforcement of netting agreements by courts in India. The act is expected to promote financial stability and facilitate the development of financial markets in India.