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Clifford Chance

Clifford Chance


GMRAs and determining 'Fair Market Value': Broad discretion of the non-defaulting party re-affirmed by Court of Appeal

14 May 2018

The English Court of Appeal has ruled on the construction of the close-out default valuation provisions under a repo agreement. The Court's judgment reaffirms that, in reaching a determination of "fair market value", the non-Defaulting party has considerable discretion when making a determination in its "reasonable opinion" as long as it acts rationally and not arbitrarily or perversely.

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