Financial Collateral Arrangements and Party Autonomy

Abstract

This paper deals with the extent to which parties to financial collateral arrangements enjoy the freedom to choose the various aspects of these arrangements. I will be tackling the question of whether the parties have the freedom to choose the applicable law but will also be going beyond this to examine the various other aspects of collateral arrangements. I will argue that, at least as a matter of Dutch law, this freedom extends very widely, perhaps more widely than most market participants realize. The central questions then that are posed in this paper will be, to what extent do parties have the freedom to shape their arrangements and to what extent do the provisions of mandatory law limit such freedom?