Uganda has published rules to secure the enforceability of
close-out netting under ISDA Master Agreement, GMRA and GMSLA
contracts with financial institutions. The Financial Institutions
(Preference and Appraised Book Value) Regulations 2023 (the
"Regulations") were
published on 14 April 2023.
The new Regulations are made under the Financial Institutions
Act (the "Act") and apply to
transactions under the ISDA Master Agreement (including its credit
support documents), the GMRA and GMSLA (defined as specified
financial contracts) entered into with financial institutions.
The Regulations address the existing challenge of the
enforceability of the close-out netting provisions under the
specified financial contracts in the event of the insolvency of a
financial institution counterparty. If a financial institution is
taken over or it gets closed down by the Bank of Uganda
("BoU"), the Act states any transfer of
assets made within six months of the take over or
