{"identifier":"/us/usc/t12/s4403","title":12,"num":"\u00a7\u202f4403.","heading":"Bilateral netting","text":"\u00a7\u202f4403.\nBilateral netting\n(a)\nGeneral rule\nNotwithstanding any other provision of State or Federal law (other than\nsection 1821(e) of this title\nsection 5390(c) of this title\nsection 4617 of this title\nsection 1787(c) of this title\nsection 78eee(b)(2) of title 15\nsection 561(b)(2) of title 11\n(b)\nLimitation on obligation to make payment\nThe only obligation, if any, of a financial institution to make payment with respect to covered contractual payment obligations to another financial institution shall be equal to its net obligation to such other financial institution, and no such obligation shall exist if there is no net obligation.\n(c)\nLimitation on right to receive payment\nThe only right, if any, of a financial institution to receive payments with respect to covered contractual payment entitlements from another financial institution shall be equal to its net entitlement with respect to such other financial institution, and no such right shall exist if there is no net entitlement.\n(d)\nPayment of net entitlement of failed financial institution\nThe net entitlement of any failed financial institution, if any, shall be paid to the failed financial institution in accordance with, and subject to the conditions of, the applicable netting contract.\n(e)\nEffectiveness notwithstanding status as financial institution\nThis section shall be given effect notwithstanding that a financial institution is a failed financial institution.\n(f)\nEnforceability of security agreements\nThe provisions of any security agreement or arrangement or other credit enhancement related to one or more netting contracts between any 2 financial institutions shall be enforceable in accordance with their terms (except as provided in\nsection 561(b)(2) of title 11\nsection 1821(e) of this title\nsection 1787(c) of this title\nsection 78eee(b)(2) of title 15","url":"https://projectusc.org/usc/t12/s4403.html","content":[{"t":"sec","id":"/us/usc/t12/s4403","children":[{"t":"num","text":"\u00a7\u202f4403."},{"t":"heading","text":"Bilateral netting"},{"t":"subsec","id":"/us/usc/t12/s4403/a","children":[{"t":"num","text":"(a)"},{"t":"heading","text":"General rule"},{"t":"content","children":[{"t":"p","text":"Notwithstanding any other provision of State or Federal law (other than ","children":[{"t":"ref","text":"section 1821(e) of this title","href":"/us/usc/t12/s1821/e","tail":", "},{"t":"ref","text":"section 5390(c) of this title","href":"/us/usc/t12/s5390/c","tail":", "},{"t":"ref","text":"section 4617 of this title","href":"/us/usc/t12/s4617","tail":", "},{"t":"ref","text":"section 1787(c) of this title","href":"/us/usc/t12/s1787/c","tail":", or any order authorized under "},{"t":"ref","text":"section 78eee(b)(2) of title 15","href":"/us/usc/t15/s78eee/b/2","tail":"), the covered contractual payment obligations and the covered contractual payment entitlements between any 2 financial institutions shall be terminated, liquidated, accelerated, and netted in accordance with, and subject to the conditions of, the terms of any applicable netting contract (except as provided in "},{"t":"ref","text":"section 561(b)(2) of title 11","href":"/us/usc/t11/s561/b/2","tail":")."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subsec","id":"/us/usc/t12/s4403/b","children":[{"t":"num","text":"(b)"},{"t":"heading","text":"Limitation on obligation to make payment"},{"t":"content","children":[{"t":"p","text":"The only obligation, if any, of a financial institution to make payment with respect to covered contractual payment obligations to another financial institution shall be equal to its net obligation to such other financial institution, and no such obligation shall exist if there is no net obligation.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subsec","id":"/us/usc/t12/s4403/c","children":[{"t":"num","text":"(c)"},{"t":"heading","text":"Limitation on right to receive payment"},{"t":"content","children":[{"t":"p","text":"The only right, if any, of a financial institution to receive payments with respect to covered contractual payment entitlements from another financial institution shall be equal to its net entitlement with respect to such other financial institution, and no such right shall exist if there is no net entitlement.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subsec","id":"/us/usc/t12/s4403/d","children":[{"t":"num","text":"(d)"},{"t":"heading","text":"Payment of net entitlement of failed financial institution"},{"t":"content","children":[{"t":"p","text":"The net entitlement of any failed financial institution, if any, shall be paid to the failed financial institution in accordance with, and subject to the conditions of, the applicable netting contract.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subsec","id":"/us/usc/t12/s4403/e","children":[{"t":"num","text":"(e)"},{"t":"heading","text":"Effectiveness notwithstanding status as financial institution"},{"t":"content","children":[{"t":"p","text":"This section shall be given effect notwithstanding that a financial institution is a failed financial institution.","tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"subsec","id":"/us/usc/t12/s4403/f","children":[{"t":"num","text":"(f)"},{"t":"heading","text":"Enforceability of security agreements"},{"t":"content","children":[{"t":"p","text":"The provisions of any security agreement or arrangement or other credit enhancement related to one or more netting contracts between any 2 financial institutions shall be enforceable in accordance with their terms (except as provided in ","children":[{"t":"ref","text":"section 561(b)(2) of title 11","href":"/us/usc/t11/s561/b/2","tail":"), and shall not be stayed, avoided, or otherwise limited by any State or Federal law (other than "},{"t":"ref","text":"section 1821(e) of this title","href":"/us/usc/t12/s1821/e","tail":", "},{"t":"ref","text":"section 1787(c) of this title","href":"/us/usc/t12/s1787/c","tail":", and "},{"t":"ref","text":"section 78eee(b)(2) of title 15","href":"/us/usc/t15/s78eee/b/2","tail":")."}],"tail":"\n"}],"tail":"\n"}],"tail":"\n"},{"t":"text","text":"\n"},{"t":"text","text":"\n"}]}]}