
From the U.S. Code Online via GPO Access
[wais.access.gpo.gov]
[Laws in effect as of January 2, 2001]
[Document not affected by Public Laws enacted between
  January 2, 2001 and January 28, 2002]
[CITE: 12USC4403]

 
                       TITLE 12--BANKS AND BANKING
 
                CHAPTER 45--PAYMENT SYSTEM RISK REDUCTION
 
        SUBCHAPTER I--BILATERAL AND CLEARING ORGANIZATION NETTING
 
Sec. 4403. Bilateral netting


(a) General rule

    Notwithstanding any other provision of law, the covered contractual 
payment obligations and the covered contractual payment entitlements 
between any 2 financial institutions shall be netted in accordance with, 
and subject to the conditions of, the terms of any applicable netting 
contract.

(b) Limitation on obligation to make payment

    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.

(c) Limitation on right to receive payment

    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.

(d) Payment of net entitlement of failed financial institution

    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.

(e) Effectiveness notwithstanding status as financial institution

    This section shall be given effect notwithstanding that a financial 
institution is a failed financial institution.

(Pub. L. 102-242, title IV, Sec. 403, Dec. 19, 1991, 105 Stat. 2374.)

                  Section Referred to in Other Sections

    This section is referred to in section 4405 of this title.
