3.3.3 Foreign Exchange Transactions

What is a foreign exchange transaction (FX Transaction)?

An FX Transaction is an agreement between two parties providing for the exchange or delivery of an amount of one currency for an amount of another currency.

There are three primary documents for documenting spot or forward FX Transaction being:

  • ISDA Master Agreement (the relevant definitions being the 1998 FX and Currency Option Definitions which can be found at www.isda.org (see Bookstore/Publications));
  • AFMA's Master Agreement for Foreign Currency Transactions (a copy of which is located 2.5 "AFMA short form FX" which includes commentary on the agreement); and
  • International Foreign Exchange Master Agreement 2005 version.

The International Foreign Exchange Master Agreement is rarely used in Australia. 

Last Update Date 29 Jun 2011