ISDA to publish protocol for Lyondell credit derivative trades

By Jennifer Chiou

New York, Jan. 7 - The International Swaps and Derivatives Association, Inc. announced that it will launch a credit default swap auction protocol to facilitate the settlement of credit derivatives trades, other than loan-only CDS transactions, referencing three entities in the LyondellBasell group: Lyondell Chemical Co., Equistar Chemicals, LP and Millennium America Inc.

In addition, LCDX dealers are expected to vote on whether to hold an auction for loan-only CDS transactions referencing Lyondell Chemical, a news release stated.

If those firms vote to hold an auction, ISDA will publish auction terms for this auction, similar to the documentation for the recent Tribune Co. loan-only CDS auction, the release added.

LyondellBasell Industries AF SCA announced on Tuesday that in order to facilitate a restructuring of its debts, its U.S. operations and one of its European holding companies, Basell Germany Holdings GmbH, have voluntarily filed for Chapter 11 bankruptcy.

LyondellBasell is a Rotterdam, Netherlands-based polymer, petrochemicals and fuels company.

ISDA is based in New York and represents participants in the privately negotiated derivatives industry.

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