Main Contract Attributes
The following are the main ACTUS Contract Attributes.
This section is intended to clarify ACTUS-specific terminology and map it to the corresponding terms used in the D-ASA implementation. ACTUS remains the normative specification throughout.
Important
In the event of any inconsistency, the ACTUS specification shall prevail.
For further details, refer to the ACTUS specification.
Principal
Debt instruments principal is the amount of capital borrowed and used as a base for calculating interest.
The D-ASA MUST define the principal \( [NT] \), expressed in the denomination asset.
The D-ASA MUST define a minimum denomination, expressed in the denomination asset.
The minimum denomination MUST be a divisor of the principal.
Premium and Discount
Debt instruments principal may be placed at premium or discount on issuance.
The D-ASA MAY define a premium or discount \( [PDIED] \) to apply to the principal on the issuance.
Tip
Let’s have a D-ASA denominated in EUR, with a principal of 1M EUR paid at maturity and a minimum denomination of 1,000 EUR. The D-ASA has a principal discount of 200 bps (2%) at the issuance. Each D-ASA unit is sold on the primary market at 980 EUR and will be redeemed for 1,000 EUR of principal at maturity.
Interests
Debt instruments interest is calculated on a fixed or variable rate on the outstanding principal.
The interest rate is the nominal yield paid by the debt instrument on the principal, usually defined per-annum (APY).
Interest Rate
Debt instruments may have variable interest rates, based on external data oracles.
The D-ASA MAY define a nominal interest rate \( [IPNR] \).
If the interest rate is variable, the D-ASA MUST define interest update dates known \( [RRF] \) or unknown \( [RR] \).
Cap and Floor
Debt instruments may define limitations to the interest rate variability, either over the whole contract lifespan or over specific periods.
Life Caps
The D-ASA MAY define a life cap \( [RRLC] \) to apply to the variable interest rate.
The D-ASA MAY define a life floor \( [RRLF] \) to apply to the variable interest rate.
Period Caps
The D-ASA MAY define a period cap \( [RRPC] \) to the variable interest rate.
The D-ASA MAY define a period floor \( [RRPF] \) to apply to the variable interest rate.
Fixing Period
Debt instruments usually schedule interest rate updates before the new rate applies (defined by the rate reset schedule).
The D-ASA MUST define a fixing period \( [RRFIX] \) that specifies a period of time before the interest payment \( [IP] \) in which the interest can be updated.
Issuance
Debt instruments start accruing interest on the issuance date.
The D-ASA MUST have an initial exchange date \( [IED] \) (issuance).
Maturity
Debt instruments may have a maturity date, on which the principal is repaid and the contract obligations expire.
Debt instruments may have a fixed or variable maturity date.
The D-ASA MAY have a maturity date \( [MD] \).
The maturity date MAY be updated in case of pre-payment options.
Prepayment Options
Debt instruments could have early repayment options to repay the principal to lenders (partially or totally) before maturity or to reduce the maturity date.
Debt instrument with defined maturity date may terminate earlier if the full principal redemption happens earlier than maturity.
The D-ASA MAY define prepayment options.
Prepayment Effects
Debt instruments could have early repayment options to repay the principal to lenders (partially or totally) before maturity or to reduce the maturity date.
Debt instrument with a defined maturity date may terminate earlier if the full principal redemption happens earlier than maturity.
An early repayment option could have different prepayment effects \( [PPEF] \):
-
It MAY repay the principal partially or totally before the maturity date;
-
It MAY reduce the maturity date.
The prepayment effect MUST be identified with one of the following enumerated IDs:
| ID | Name | ACTUS Acronym | Description |
|---|---|---|---|
0 | No Prepayment | \([N]\) | Prepayment is not allowed under the agreement |
1 | Prepayment Reduces Redemption Amount | \([A]\) | Prepayment is allowed and reduces the redemption amount for the remaining period up to maturity |
2 | Prepayment Reduces Maturity | \([M]\) | Prepayment is allowed and reduces the maturity |
Penalties
Debt instruments may have a penalty as a consequence of an early repayment option.
The D-ASA MAY define a penalty type \( [PYTP] \) for the early repayment options.
The penalty type MUST be identified with one of the following enumerated IDs:
| ID | Name | ACTUS Acronym | Description |
|---|---|---|---|
0 | No Penalty | \([N]\) | No penalty applies |
1 | Fixed Penalty | \([A]\) | A fixed amount applies as penalty |
2 | Relative Penalty | \([R]\) | A penalty relative to the notional outstanding applies |
3 | Interest Rate Differential | \([I]\) | A penalty based on the current interest rate differential relative to the notional outstanding applies |
Performance
Debt instruments performances are exposed to credit risks.
The D-ASA performance \( [PRF] \) MUST be identified with one of the following enumerated IDs:
| ID | Name | ACTUS Acronym | Description |
|---|---|---|---|
0 | Performant | \( [PF] \) | Contract is performing according to terms and conditions |
1 | Delayed | \( [DL] \) | Contractual payment obligations are delayed according to the grace period |
2 | Delinquent | \( [DQ] \) | Contractual payment obligations are delinquent according to the delinquency period |
3 | Default | \( [DF] \) | Contract defaulted on payment obligations according to delinquency period |
4 | Matured | \( [MA] \) | Contract matured |
5 | Terminated | \( [TE] \) | Contract has been terminated |
Note
The current reference implementation supports manual default-performance tracking through an RBAC-managed boolean
defaultedflag. It does not yet model the fullPRFlifecycle enum or automatic grace-period and delinquency transitions on chain.
Grace Period
Debt instruments may define a grace period as a time window after the payment due date during which payment may be retried without a penalty.
The D-ASA MAY define a grace period \( [GRP] \).
Delinquency Period
Debt instruments may define a delinquency period as a time window after the grace period. If payment happens after the delinquency period, then the counterparty is in technical default.
The D-ASA MAY define a delinquency period \( [DQP] \).
Default
Default is the ultimate failure to pay the lenders according to the payment obligations. When this happens, the creditors have the right to declare default to the debtors.
Default processes require the intervention of regulatory bodies and courts, therefore the D-ASA default status bridges the default process off-chain.
The D-ASA SHOULD enter default status if it cannot perform payments on due dates.
The D-ASA MAY disable all non-administrative methods on default status.
The D-ASA default can be called either automatically (based on program conditions) or manually (based on the decision of a trustee).
The Trustee MAY set the default status with the rbac_contract_default
method.
In the current reference implementation, rbac_contract_default(defaulted: bool)
stores a boolean defaulted flag in RBAC global state. This performance flag is
distinct from the kernel lifecycle status.
Tip
The D-ASA has no grace period and no delinquency period. A D-ASA interest payment is triggered on due date, but there is not enough liquidity to pay all the lenders. The D-ASA contract automatically enters in default immediately.
Tip
The D-ASA has a grace period and a delinquency period. A D-ASA interest payment is triggered on due date, but there is not enough liquidity to pay all the lenders. The D-ASA program starts counting the grace period and delinquency period. If the delinquency period expires, then the contract enters in default.
Tip
A D-ASA interest payment is triggered on due date, but there is not enough liquidity to pay all the lenders. The D-ASA contract relies on a Trustee to call the default.