The FSB's Key Attributes call for no right to terminate solely because a firm has entered resolution, as long as the substantive obligations under the contract, such as payments, continue to be performed. Where termination rights can still be exercised, the Key Attributes call for the resolution authority to have the power to stay them for a short period, for example not exceeding 2 business days1.
The stay covers termination rights that arise from entry into resolution and similar grounds. It does not stop termination rights that arise from events of default unrelated to resolution, such as failure to make a payment or return collateral. The length of the stay differs by country. The US Federal Reserve Board's rule requires covered large banking groups to include clauses in their contracts that limit termination rights2.