The new agreement, which operates under English law, reflects significant market developments including the discontinuation of LIBOR and post-Brexit adjustments that account for EU law no longer applying in the UK.

The 2025 framework introduces several significant structural changes to improve efficiency and clarity. The agreement now features a streamlined offer and acceptance mechanism for requesting and making trade loans, reducing administrative burden. Additional provisions and commercial terms have been incorporated directly into the Trade Loan Request, minimising the need for optional wording in the main agreement. 

A notable innovation is the introduction of the “Booking Office” concept, which allows parties to designate specific offices or branches for particular trade loans, offering greater flexibility for international institutions. The updated agreement contains clearly marked sections in square brackets that parties must complete or modify to finalise the document. 

Perhaps most significantly, the 2025 agreement introduces new sustainability loan provisions, reflecting the growing importance of environmental, social and governance considerations in international finance.

Geoffrey Wynne, who heads Sullivan’s Trade & Export Finance Group and led the advisory team, described the agreement as “a cornerstone agreement for bank-to-bank trade loans around the world” that creates “a more robust and future-proof trade finance framework”.

BAFT emphasised that standardising documentation is “foundational” to its purpose. Craig Weeks, Senior Vice President at BAFT, noted the organisation’s focus on defining best market practices to facilitate efficient delivery of trade finance products.

The 2025 agreement does not replace the previous 2014 version, which remains available for use.

Wynne discussed the updated agreement at the BAFT Europe Bank to Bank Forum in Amsterdam yesterday.