Netting Contract Law and Legal Definition
According to 12 USCS § 4402 (14) (A), in general, the term netting contract--
“(i) means a contract or agreement between 2 or more financial institutions, clearing organizations, or members that provides for netting present or future payment obligations or payment entitlements (including liquidation or close out values relating to such obligations or entitlements) among the parties to the agreement; and
(ii) includes the rules of a clearing organization.
(B) Invalid contracts not included. The term "netting contract" does not include any contract or agreement that is invalid under or precluded by Federal law.”