272 NEWSLETTER 2021 noted that the use of confirmations is not mandatory under the General Agreement. According to section §2.2 of the General Agreement, if there is an inconsistency between the General Agreement and the Election Sheet, the Election Sheet supersedes the General Agreement. In the event there is a conflict between the Individual Contract terms (whether recorded in a confirmation or not) and the General Agreement (including the Election Sheet) the terms of the Individual Contract take priority in the interpretation. Conclusion of Individual Contracts The General Agreement is, on its own, a framework agreement. Therefore, until the parties to the General Agreement conclude Individual Contracts based on the General Agreement, it will not generate performance obligations for the parties.5 Section §3 of the General Agreement defines the procedure through which the parties may conclude Individual Contracts. In line with the General Agreement’s user-friendly attitude, it expressly states that the Individual Contracts do not have to be recorded in writing unless otherwise agreed between the parties. In this case, either party may send a written confirmation to the other party regarding the agreement so reached. The party receiving the confirmation should promptly review it and inform the other party if the content of the confirmation differs from what was agreed between the parties. Single Agreement Concept The most prominent characteristic of the General Agreement is the single agreement concept. Under section §1.1 of the General Agreement, “[a]ll Individual Contracts and this General Agreement shall form a single agreement between the Parties”. Thus, whenever the term “Agreement” is used in the General Agreement, it refers to all of the Individual Contracts executed pursuant to the General Agreement, as well as to the terms of the General Agreement itself.Similar to the ISDA Master Agreement, this single agreement concept is mainly intended to link the Individual Contracts with each other and with the General Agreement so that, in the event of bankruptcy of one of the 5 Ayrancı, p. 133.
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