Before the first draft of a trading agreement ever hits your inbox, counterparties will request a suite of onboarding materials to satisfy regulatory and internal compliance checks. Preparing these materials in advance can help avoid delays, reduce back-and-forth, and demonstrate operational maturity.

It’s important to note that onboarding requirements can vary significantly from one counterparty to another. Differences in jurisdiction, internal risk policies, and regulatory interpretations mean no two counterparties approach onboarding exactly the same way. That’s why having your core documents organized and ready internally is critical, it puts you in a strong position to move quickly and respond efficiently.

Here’s what to expect and how to get prepared, before beginning negotiations with each new counterparty.

 

1. Entity and Governance Documents: Proving You Exist

Counterparties start by confirming who they’re dealing with. This means providing clear documentation that verifies your entity’s formation, structure, and legal authority to transact.

 

What you’ll need to have ready:

• Certificate of Formation (or equivalent formation docs)
• Organizational chart showing ownership and control
• Limited Partnership Agreement (or equivalent operating agreement)
• Investment Manager Agreement
• Offering Document (e.g. Private Placement Memorandum)
• List of authorized signatories or Incumbency Certificate
• Board or management resolutions approving counterparty and entering into trading activity (if required)

Having these materials updated and centralized can significantly accelerate the counterparty review process.

 

2. KYC and Tax Documentation: Clearing Regulatory Hurdles

Know Your Customer (KYC) checks are required by global anti-money laundering rules. Counterparties will also need tax documents to determine your withholding status and reporting obligations.

 

What to expect:

• Legal Entity Identifier (LEI)
• W-8BEN-E, W-8IMY, W-8ECI or W-9 tax form
• Entity address verification
• Identification for beneficial owners and key control persons
• Ultimate Beneficial Ownership (UBO) disclosures

Being organized internally—especially around ownership details and global tax status—can help minimize back-and-forth with each new counterparty.

 

3. AML & Sanctions Policy Attestations: Meeting Global Compliance Standards

Many counterparties will request a copy of your firm’s AML and sanctions policies—or at least an attestation that they exist and are enforced. They want to ensure you have appropriate controls in place to prevent financial crime.

You may need to provide:

• A summary of your internal AML policy (or the full version)
• Confirmation of Politically Exposed Person (PEP) screening procedures
• Evidence of sanctions screening processes
• Regulator registration details (if applicable)

Even if you rely on a third-party administrator or outsourced compliance provider, counterparties will still expect documentation that reflects your firm’s internal controls.

 

4. Dodd-Frank Onboarding Protocols: Preparing for Derivatives Conversations

If there’s even a possibility you’ll engage in swaps or other derivatives, you’ll be expected to preemptively adhere to Dodd-Frank protocols. Many dealers require this at the onboarding stage, whether or not trading begins immediately.

Be ready to submit:

• ISDA August 2012 and March 2013 Dodd Frank Protocol adherence letters & supplementary questionnaires
• ISDA 2021 SBS or SBS Top-Up Protocol adherence letter
• ISDA Regulatory Representations form
• End-user exception election documentation (if applicable)
• LEI (used for CFTC reporting)
• CFTC swap dealer status or exemption designation

Clarifying your regulatory status early prevents delays once negotiations begin.

Leveraging Technology to Stay Ready

Using a third-party technology platform can help streamline the onboarding process across counterparties and relationships. Centralized systems give teams one place to store, update, and share key documents—reducing duplication and improving visibility across stakeholders.

With a solution like Quadrangle’s QDS platform, firms can:

• Maintain a dynamic repository of onboarding materials
• Track document status, renewal and expiration dates
• Quickly generate customized packets based on counterparty-specific requirements
• Ensure version control across internal teams and external parties
• Easy access by authorized end-users at counterparties

Technology can bridge the gap between legal, compliance, and operations, keeping everyone aligned, creating efficiency and reducing manual effort.

Streamlining the Prep Work

Since each counterparty may ask for slightly different documentation—or request it in different formats—it’s wise to standardize what you can internally. With QDS’s KYC Exchange, you can assign document owners, keep templates updated, and create a shared onboarding folder your team can draw from for every new relationship.

At Quadrangle, we help investment managers organize, track and maintain onboarding materials, manage counterparty variations, and stay ahead of documentation requirements, renewals and expiration dates—so you can focus on relationship-building, not paperwork.

If you’re preparing to onboard new counterparties, reach out—we can help your team get ahead of the process.

 

Stay tuned for our upcoming blog, where we’ll cover the latest updates to FinCEN’s KYC/AML regulations and what they mean for investment managers onboarding new counterparties.