Pari passu

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Pari passu is a Latin phrase that literally means "with equal step"^[1]. It is sometimes translated as "hand-in-hand," "with equal force," or "moving together"^{[citation needed]}, and by extension, "fairly", "without partiality".

In law, this term is commonly used as legal jargon. Black's Law Dictionary (8^th ed. 2004) defines pari passu as "proportionally; at an equal pace; without preference".

In finance, this term refers to two or more loans, bonds or series of preferred stock having equal rights of payment or level of seniority.^[2] For asset management firms, the term denotes an equal allotment of trades to strategically identical funds or managed accounts.

This term is also often used in bankruptcy proceedings where creditors are said to be paid pari passu, or each creditor is paid pro rata in accordance with the amount of his claim. Here its meaning is 'equally and without preference'.

References

^ Belinsky, Natalya. "Glossary of Colloquialisms (Starting with "P")". TranslationDirectory.com. Retrieved on 2008-02-13.
^ Investopedia.com

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