> ## Documentation Index
> Fetch the complete documentation index at: https://tonic-ai.mintlify.site/llms.txt
> Use this file to discover all available pages before exploring further.

# CDM Compliance

> FINOS Common Domain Model compliance in CreditNexus

## CDM Overview

CreditNexus is fully compliant with the **FINOS Common Domain Model (CDM)**, ensuring interoperability with other financial systems and adherence to industry standards.

**Code Reference**: `app/models/cdm.py`, `app/models/cdm_events.py`, `.cursor/rules/cdm-compliance.mdc`

***

## CDM Models

All financial data is represented using CDM models:

### CreditAgreement

Represents credit facility agreements with parties, facilities, and terms.

**Code Reference**: `app/models/cdm.py` (CreditAgreement model)

### Party

Represents counterparties (borrowers, lenders, guarantors).

**Code Reference**: `app/models/cdm.py` (Party model)

### LoanFacility

Represents individual loan facilities within a credit agreement.

**Code Reference**: `app/models/cdm.py` (LoanFacility model)

### TradeExecution

Represents trade execution events with CDM-compliant structure.

**Code Reference**: `app/models/cdm_events.py` (generate\_cdm\_trade\_execution)

### PolicyEvaluation

Represents policy decision events with evaluation trace.

**Code Reference**: `app/models/cdm_events.py` (generate\_cdm\_policy\_evaluation)

***

## Policy Validation

Policy validation is embedded at the point of data creation using Pydantic model validators:

```python theme={null}
@model_validator(mode='after')
def validate_policy_compliance(self) -> 'CreditAgreement':
    """CDM-compliant validation at point of creation."""
    # Policy checks here
    return self
```

**Code Reference**: `app/models/cdm.py` (model validators), `.cursor/rules/cdm-compliance.mdc`

***

## CDM Events

All state changes and policy decisions are stored as CDM events:

### TradeExecution Events

Record trade executions with CDM-compliant structure:

```python theme={null}
trade_event = generate_cdm_trade_execution(
    trade_id="TRADE_001",
    borrower="ACME Corp",
    amount=1000000.00,
    rate=5.25
)
```

**Code Reference**: `app/models/cdm_events.py` (generate\_cdm\_trade\_execution)

### PolicyEvaluation Events

Record policy decisions with evaluation trace:

```python theme={null}
policy_event = generate_cdm_policy_evaluation(
    transaction_id="DEAL_2024_001",
    transaction_type="facility_creation",
    decision="BLOCK",  # or "ALLOW", "FLAG"
    rule_applied="block_sanctioned_parties",
    related_event_identifiers=[],
    evaluation_trace=[...]
)
```

**Code Reference**: `app/models/cdm_events.py` (generate\_cdm\_policy\_evaluation)

### Observation Events

Record observations and verifications:

* Loan default observations
* Recovery action observations
* Verification results

**Code Reference**: `app/models/cdm_events.py` (generate\_cdm\_observation, generate\_cdm\_loan\_default)

***

## Event Structure

CDM events include required fields:

* **`eventType`**: Type of event (e.g., "TradeExecution", "PolicyEvaluation", "Observation")
* **`eventDate`**: ISO 8601 timestamp
* **`meta.globalKey`**: Unique identifier with issuer and assignedIdentifier
* **`relatedEventIdentifier`**: Links to related events

**Code Reference**: `app/models/cdm_events.py` (all event generators)

***

## CDM Compliance Principles

### 1. Validation at Creation

All CDM models validate policy compliance at the point of creation:

```python theme={null}
class CreditAgreement(BaseModel):
    # ... fields ...
    
    @model_validator(mode='after')
    def validate_policy_compliance(self) -> 'CreditAgreement':
        """CDM-compliant validation at point of creation."""
        # Check sanctioned parties
        if self.parties:
            for party in self.parties:
                if party.lei and self._is_sanctioned(party.lei):
                    raise ValueError(f"Party {party.name} is sanctioned")
        return self
```

**Code Reference**: `.cursor/rules/cdm-compliance.mdc`

### 2. Event Generation

All policy decisions generate CDM events:

```python theme={null}
# Policy evaluation
policy_result = policy_service.evaluate_facility_creation(agreement)

# Create CDM event
policy_event = generate_cdm_policy_evaluation(
    transaction_id=agreement.deal_id,
    transaction_type="facility_creation",
    decision=policy_result.decision,
    rule_applied=policy_result.rule_applied,
    related_event_identifiers=[],
    evaluation_trace=policy_result.trace
)
```

**Code Reference**: `app/services/policy_service.py`, `app/models/cdm_events.py`

### 3. State Machine Pattern

All state transitions use CDM-compliant state machine pattern:

* States are CDM-compliant
* Transitions generate CDM events
* State history is maintained

**Code Reference**: `.cursor/rules/cdm-compliance.mdc`

***

## CDM Event Storage

CDM events are stored in the database as JSONB:

```python theme={null}
class PolicyDecision(Base):
    __tablename__ = "policy_decisions"
    
    cdm_events: Mapped[dict] = mapped_column(JSONB)  # Store full CDM events
```

**Code Reference**: `app/db/models.py` (PolicyDecision, LoanDefault, RecoveryAction models)

***

## Compliance Checklist

* ✅ CDM model definitions (CreditAgreement, Party, LoanFacility)
* ✅ CDM event generation (TradeExecution, PolicyEvaluation, Observation)
* ✅ Policy validation at creation point
* ✅ Event storage in database (JSONB)
* ✅ ISO 8601 date formatting
* ✅ Global key generation
* ✅ Related event linking

***

## Additional Resources

* [FINOS CDM Documentation](https://www.finos.org/common-domain-model)
* [CDM Compliance Rules](../../.cursor/rules/cdm-compliance.mdc)
* [Policy Compliance](/compliance/policy-compliance)
* [CDM Events Implementation](../../app/models/cdm_events.py)

***

**Last Updated**: 2026-01-14\
**Standard**: FINOS CDM\
**Code Reference**: `app/models/cdm.py`, `app/models/cdm_events.py`, `.cursor/rules/cdm-compliance.mdc`