Initiate and Accept

The Initiate and Accept pattern demonstrates how to start a bilateral workflow. One party initiates by creating a proposal or an invite contract. This gives another party the chance to accept, reject or renegotiate.

Motivation

It takes two to tango, but one party has to initiate. There is no difference in business world. The contractual relationship between two businesses often starts with an invite, a business proposal, a bid offering, etc.

Invite
When a market operator wants to set up a market, they need to go through an on-boarding process, in which they invite participants to sign master service agreements and fulfill different roles in the market. Receiving participants need to evaluate the rights and responsibilities of each role and respond accordingly.
Propose
When issuing an asset, an issuer is making a business proposal to potential buyers. The proposal lays out what is expected from buyers, and what they can expect from the issuer. Buyers need to evaluate all aspects of the offering, e.g. price, return, and tax implications, before making a decision.

The Initiate and Accept pattern demonstrates how to write a DAML program to model the initiation of an inter-company contractual relationship. DAML modelers often have to follow this pattern to ensure no participants are forced into an obligation.

Implementation

The Initiate and Accept pattern in general involves 2 contracts:

Initiate contract

The Initiate contract can be created from a role contract or any other point in the workflow. In this example, initiate contract is the proposal contract CoinIssueProposal the issuer created from the master contract CoinMaster.

template CoinMaster
  with
    issuer: Party
  where
    signatory issuer

    controller issuer can
      nonconsuming Invite : ContractId CoinIssueProposal
        with owner: Party
        do create CoinIssueProposal
             with coinAgreement = CoinIssueAgreement with issuer; owner

The CoinIssueProposal contract has Issuer as the signatory, and Owner as the controller to the Accept choice. In its complete form, the CoinIssueProposal contract should define all choices available to the owner, i.e. Accept, Reject or Counter (e.g. re-negotiate terms).

template CoinIssueProposal
  with
    coinAgreement: CoinIssueAgreement
  where
    signatory coinAgreement.issuer

    controller coinAgreement.owner can
      AcceptCoinProposal
        : ContractId CoinIssueAgreement
        do create coinAgreement
Result contract

Once the owner exercises the AcceptCoinProposal choice on the initiate contract to express their consent, it returns a result contract representing the agreement between the two parties. In this example, the result contract is of type CoinIssueAgreement. Note, it has both issuer and owner as the signatories, implying they both need to consent to the creation of this contract. Both parties could be controller(s) on the result contract, depending on the business case.

template CoinIssueAgreement
  with
    issuer: Party
    owner: Party
  where
    signatory issuer, owner

    controller issuer can
      nonconsuming Issue : ContractId Coin
        with amount: Decimal
        do create Coin with issuer; owner; amount; delegates = []
../../_images/initiateaccept.png

Initiate and Accept pattern diagram

Trade-offs

Initiate and Accept can be quite verbose if signatures from more than two parties are required to progress the workflow.