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Equivalence and market access in a post-Brexit world
At the end of March 2021, the UK and EU agreed a Memorandum of Understanding which provides a framework for ongoing regulatory co-operation and dialogue on financial services in the post-Brexit environment. However, it does not significantly alter the new reality for firms doing cross-border business between the UK and EU, where UK firms face a patchwork of national regimes for market access into the EU, coupled with a limited set of equivalence determinations.
13 June 2024LMA incremental facility wording: one size fits all?
In this article the authors examine the process of establishing an incremental facility using the steps prescribed by the Loan Market Association’s (LMA) template wording and consider whether it represents common practice in the mid-market. An incremental facility (otherwise known as an “additional” or “accordion” facility) is an uncommitted facility (usually capable of being made available for acquisition, capex or general working capital purposes) which can be established by a borrower without the need to seek lender consent or amendments to the finance documentation provided that certain pre-agreed parameters are complied with.
13 June 2024Validation of the Financial Collateral Arrangements Regulations post-Brexit: legal considerations
This article considers the implications of the unusual validating provisions in the Financial Services Bill (HL Bill 162), which retrospectively validate the Financial Collateral Arrangements (No 2) Regulations 2003 (SI 2003/3226) notwithstanding any lack of power to make the Regulations, in circumstances where the Regulations give effect to EU Directive 2002/47/EC. It examines the critical questions that would have arisen pre-Brexit, and those that now arise, in relation to whether such validating legislation is lawful and argues that such validation is likely to be effective post-Brexit.
13 June 2024Settlement Finality: some UK and EU perspectives
In this article, Paula Moffatt outlines how the Settlement Finality Regulations work, examines what they mean for transactions entered into in the run up to a system participant’s insolvency, and considers some of the issues raised in the European Commission’s consultation on the Settlement Finality Directive now that the UK is a third country.
13 June 2024Out of time amendments
Dov Ohrenstein reviews how the courts approach applications to amend claims after the end of relevant limitation periods.
13 June 2024The court’s discretion in relation to the Pt 26A cram down
This article explains that a fundamental purpose of the court’s discretion whether to exercise its cram down power under the new Pt 26A process now found in the Companies Act 2006 would be to ascertain whether the dissenting class was promised a just and equitable distribution of the restructuring surplus, ie the value expected to be preserved and perhaps created by the proposed plan itself. By way of comparison, Chapter 11 of the US Bankruptcy Code, which contains the best-known cram down mechanism, requires the court to ensure a “fair and equitable” treatment of members of the dissenting class. In the US, however, the much-misunderstood Absolute Priority Rule (APR) supposedly governs this exercise. This article shows that the APR is untenable and is honoured as much in breach in US practice as in observance. Similarly, the cram down powers under the new Dutch and the proposed German restructuring regimes also envisage “exceptions” to the APR which in practice may well overwhelm the rule. Understanding why the APR cannot and should not govern the distribution of the restructuring surplus goes a considerable way to establishing that distribution of the restructuring surplus by reference to the relative contributions to the restructuring surplus by the dissenting and all junior classes provides the appropriate starting point. The article also considers the appropriate treatment of “new money” and “sweat equity”, and of classes excluded from the plan.
13 June 2024Consent under PSD2 and the GDPR: squaring the circle
The scope for misalignment between the payments and the data protection regimes in Europe and the UK gives rise to a number of challenges for banks and fintechs. This issue is particularly evident in relation to the potentially inconsistent requirements for individual consent.
13 June 2024Knowing receipt and the proprietary base
A recent High Court decision in a knowing receipt claim against a Saudi Arabian bank has considered the vexed issue of whether a beneficiary must have a continuing equitable interest enduring upon receipt of the property by the recipient to establish a knowing receipt claim. In a detailed and well-reasoned judgment Mr Justice Fancourt answered that question in the affirmative.
13 June 2024Roll-up rescue financing in Singapore: giving old debt senior priority
At its introduction into Singapore’s restructuring laws in 2017, rescue financing was heralded as value enhancing and associated with a higher probability of successful recovery for distressed companies. This article discusses the application of the rescue financing regime, including the first instance of a roll-up, and the way forward for rescue financing in Singapore.
13 June 2024The European Commission’s Digital Finance Package from the perspective of private law
This article examines the interplay between national (private) law and the legislative measures subsumed under the European Commission’s Digital Financial Package (DFP or the Package). For the reasons explained in this article, the Package may not attain, in full, its harmonisation and single market policy objectives, to the extent that it leaves the question of the legal attributes of crypto-assets to the discretion of national legislators and to the different legal traditions of the EU member states in matters of private law, rather than settling them centrally, possibly by reference to a limited-purpose European private law.
13 June 2024
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