Feature

Consent 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.

Knowing 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.

Effects of credit guarantee schemes on secured transactions frameworks

The importance of a modern secured transactions framework for movable assets that effectively channels credit to the SME sector has been widely recognised. However, a modern secured transactions framework may not spur market-based collateralised lending if a public credit guarantee scheme disincentivises lenders and borrowers from engaging in it. Improperly designed schemes cause many market distortions, including slower growth, profitability and sustaining zombie companies. As Japan embarks on secured transactions reform, it needs to consider the role of its credit guarantee scheme in facilitating collateralised lending. The lessons this article outlines should be instrumental in other economies.

The Digital Dispute Resolution Rules: the future of digital disputes

This article summarises some of the key points arising out of the newly published Digital Dispute Resolution Rules (Digital DR Rules). The advantages of adopting the Digital DR Rules are explored as well as considering how the rules might be incorporated into new and existing agreements.

The new 2021 ISDA Interest Rate Derivatives Definitions: the end of discretion?

The publication of the new 2021 ISDA Interest Rate Derivatives Definitions (2021 Definitions) marks the first comprehensive update of ISDA’s definitions booklet for interest rate products since the publication of the 2006 ISDA Definitions (2006 Definitions) in January 2007. It is a significant undertaking, making a very wide variety of changes to take account of, among other things, benchmark reform, the new regulatory environment for bank resolution, the introduction of collateral rules and central clearing. In addition, there will also be a new electronic ISDA user interface called MyLibrary which will be updated as changes are made to the definitions. This article analyses the changes to the cash settlement provisions.

Rank inequality: the consequences of the creation of “super priority” debts under the Corporate Insolvency and Governance Act 2020 moratorium

In this article the authors consider the consequences of the creation of “super priority” debts under the Corporate Insolvency and Governance Act 2020 (CIGA) moratorium, including the effect on secured creditors, priority as between holders of Super Priority debt and the potential impact on floating charge holders.

Commodity finance: the complete security package

COVID-19 lockdowns have disrupted commodity transactions and consequential enhanced oversight of borrowers’ businesses has uncovered fraudulent activities. Of utmost importance to any lender in a commodity financing is that the commodity exists and has not been financed by another party. Against this backdrop, in this article, the authors describe a typical security package adopted by commodity financiers under an English law commodity financing.

Dual class Premium listings: no reason for the reservations?

In the UK Listing Review it is suggested that the LSE should allow companies with dual class share (DCS) structures to list on the Premium segment. In this article, we discuss this proposal. First, we discuss the arguments that are made against DCS-listings, and we give an overview of the Swedish DCS-regulation. From there, we discuss the conditions for DCS-listing recommended in the Review. We conclude that the listing conditions suggested might not only hinder DCS-structures from being useful for some companies but would risk disabling mechanisms that could counteract several of the problems that DCS-structures may cause.

Do BNP v Trattamento and Fine Care v Natwest show the courts retreating from the principles established in First Tower Trustees?

The European Commission’s targeted consultations on European Union settlement finality and financial collateral rules

The previous occasion on which we heard from the European Commission on the directives (an interpretative communication in March 2018)³ was somewhat of a non-event. In relation to key issues of interpretation, related to the question of which law governs the proprietary aspects of collateral transactions in book-entry securities, the Commission “clarified” that all the divergent approaches taken by member states were valid under the relevant directive provisions.⁴ In fact, despite their undoubted importance to the Commission’s longstanding aim of achieving integrated capital markets in Europe, relatively little has been said about the directives at EU-level, leaving it largely up to member states to define their scope and operation. In contrast, the consultations raised a number of important and interesting policy ideas. I will discuss a few of these below, as well as consider whether there are other material issues to be addressed in an eventual amendment to the directives in order to meet their objectives. I will argue that a review of the directives should prioritise the full resolution of the conflicts of laws that cross-border systems and financial collateral transactions present.