In Practice

The Bank of England’s first ever bail-in recognition

In this article, Carl Baker considers the Bank of England’s decision to recognise the bail-in of loans to PrivatBank, a Ukrainian bank resolved in accordance with Ukraine’s resolution regime.

Is it time to review your “standard” increased costs clauses in facility documentation?

With the advent of the final stage of Basel III implementation (often referred to as Basel IV), it is time again for lenders and borrowers to consider the formulation of “boiler plate” increased costs clauses in their existing credit documentation and future transactions. In this In Practice article we highlight some of the potential interactions the latest reforms may have with commonly seen drafting both in the UK and the US and discuss some of the devices which borrowers and sponsors may use to mitigate the likelihood of being on the receiving end of an increased costs claim in the future.

Section 32 Limitation Act: an evolving yet difficult route for claimants

Crypto yield

Bitcoin, the original cryptoasset, does not pay interest or otherwise generate cashflows under the smart contract of the protocol. That has not, however, stopped the crypto community from developing products and code that do exactly that both for bitcoin and for many other types of cryptoasset. Charles Kerrigan explores the new market for crypto products with cash flows.

Cryptocurrency, proprietary injunctions, freezing orders, and trusts: the law is not cryptic

Despite the meteoric rise of cryptocurrency as an asset class, there has to date been little case law concerning it. This article looks at a recent cryptocurrency case which applies established principles relating to trusts, proprietary injunctions and worldwide freezing orders to this new asset class: Wang v Darby [2021] EWHC 3054 (Comm). This decision confirms that familiar legal principles apply equally to cryptocurrencies, although digital assets can shine a light on established areas of law. We discuss below the key issues arising from the application of established principles to novel circumstances and the way in which Wang v Darby represents a missed opportunity to address the more interesting points arising in existing case law concerning cryptocurrency.

Economic Crime (Transparency and Enforcement) Act 2022: sanctions update

There have long been calls for reform of the existing economic crime regime in the UK. Recent events in Ukraine have pushed this to the fore. As part of the UK government’s response, the Economic Crime (Transparency and Enforcement) Act 2022 (the Act) was fast-tracked through Parliament and received Royal Assent on 15 March 2022. The Act has a number of significant implications in relation to the UK sanctions regime, which we outline below.

Overview of anticipated focus areas for BBLS litigation

The government’s Bounce Back Loan Scheme (BBLS) provided small businesses with quick access to funding during the coronavirus pandemic. However, significant claims volumes are now anticipated given the combination of large numbers of applicants, standardised terms and a unique (and homogenous) application process. As collection and recovery activities begin, we consider some possible areas of focus for claims against BBLS lenders.

Don’t forget about the NSIA: potential implications for securitisations

In this In Practice article, the authors explore some practical steps to address NSIA compliance risks for securitisation transactions, including: the importance of due diligence and determining if a transaction falls within scope of the NSIA’s notification requirements; considering if a voluntary notification is necessary to mitigate call-in risk; structuring security provisions to avoid potential pitfalls; and building in contractual provisions to ensure compliance by transaction parties.

Financial covenants for fast-growth businesses: the new market norms

Financial covenants in investment grade and leveraged finance loan agreements are now well established. However, a different set of concerns are now covered by covenants being developed in relation to non-bank funding of fast-growth businesses. This In Practice article considers the terms of those fast-growth covenants.

The UK’s second batch of Sukuk and the question of Shariah compliance: exclusion clauses v due diligence

In this In Practice article, UK and international legal authority on Islamic financial law, Dr Lu’ayy Minwer Al-Rimawi, questions the excessive use of exclusion clauses in the UK’s latest Sukuk issuance to exclude liability for Shariah compliance.