Jones Day

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.