Feature

Petrofac: the unanswered question of fair allocation

The Court of Appeal’s recent decision in Saipem S.P.A and Ors v Petrofac Limited & Ors [2025] EWCA Civ 821, overturning Marcus Smith J’s decision in the High Court ([2025] EWHC 1250 (Ch)) (Petrofac), has generated substantial comment. This is the third Court of Appeal decision on Pt 26A of the Companies Act 2006, the other two being Kington S.A.R.L. & Another v Thames Water Utilities Holdings & Ors ([2025] EWCA Civ 475) (Thames Water) and Strategic Value Capital Solutions Master Fund LP v AGPS Bondco PLC ([2024] EWCA Civ 24) (Adler). The main issues addressed in Petrofac were whether the position of creditors who were “out of the money”¹ in the relevant alternative (insolvency, as in all three cases) could be disregarded when considering whether the benefits generated or preserved by the restructuring had been allocated fairly, and the proper approach to evaluating what constitutes a “market return” for new money advanced under a restructuring plan.

The evolution of the ESFS in a time of armed conflict: legal foundations, policy options and practical considerations

The EU remains, by design and aspiration, a project of peace. Yet a deteriorating global security environment requires policymakers, supervisors and private-sector actors to contemplate an unprecedented question: how would the European System of Financial Supervision function (ESFS) – and how might it have to evolve – were the EU or NATO drawn into armed conflict? This article analyses, from a legal and strategic perspective, the extraordinary measures that could be deployed to safeguard the Single Market for financial services in wartime. After setting out the relevant treaty bases, the discussion examines: (i) emergency legislation and supervisory override of business-as-usual (SOBAU); (ii) likely pathways towards further institutional centralisation; (iii) the special role of emergency money – ranging from historic Notgeld  to a future Digital Euro with offline functionality; and (iv) the preparedness agenda for financial institutions. The contribution concludes that pre-emptive legal clarity, coupled with rigorous private-sector contingency planning, is indispensable if Europe’s financial architecture is to remain resilient under the most extreme of circumstances.

The role of “administrative parties” in distressed and default scenarios

In this article, we consider the roles and duties of what are often described as “administrative parties” (namely, facility agents, bond/note trustees and security agents/trustees) in various distressed and default scenarios (including liability management exercises, enforcements and comprehensive financial restructurings). We focus on the intersection between the roles of such agents and trustees in the transaction, their contractual obligations and any applicable statutory, common law or equitable duties.

The Hamblin cases: a solution to a puzzle?

The Hamblin  cases illustrate the potential to bring authorised push payment fraud claims despite the decision of the Supreme Court in Philipp. However, the cases should be treated with caution: potentially fundamental issues lie just beneath the surface. This article considers both the problem that the claimants were attempting to solve, and the coherence of the solution adopted.

Balancing acts: prudential regulation of money issuers

This article explores the regulatory capital requirements that apply to the issuers of two types of money: bank deposits and stablecoins. Where relevant it also considers issuers of e-money. Stablecoins are an increasingly popular form of digital money. They are bearer instruments that run on blockchains. As explained in the second half of the article, they are quite different to existing forms of money.

Novation of loan facilities: impact on guarantees and borrower declarations

In this article Lisa Lacob considers arguments run on the basis that novation of loan facilities extinguish the original contract and replace it with a new one. Much will depend on the precise terms of the loan facilities and associated guarantees, but prudent lenders will want to make sure that certain terms cover the possibility of novation.

Digital Assets and (Electronic) Trade Documents in Private International Law

Amy Held introduces the Law Commission’s law reform project ‘Digital Assets and (Electronic) Trade Documents in Private International Law’ following the publication of the Consultation Paper and third FAQ document on 5 June 2025.

Fantastic cryptos and where (not) to find them: prudential rules for the digital age

Since their main-stream inception with Bitcoin in 2009, cryptocurrencies have evolved dramatically, emerging as a transformative asset class distinct from traditional flat currencies. Cryptocurrencies and distributed ledger technology have introduced significant efficiencies, such as greater transactional transparency, faster settlement processes and increased financial accessibility. As a result, the market has grown exponentially, achieving a market capitalisation f approximately US$3.93trn (as at 22 July 2025), signifying deepening integration within the global financial system. 

Notwithstanding the successes, a string of scandals, including the collapse of crypto ventures such as Celsius, BlockFi and Terra and the implosion of FTX, has brought renewed focus on the volatility and liquidity of such instruments and their systemic impact. In response to the rapid evolution and integration of cryptocurrencies, the Basel Committee developed a detailed prudential framework designed to manage the associated risks effectively. This article examines these developments and their implications for banks globally, and addresses whether the rigid classification into Group 1 and Group 2 cryptoassets strikes an appropriate balance between prudential conservatism and enabling banks to engage competitively within this evolving market. 

Show me the money: value leakage in European high-yield bonds

In this article, James McDonald, Kenneth Ryan and Michael Chern provide an overview of how high-yield bond covenants regulate the movement of a company’s cash and assets beyond the reach of creditors, or “value leakage”, and recent trends in these covenants, with a focus on the European high-yield market.

Mind the gap: UK stablecoin rules create uncertainty

The UK government’s recent decision not to proceed at this time with extending the payment services regulatory framework to fiat-referencing stablecoins marks a significant policy reversal. The previous government’s phased approach offered time and flexibility to address difficult boundary questions and ensure coherent treatment aligned with economic function. By collapsing regulation of cryptoassets into a single legislative phase for both fiat-referencing stablecoins and other cryptoassets, the current Draft Order risks a lack of functional differentiation between payment instruments and investment assets, as well as territorial ambiguity. This article explores the UK’s shift in approach, highlighting points of interpretive uncertainty and divergence from developments in the US.