Feature
760
Go to page
of
76
EMIR 3.0, post-trade risk reduction services and the initial margin threshold: an unintended consequence
Post trade risk reduction (PTRR) services are not new to over-the-counter (OTC) derivatives markets. Through EMIR 3.0, policymakers acknowledged their function (reducing counterparty credit risk and/or operational risk) and fostered their usage by laying down the exemption from the clearing obligation. Admittedly, however, they did not consider any impact of PTRR on margin requirements for non-centrally cleared OTC derivatives. Performing PTRR – specifically portfolio rebalancing – is set to increase the aggregate average notional amount (AANA). As the latter is calculated to determine whether the initial margin (IM) threshold is exceeded, counterparties may opt to avoid using PTRR to avoid becoming subject to the burdensome IM requirements. An outcome not in line with the intention to foster PTRR.
09 June 2025Climate risk in the commercial real estate market
In this article Matthew E Schernecke examines the effect of climate-related risk on the commercial real estate market, including the effect these risks will have on lenders’ and investors’ underwriting of loans and on the insurance coverage available in the market in respect of these risks, as well as possible implications on loan documentation.
09 June 2025Cryptoasset regulation: a comparative analysis of UK and EU regimes
This article provides a comparative analysis of the regulatory approaches to cryptoassets in the UK and the EU, focusing on the UK’s recently proposed Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025 (UK Draft Order)1 and the EU’s Regulation 2023/1114 on Markets in Crypto-Assets (MiCAR). The article examines key differences in the approach, definition and categorisation of cryptoassets, scope of regulated activities, and the territorial application of each regime, concluding with a discussion of future outlook and regulatory ‘blind spots’ in each jurisdiction.
09 June 2025Waving not drowning: Thames Water clarifies approach to out of the money creditors
In this article, the authors consider certain issues of principle decided or clarified by the Court of Appeal in the Thames Water restructuring plan: Kington S.À.R.L. & Ors v Thames Water Utilities Holdings Lt d [2025] EWCA Civ 475. Namely: the requirement to consider the treatment of “out of the money” creditors when assessing whether the allocation of benefits under a plan is fair, and the meaning of the expression “restructuring surplus” or “benefits preserved or generated by the restructuring”.
09 June 2025The LMA insolvency events of default clause: potential pitfalls and how to avoid them
This article considers the potential pitfalls in the LMA standard-form insolvency events of default clause and how the parties might seek to avoid them through targeted amendment and addition.
09 June 2025No guarantees: UK corporation and withholding tax complexities of guarantees
The UK corporation and withholding tax treatment of guarantee arrangements and related payments is complex. Once the legal nature of the various guarantee relationships is understood, the UK tax analysis can be applied. However, even then difficulties can emerge in determining the UK tax corporation and withholding effect of guarantee arrangements given the lack of case law, guidance and legislative provisions specific to guarantees.
09 June 2025Convertible bonds: a valuable funding tool in volatile markets
This article considers why, in volatile markets, the attractiveness of convertible bonds as part of the funding toolkit for both issuers and investors is enhanced. It goes on to describe some of the considerations relating to pre-emption rights and shareholder dilution that arise in the context of convertible bond transactions and various structural approaches that have been used to solve or mitigate these. Finally, it looks at how the technology used in the public convertible bond markets has an increasing role in bespoke transactions by private credit providers and financial investors.
09 June 2025Ups and downs of the EU Benchmarks Regulation
Benchmarks play a crucial role in global financial and commodity markets. They measure different economic underlyings such as interest rates, currency exchange rates, baskets of shares and commodity prices, allowing market participants to transfer risk or gain exposure by referencing a commonly understood metric. This article traces how the EU Benchmarks Regulation was developed to safeguard the financial system, but introduced unintended risks, which are now being addressed. This article also considers the consequences of amendments to the EU Benchmarks Regulation, for regulated benchmark administrators and users.
09 June 2025Schrödinger’s Deed: can an instrument be two things at once?
Following the obiter comments of HHJ Pelling KC in Macdonald Hotels Limited & Anor v Bank of Scotland PLC [2025] EWHC 32 (Comm), there may be reasons for the financial sector to be concerned about a common approach to the execution of agreements in cases where the counterparties intend the instrument to be simultaneously both a deed (for one or more parties) and a simple contract (for the other party or parties). James Hall and William Golightly of Gatehouse Chambers consider the court’s treatment of the “intention requirement” for deeds in s 1(2) of the Law of Property (Miscellaneous Provisions) Act 1989.
09 June 2025Recognition and enforcement of Ukrainian judgments against the Russian Federation in the UK
This article examines the enforcement prospects of Ukrainian court judgments against the Russian Federation in the UK, following Ukraine’s 2022 Supreme Court ruling denying Russia immunity in tort claims related to its military aggression. It analyses key procedural obstacles under the Hague Convention 2019, the UK’s State Immunity Act 1978 and common law, including jurisdiction, service of process and public policy defences, highlighting the tension between sovereign immunity and international accountability.
06 May 2025
Go to page
of
76
