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Scotland’s new statutory pledge: taking security over shares
Before the new regime was introduced, to take fixed security over shares in a Scottish company the shares needed to be transferred to the security holder (or its nominee). This causes a myriad of practical problems. The Moveable Transactions (Scotland) Act 2023, which came into force on 1 April 2025, allows (with a little help from the UK government) a new form of fixed security, the statutory pledge, to be taken over shares in Scottish companies that will side-step the bulk of these issues. This article explores the problems previously encountered in taking security over shares in Scottish companies and the advantages (and a few shortcomings) of the new statutory pledge. The old fixed security by transfer remains competent.
04 April 2025In sickness and in health: a review of transfer provisions in European leveraged loan agreements
Private equity sponsors, with good reason, are very aware of the importance of their portfolio businesses being able to control the types of lenders who hold their debt. They are keen to manage lender relationships throughout their investment period. Equally, it is important for lenders not to be unduly restricted in their ability to trade out of their loans should they need to. This obvious tension in the relationship between the borrower and its lenders has resulted in ever more detailed and restrictive transfer provisions in European leveraged loan agreements. This article considers the details of those provisions.
04 April 2025Understanding co-operation agreements: current boom, fundamental issues and latest trends
In recent years, there has been an increase in the use of Co-operation Agreements in US and European restructurings as a reaction to lenders being caught on the wrong side of a liability management exercise. This article highlights fundamental issues and trends with respect to Co-operation Agreements, discussing practical considerations, recent case developments and the potential further evolution, and use, of Co-operation Agreements in the future.
04 April 2025Derivatives for private capital managers: hot topics and predicted trends for 2025
This article explores the hot topics and predicted trends for 2025. It is not focused on one particular strategy or sector and will be of interest to private capital managers using English law derivatives documents and/or those which are subject, directly or indirectly, to EU regulation (which includes US managers active in the EU).
02 March 2025Waiver and estoppel arguments against debt enforcement
This article considers arguments of waiver, estoppel and variation that borrowers may raise to resist debt enforcement action, and their interaction with so-called “no oral modification” provisions typically found in finance documentation. It also considers some practical implications of the principles in the banking and finance context.
02 March 2025“Red flags” and ostensible authority: reflections on Republic of Mozambique v Credit Suisse & Ors
The question of when an agent has ostensible authority to bind their principal has been the subject of several important decisions in recent years. That question arose again in Republic of Mozambique v Credit Suisse International & Ors [2024] EWHC 1957 (Comm) (Mozambique) in relation to whether the Mozambican finance minister had authority to enter into sovereign guarantees on behalf of the Republic of Mozambique (the Republic) with various lending banks. This article analyses some of the issues that arose in Mozambique in relation to ostensible authority and considers the “red flags” of financial crime relied upon by the Republic as putting the banks on inquiry that the finance minister did not have authority.
02 March 2025Protecting shareholders against transactions with an improper purpose
This article discusses the recent case of Tianrui (International) Holding Company Ltd v China Shanshui Cement Group Ltd [2024] UKPC 36, [2024] 3 WLR 986 in which the Privy Council explained the personal right of shareholders to challenge share issues undertaken for an improper purpose. The right derives from the contractual relationship between the shareholders and the company, and the fiduciary duties thereby imposed on the directors. The resulting claim has implications for banks that may be involved in a company’s activities, for example as lenders or corporate advisers.
02 March 2025Changing of the (safe)guard: the FCA’s proposals for payments and e-money firms
Payments and e-money firms are subject to a safeguarding regime designed to protect client funds. However, the Financial Conduct Authority (FCA) does not believe the regime is working. The proposals in CP24/20 are intended to address this problem. Interim-state rules will reinforce existing requirements, including by monthly regulatory returns and annual audits. End-state rules will move to a trust arrangement modelled on the regime for investment business, among other changes. As consulted on, the FCA’s proposals will place a greater compliance burden on payments and e-money firms. This may lead to increased enforcement action and consolidation within the sector.
02 March 2025Scottish limited partnerships and fund finance
In this article, the authors consider the versatility of Scottish limited partnerships (SLPs) in fund finance transactions and issues to consider when lenders take security over SLP interests.
02 March 2025Across the pond: practitioner’s guide to fortifying LMA forms for cross-Atlantic transactions
In this article, the authors provide contextual understanding of certain US provisions to supplement the Loan Market Association forms when representing lenders in transactions involving US-domiciled borrowers and/or US-domiciled credit support providers.
02 March 2025
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