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Regulating cryptocurrency by policing advertisements: the approach in the UK, Singapore, India and Spain
In this article the author considers the regulatory approach of four jurisdictions to the policing of cryptocurrency advertisements.
25 March 2024Intralot’s drop-down restructuring games: priming pari passu noteholders, circumventing non-consenters and artificially reducing asset values
Intralot is the first European group to restructure its debt using the “J. Crew”-inspired drop-down procedure, transferring its unencumbered US business away from unsecured noteholders due to be repaid in 2024, to be used to support secured debt to refinance unsecured notes maturing earlier in 2021. The trustee for the notes due in 2024 is suing and there is a separate claim for fraudulent transfer. In this article, the authors explore: how unsecured pari passu and pro rata noteholders came to prime others by becoming senior secured noteholders under the drop-down procedure; how the drop down was achieved by a US subsidiary issuing unsecured notes due 2025, swapping them for the unsecured notes due 2021 issued by a holding company, being designated an “Unrestricted Subsidiary”, with its shares and assets then being pledged as security for the notes due 2025; how Intralot exploited imprecise but standard drafting of the covenants to ensure the value of the US business was low enough to fit within investment basket capacity required to be used for the drop-down; why only 75% of the primed noteholders may have decided to stay being supported by the non-US business rather than exchange for equity in the US business; how the different bargaining power among creditor groups impacted the restructuring and resulted in unequal outcomes for creditors in the same class; how a minority of 2021 noteholders withheld consent to force repayment of 59% of their notes at par prior to the refinancing-by-drop-down; and “J. Crew” blockers as anti-drop-down provisions and their frequency in 2021.
25 March 2024Secured finance law reform: the Joint Coordination Network
In December 2021, the United Nations Commission on International Trade Law (UNCITRAL), the international Institute on the Unification of Private Law (Unidroit), the International Finance Corporation (IFC), the Organisation of American States (OAS) and a few other governmental and non-governmental organisations launched a Joint Network for Coordinating and Supporting Secured Transactions Reforms (Network). The main objective of the Network is to coordinate the activities of participating organisations in providing technical assistance and capacity building to States and organisations in secured transactions and related reforms. The Network also seeks to facilitate the modernisation and enhancement of secured transactions frameworks, particularly through the adoption and implementation of international standards in this area.1 The Network is the result of four coordination conferences jointly organised and held by the members of the Network in recent years.
25 March 2024Interpreting statutes and contracts: what are the differences? Part II
In the first part of this article ((2022) 3 JIBFL 192), it was suggested that the basic principles of interpretation are common to all types of legal texts but that the different nature of statutes and contracts means that the application of those principles can differ depending on whether the instrument concerned is a contract or a statute. The first of those differences concerned the identification of the text itself: the text of a statute is easier to establish than the text of a contract.
25 March 2024Synthetic Securitisation made simple: the EU STS securitisation framework embraces synthetic securitisation
In this article, Timothy Cleary analyses the new EU STS framework for synthetic securitisation and comments on its implementation and implications for the UK.
25 March 2024Delegation not abdication: directors’ duties under scrutiny in syndicated loans
In syndicated lending it is common for lenders to delegate functions to an Agent and equally common for companies within a group to authorise the parent to act on their behalf. That has ramifications for the directors of the delegating companies – and for the directors of the delegate. This article considers the issues which may arise.
25 March 2024Knowing receipt and the proprietary base: Part II
In Byers v Samba Financial Group [2021] EWHC 230 (Ch), Fancourt J held that a knowing claim could not be maintained against a knowing recipient where the claimant’s proprietary interest had been extinguished by or before receipt. The Court of Appeal has now affirmed that decision: [2022] 4 WLR 22. The court’s reasoning helpfully elucidates the theoretical basis of knowing receipt-based liability (appearing to espouse a property-based theory), but risks significantly curtailing the remedies available to beneficiaries in cases involving trust assets located abroad.
25 March 2024Direct Lending in a distressed world
In this article the authors consider what makes funds behave differently to banks in a distressed scenario and some specific issues faced by funds.
25 March 2024Secondary obligations and disguised penalties: where does the law stand following Makdessi?
In the joined appeals of Cavendish Square Holding BV v Talal El Makdessi, ParkingEye Limited v Beavis [2015] UKSC 67; [2016] AC 1172 (Makdessi), the Supreme Court reformed the modern penalty clause doctrine, including by emphasising that it is available only in relation to secondary obligations, which must be classified as a matter of substance not form. This article considers this threshold test and the issue of so-called “disguised penalties” in English law following that decision.
25 March 2024Foreign financial crises and the consumer
This article considers two recent cases involving claims against Lebanese banks by claimants wanting to withdraw foreign currency and seeking to invoke the special regimes for consumers that apply in relation to: (i) jurisdiction; and (ii) applicable law. In the first case, Bitar v Banque Libano-Française SAL [2021] EWHC 2787 (QB)(Bitar), the court considered the question of jurisdiction. In the second case, Khalifeh v Blom Bank SAL [2021] EWHC 3399 (QB) (Khalifeh), the court considered the question of applicable law.
25 March 2024
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