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Direct 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 2024Prudential consolidation under the IFPR: making sense of the ancillary services undertakings concept
In this article, Andrew Henderson considers the concept of “ancillary services undertakings” under the new UK Investment Firms Prudential Regime (IFPR) and the UKCRR for banks. He argues that draft European Banking Authority Guidance is useful in delineating the limits of the concept and highlighting the reason for including or excluding entities within a consolidation group.
25 March 2024Protection from creditors: the law’s continuing development for corporates in Ireland
In this article William Johnston considers the new administrative rescue process available to distressed small and micro companies in Ireland. He examines the reform against the backdrop of the existing examinership process available for larger companies.
25 March 2024Transaction finality in blockchains: legal considerations
This article examines the settlement finality in a subtype of blockchains that relies on probabilistic settlement finality. Having studied transaction finality in blockchains, both from a private law and regulatory law perspectives, this article finds that the main difference between settlement in blockchains and those in traditional finance is the absence of intermediaries to whom the legal obligations and liabilities could be assigned in case of settlement fails. In the absence of such intermediaries, the regulatory law may be hesitant to give effect to settlement finality in such blockchains.
25 March 2024Financial sanctions: prohibitions extended to persons “connected with” Russia
This article explores recent developments in the financial sanctions deployed against Russia in response to the invasion of Ukraine with a particular focus on the expanded scope of those measures and the meaning of “connected with” Russia.
25 March 2024Sustainability/ESG ratings: does the market measure up?
In this article, we examine concerns related to the burgeoning sustainability/ESG ratings market identified in policymaker, academic and practitioner research and consider potential regulator interventions that could be on the horizon.
25 March 2024Anticipating an FX spot trade: front running or just trading ahead?
This article considers aspects of the recent decision in The ECU Group Plc v HSBC Bank Plc and Ors,1 in particular concerning the difference between legitimate “trading ahead” and illegitimate “front running” in the context of FX spot trading, and issues of causation. The current regulatory framework around spot FX is also considered before some practical conclusions are drawn.
25 March 2024Saying how versus saying what: the choice of regulatory style in margin policy
Mandatory margin posting on derivatives portfolios is one of the key elements of post-2008 derivatives policy. Margin requirements are often calculated using risk-based models. These models typically require more margin when markets are more stressed. This can create liquidity burdens on market participants just when they are hardest to meet. There are two main approaches to addressing this: requiring that particular tools to reduce variability are incorporated in all margin models; or placing limits on the variability of margin regardless of how it is calculated. This choice is practically important and leads to insights on differences in regulatory style.
25 March 2024
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