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Collective stress or collective redress? Examining available mechanisms for securities litigation in England and Wales
It has been a turbulent few years for mass litigation in England and Wales. The advent of new collective procedures and revival of old ones has seemingly gifted claimant investor groups an abundance of choice. But the precise boundaries of the various mechanisms available seem to be in a constant state of flux. This article examines the current state of play through the prism of securities litigation and seeks to identify key considerations and future trends.
18 March 2024Liquidity covenants to the fore
With interest rates remaining at record levels and businesses still struggling with increased costs and the fall-out from the cost-of-living crisis, many businesses have been unable to meet leverage maintenance covenant requirements in their deals. As a quid-pro-quo for covenant relief, lenders often seek to impose a minimum liquidity covenant to ensure the business remains operationally solvent during the covenant relief period. This article explores what a liquidity covenant is and the issues facing sponsors and lenders in negotiating them.
18 March 2024Significant Risk Transfer’s impact on the output floor under Basel III: the EU’s proposed panacea unveiled
The European Banking Authority, in its Basel III full implementation impact report11 found that European banks’ Tier 1 capital requirements would increase by 15% as a 1result of Basel III changes, with the proposals for an output floor being responsible for a 7.1% overall rise. In this article, the authors consider how significant risk transfer (SRT) transactions can be used to decrease a bank’s risk weighted assets (RWAs) in order to minimise their capital burden in light of increased capital requirements as a result of the output floor. Other capital requirements specific to securitisations are also considered.1 1
18 March 2024Foreign crypto arbitrations and UK consumer rights: a culture clash?
In this article, Lara Kuehl discusses the enforceability of arbitration agreements which provide for foreign (non-UK) seated arbitration and foreign governing laws, commonly found in the terms of service of crypto exchanges and platforms, in contracts with UK consumers.
18 March 2024For whom the code tolls: an integrated, modular architecture for smart derivatives contracts
In this article, we dissect the complex interplay between law and technology in the derivatives market and describe an approach for developing modular, smart contracts. We draw parallels between legal prose and programming, advocating for a formalised approach to contract drafting that accommodates smart contract technology. The Common Domain Model is identified as a pivotal tool, providing a standardised representation of contractual terms that ensures clarity and consistency across the industry. Using this standard framework, we demonstrate how to embed traditional contracts within a modular, composable smart contract architecture.
18 March 2024New challenges for tackling Authorised Push Payment fraud
The Payment Systems Regulator (PSR) has recently announced significant changes to the mandatory reimbursement regime for Authorised Push Payment (APP) fraud that will be implemented during 2024. The scheme is likely to create difficulties for financial institutions preparing for the far-reaching changes. This article summarises the reforms, explores the challenges and provides suggestions for preparing for the new measures.
18 March 2024ESG litigation in the context of financial services: a global gear change?
This article examines the way that ESG-related cases in the context of financial services have evolved over the past few years, and the themes emerging from the high number of court dismissals during 2023, which indicates that legal merits continue to be the prevalent factor.
18 March 2024Regulation 7(4): when is an entity “controlled” by a sanctioned person?
In this article Tom Leary explains the key decisions in the Mints litigation on issues of “control”, why the Court of Appeal’s approach to Reg 7(4) of the Russia (Sanctions) (EU Exit) Regulations 2019 is unsurprising given the genesis of its drafting, and the practical implications for practitioners.
18 March 2024Limited liability partnerships: authority to borrow and to give security
This article addresses two related practical issues which arise in acquisitions, restructurings and financing transactions where a limited liability partnership (LLP) is involved in the group structure. The first is the authority needed by a lender where an LLP is giving a guarantee of group companies’ liabilities and/or granting security. The second is the related point about charging the interests of a member in an LLP.
18 March 2024Identifying floating charges after Re Avanti Communications Ltd (in Administration)
This article discusses the decision in Re Avanti Communications Ltd (in Administration) and how the criteria laid down in the case affect the characterisation of charges over different types of assets as being either fixed or floating.
18 March 2024
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