Battle of the Forms in the European Private Placement Market

An Analysis and Comparison of the New LMA Private Placement Documentation vs. the ACIC Model X Forms

April 2015

Over the last few years, there have been ongoing discussions and a series of initiatives aimed at developing a “Pan-European Private Placement Market” (PEPP Market) for private placement transactions between European issuers and European investors.

To date, however, the private placement market in Europe remains largely fragmented and regionalized. Among the perceived barriers to the development of the PEPP Market are unfavorable tax and accounting treatment in some European jurisdictions, a tendency towards regionalization, the lack of a perceived need for a separate European market, no established track record for the market and the absence of standardized documentation for this market. In an effort to help move these initiatives forward, the Loan Market Association (the LMA) recently established a working group of industry participants to produce recommended forms intended for use in the PEPP Market. The hope is that standardized private placement documents, developed specifically for use in the PEPP Market, will help remove certain perceived barriers to the development of a cohesive private placement market in Europe by streamlining the documentation process, establishing market standards and reducing transaction costs.

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