As dealmaking surges in most parts of the world, investors and companies are jockeying for new market positions. The dramatically different landscape of how people work, where they travel, and what they buy in a global economy still recovering from a major public health crisis has brought both opportunity and challenge. Assets for individual and company consumers may be tough to come by as international supply chains and trade restrictions remain in flux. Morgan Lewis lawyers from around the globe address these issues by offering insight into merger and acquisition trends, international trade and sanctions, and the global supply network.
The UK Prudential Regulation Authority (PRA) and Financial Conduct Authority (FCA) (jointly, the Regulators) are proposing to remove the bonus cap for banks, building societies, and PRA-designated investment firms. The consultation is underway and closes on 31 March 2023. If the bonus cap is scrapped, it will likely affect remuneration referable to performance periods commencing from 2024. In-scope firms should keep this development under review so they can swiftly respond to any increased flexibility in employee remuneration arrangements.
With the ever-increasing use of sanctions as a foreign policy tool (or weapon), sanctions compliance has taken on greater importance than ever. Moreover, as countries increase extraterritorial applications of their sanctions, even companies outside the implementing countries may be affected by these actions.
The number of Japan’s corporate venture capital (CVC) funds, which invest corporate funds directly in external startup companies, and amount of their investments have risen markedly in recent years. This is especially true in areas of digital transformation (DX) and climate change.
The European Union’s Foreign Subsidies Regulation (FSR), published on December 23, 2022, entered into force on January 12, 2023. The FSR will apply with most of its provisions six months after its entry into force—i.e., on July 12, 2023. The FSR will grant the European Commission (EC) new enforcement powers to address subsidies received by companies from third-country governments or public entities. In yet another game-changing move towards ex ante regulation by the EC, the FSR will require companies operating in the EU to report their M&A transactions as well as their participation in public procurement tenders if backed by foreign subsidies. The FSR will also allow the EC to investigate ex officio any economic activity carried out in the EU in such cases. This report provides a detailed overview of the adopted FSR, which introduces new red tape for all companies operating in the EU in case they benefit from support from third-country governments in the broadest sense.
The Internal Revenue Service (IRS) issued proposed regulations under Sections 892 and 897 of the Internal Revenue Code of 1986, as amended, on December 29, 2022. Final regulations under Section 897 regarding the exemption for “qualified foreign pension funds” from taxation under the Foreign Investment in Real Property Tax Act of 1980 were issued the same day.
While keeping no-visa entry from China for eligible nationals, on-arrival testing and a negative test result certificate are required for entrants from China due to the COVID-19 outbreak in China.
Geopolitical, trade, and investment tensions between the United States and China continue due to differences on such issues as the Russia-Ukraine conflict, Taiwan, Xinjiang, Hong Kong, Tibet, the South China Sea, human rights, and more. US issuers should review their current exposure to the China market and adjust their risk factor disclosures in upcoming annual reports, as appropriate, to take into account recent developments.
Partners Chris Warren-Smith, Louise Skinner, Paul Mesquitta, and associate Keir Baker co-wrote the chapter, “Collective Actions in the UK and EU Two Years On: The Groundswell Continues,” for Class and Group Actions Laws and Regulations 2023, a guide from International Comparative Legal Guide.
The US Department of the Treasury’s Office of Foreign Assets Control issued a Determination on December 5 implementing a $60 “price cap” on Russian crude oil, pursuant to which US persons are authorized to provide otherwise prohibited services. The waiver applies only to the maritime transit of Russian oil purchased at or below the price cap.
The European Court of Justice in a recent judgment nullified a key provision in the 2018 version of the EU Money Laundering Directive requiring that information regarding beneficial owners registered in the European national transparency registers be publicly accessible.
The US Department of Commerce (DOC) issued its preliminary determination on December 2, 2022, related to circumvention of antidumping and countervailing duty (AD/CVD) orders A-570-979 and C-570-980 (the Orders) with respect to Cambodia, Malaysia, Thailand, and Vietnam. DOC determined that imports of certain crystalline silicon photovoltaic (CSPV) cells exported from Cambodia, Malaysia, Thailand, or Vietnam using parts and components produced in China are circumventing the AD/CVD orders on solar cells and modules from China.
European commercial real estate (CRE) lending markets face a difficult environment, resulting from a higher than usual cost of debt and declining property valuations. In the face of such uncertainties, we examine how private credit funds with a real estate debt strategy might nonetheless take advantage of funding opportunities and what considerations might shape how back leverage providers choose to participate.
Based on consistent comments by the US Congress, think tanks, and the US-China Economic and Security Review Commission, several members of Congress proposed legislation to shift jurisdiction for export controls from Commerce to the Defense Technology Security Administration.
The Singapore Exchange Regulation (SGX RegCo) published a public consultation paper proposing to amend the Listing Rules to impose a hard nine-year limit on the tenure of independent directors, removing the current two-tier voting rule. The SGX RegCo is also proposing mandatory disclosures of the actual amounts of the remuneration of each listed company director and chief executive officer.
The European Commission recently published its long-anticipated report to the European Parliament and the Council of the European Union on the functioning of the EU Securitisation Regulation. The report contains important conclusions that are relevant for entities established in the European Union and involved in securitisations, and for non-EU entities involved in securitisations with EU entities.
The United Kingdom’s Office of Financial Sanctions Implementation (OFSI) has granted the London Court of International Arbitration (LCIA) a General Licence allowing it to process payments from designated parties (DPs) who are subject to the United Kingdom’s recent financial sanctions against Russia and Belarus.
Welcome to Morgan Lewis’s Takeover Monitor Germany. This publication aims to provide funds, public and private companies, and other entities involved in capital markets transactions with a regular documentation of current public tender offers under the German Securities Acquisition and Takeover Act (WpÜG).
The Hong Kong Stock Exchange (HKEx) has issued its much-anticipated consultation paper on creating a listing regime for Specialist Technology Companies (STCs) under proposed Chapter 18C of the HKEx listing rules, with a view toward launching in the first half of 2023. The new listing regime eases the existing profit and trading record requirements under the listing rules for STCs, and is expected to facilitate a number of large, emerging, and innovative technology enterprises with high growth potential to list on the HKEx.
The US Department of Commerce’s Bureau of Industry and Security (BIS) released an interim final rule (IFR) on October 7, 2022, imposing additional export controls on certain advanced computing and semiconductor manufacturing items destined for the People’s Republic of China (China), with the goal of limiting China’s access to key US technologies.
The UAE enacted a new Federal Law No. 38 of 2021 concerning copyright and neighboring rights (New Law) that replaced the old Federal Law No. 7 of 2002 (Old Law) and came into force in January 2022. The New Law provides a clearer framework in an increasing digital environment for businesses.
Kwasi Kwarteng, the Chancellor of the Exchequer of the new UK government led by Prime Minister Liz Truss, presented his “Growth Plan 2022” to Parliament on 23 September 2022. The Growth Plan 2022 outlines the UK government’s plans to tackle inflation, the cost of living, and energy crises and expand the supply side of the economy. In particular, the chancellor announced new measures to unlock investment by UK pensions schemes in private assets.
The UK Law Commission is currently undertaking a review of the Arbitration Act 1996, the principal legislation governing arbitrations in England, Wales, and Northern Ireland, to ensure it is as “clear, modern, and efficient as possible.” It set out its key proposals for this goal in a recent consultation paper.
The UK government’s “Growth Plan” (or “mini-budget”), delivered on 23 September, announced that the recent changes to the United Kingdom’s off-payroll working rules will be repealed with effect from April 2023.
The Department of Defense issued an interim rule amending the Defense Federal Acquisition Regulation Supplement to require bidders on defense contracts to disclose when work will be performed in the People’s Republic of China, furthering the isolation of targeted countries deemed a threat to US national security at various points in the supply chain.
President Joseph Biden’s recently issued Executive Order provides guidance related to the US national security foreign direct investment review process administered by the Committee on Foreign Investment in the United States. The Executive Order reiterated several common themes, confirmed the scope of various factors identified in the Defense Production Act Section 721 as amended by the Foreign Investment Risk Review Modernization Act of 2018, but also clarified and added insight into the fluid nature of CFIUS’ national security analysis.
The French regulator, the Autorité des Marchés Financiers (the AMF) has recently published a report (the AMF Report) following its inspection, involving a sample group of credit institutions, of certain simple, transparent and standardised (STS) securitisation transactions covering the period between 1 January 2019 and 30 September 2021. The AMF Report noted significant shortcomings in the due diligence process of these institutions, particularly the arrangements relating to the granting, monitoring, and withdrawal of the STS label.
Due to a recent agreement between the Public Company Accounting Oversight Board and Chinese securities regulators, many US exchange–listed companies audited by accounting firms based in mainland China and Hong Kong may be able to continue trading on US exchanges, preserving liquidity for investors and ongoing access to US capital markets. However, this agreement could lead to an increased enforcement risk through more regulatory inquiries.
The United Kingdom launched a new visa route on 22 August that allows businesses that have demonstrated a sustained period of growth to recruit highly skilled individuals to support them in their continued growth.
The judgment of ZF v. Comptroller of Income Tax was a seminal decision by the Singapore Court of Appeal in 2010, which influenced how capital allowances were claimed and granted in the years since. There hasn’t been a challenge heard at the Income Tax Board of Review in over a decade until the Board’s decision in GEY v. Comptroller of Income Tax dated 29 August, which provides a much-anticipated insight into how the principles and concepts enunciated in ZF have been canvassed and are to be regarded. This LawFlash highlights the facts and learning points for companies who have claimed or are intending to claim capital allowances for their assets.
On August 19, Russian State Duma member Andrey Kuznetsov introduced a bill on compulsory licensing of copyrights that allows the courts to approve compulsory licenses for content and other copyrightable objects not available in Russia.
Restructuring debt obligations under Singapore law can be an attractive option for companies seeking debtor-led reorganisations, as the country aims to be a centre for debt restructuring in Asia. There are options for non-Singapore companies to take advantage of the jurisdiction’s scheme of arrangement regime.
The Singapore High Court has clarified the definition of “centre of main interests” in the context of a crypto exchange group seeking to restructure its collective debts in Singapore. The analysis has implications to any group business which has interconnected shared services provided by the group companies in a collective service “ecosystem” to customers.
The UK Home Office announced the removal of the police registration requirement for relevant nationals. It has also reinstated priority processing services for overseas work and study visa applicants.
The European Banking Authority (the EBA) recently published a consultation paper with proposed amendments to the regulatory technical standards (RTS) on the homogeneity of the underlying exposures in securitisation, following amendments to the EU Securitisation Regulation which allow on–balance sheet synthetic securitisations to be designated as simple, transparent and standardised (STS).
Russian President Vladimir Putin issued a decree imposing an overall ban on transactions with certain assets, such as securities in certain Russian companies and interests in certain Russian investment projects, if these securities and interests are owned by persons from the so-called "unfriendly states" or persons controlled by such. Assets include shares in certain Russian major entities, energy and subsoil companies and projects, and Russian banks. The new ban restricts the ability of investors to exit from their Russian investments or to restructure their Russian holdings without specific permission of the Russian president.
EU simple, transparent, and standardised (STS) securitisations may be recognised as STS for the purposes of the UK Securitisation Regulation if they are designated as STS under the EU Securitisation Regulation regime before the end of 2022. A draft UK statutory instrument proposes to extend that recognition for an additional two years.
The Hong Kong Stock Exchange (HKEx) adopted the proposed amended Listing Rules as set out in its Consultation Paper with certain amendments, including changes to share schemes of subsidiaries of listed issuers, share schemes funded by issuance of new shares of listed issuers, and share schemes funded by existing shares of listed issuers, among others. The approved amended Listing Rules will become effective on January 1, 2023.
The rules for taxation of dividends in respect of shares that are included in the official listing of a stock exchange in Kazakhstan will significantly change as of 1 January 2023.
The Cyberspace Administration of China released for public consultation its long-awaited template for the cross-border data transfer agreement on June 30, 2022, under the draft Provisions on the Prescribed Agreement on Cross-border Data Transfer. The consultation period ends July 29, 2022.
Russian Decree No. 430 was signed on July 5, establishing a basic framework for the replacement of Eurobonds with Russian bonds. The Decree also confirms that debts owed to Russian participants of international syndicates of banks must be repaid directly—not through facility agents from “unfriendly states”—and in rubles at the lender’s option, but at the same time substantially relaxes the repatriation rule with respect to exempt contracts.
Puerto Rico Governor Pedro Pierluisi signed Act No. 41-2022 on June 20, 2022, amending and repealing certain sections of the Labor Transformation and Flexibility Act of 2017, also known as the 2017 Labor Reform. The act aims to restore and broaden labor rights for workers in the private sphere and to have the Legislative Assembly inquire into prevailing work conditions and propose new protections for the working class.
The UK’s national security and investment regime came into effect on 4 January 2022. On 16 June, the UK government published its first report on the operation of the regime for the period between 4 January and 31 March (Report). The Report shows that during the initial three-month period, the UK government received 222 notifications, out of which it only called in for investigation 17 transactions, clearing three (with the remaining 14 pending at the end of the reporting period).
Leading up to the June 21 effective date, US Customs and Border Protection issued operational guidance and a strategy document to assist importers with Uyghur Forced Labor Prevention Act compliance and to define its enforcement strategy. While the enforcement tools are consistent with existing forced labor mechanisms, the act’s evidentiary standard is expected to be significantly higher. Preparing for compliance presents many challenges, but there are steps importers can take now to mitigate delays.
The Securities and Futures Commission recently issued a consultation paper on proposed enforcement-related amendments to the Securities and Futures Ordinance, the principal legislation that regulates the securities and futures industry in Hong Kong. The proposal is a significant step toward aligning the regulatory regime with other major common law jurisdictions and a legislative development not seen in Hong Kong since the law was enacted and came into force in 2003.
A new statement from the Russian Ministry of Finance requires Russian borrowers to repay debt owed to Russian lenders participating in international syndicates directly (bypassing mechanisms established by the relevant loan agreements). This requirement may potentially result in large-scale defaults of Russian borrowers.
The Dubai Financial Services Authority (DFSA) has implemented a new regime for credit funds, which comes into force on June 1, 2022. The new regulation primarily impacts the managers of credit funds domiciled in the DIFC, but there are some implications for non-DIFC credit funds. The new regulation results in heightened regulation of DIFC credit funds and their managers (as compared to other DIFC funds and their managers) and, in practice, will likely operate as a new licensing category, with higher fees and additional compliance obligations.
Russian President Vladimir Putin signed Decree No. 322 “On Temporary Regime For Performance of Obligations Towards Certain Rightsholders” on May 27, prohibiting Russian residents from making license payments to foreign bank accounts of rightsholders residing in “unfriendly states” or otherwise supporting sanctions against Russia.
This blog post is Part 2 in the “Ready for a Sale?” series, which is aimed at getting the human resources, benefits, and executive compensation functions of your organization ready for a potential sale or similar corporate transaction. Part 1 provided general guidelines and suggestions on how to get organized and start the process. This second part will address key considerations in the process that often arise early: (1) identifying, assembling, and analyzing documents that will be automatically triggered or impacted by the potential sale, and (2) determining the expected impact of the transaction on any outstanding equity compensation.
Russia President Vladimir Putin signed the federal law, “On Amendments to the Federal Law ‘On Measures of Influence (Counteraction) on Unfriendly Actions of the United States of America and Other Foreign States,’” on May 1, substantially restricting the ability of Russian banks to disclose information to foreign regulators, in particular, under the US National Defense Authorization Act.
Turkmenistan, a holder of one of the world’s largest natural gas reserves, has recently taken steps to improve its business climate. In May 2022, Turkmenistan acceded to the New York Convention on the Recognition and Enforcement of Foreign Arbitral Awards, the UN Convention on Contracts for the International Sale of Goods, and the Framework Agreement on Cross-Border Paperless Trade in Asia and the Pacific.
In light of the active M&A market, we think this spring could be an ideal time for companies to evaluate the order of their executive compensation arrangements and employee benefit plans, particularly companies that are considering (or hoping for) a sale within the short-term future.
The European Banking Authority recently published its final draft of the regulatory technical standards in relation to risk retention under the EU Securitisation Regulation. This LawFlash covers some of the key aspects of these draft regulatory technical standards.
Both Congress and the executive branch have been considering the notion of a new regulatory regime to limit certain types of US outbound investment in other countries. While such a regime would certainly constitute a sea change in US national security and economic policy, most commenters have largely overlooked the potential for US regulation of outbound investment to trigger similar regimes abroad, and thereby exponentially increase the effect on industry.
Following previously adopted restrictions on payments of dividends in joint stock companies, Decree No. 254 requires that any dividend payment from a limited liability company to its foreign participant connected with an “unfriendly state” must be made in Russian rubles and to a special blocked type “C” account, subject to certain exceptions.
Russian President Vladimir Putin issued a decree listing several retaliatory special economic measures against legal entities and individuals, as well as organizations controlled by them, to be designated by the Russian government.
When two parties engage in a merger or acquisition, there are several processes that must take place before the transaction can be completed, including due diligence of the seller’s assets—and particularly the seller’s relevant and material intellectual property (IP).
The United Kingdom has finalized its ban on the delivery, sale, transit, and export of luxury goods to Russia, focusing on items that will impact Russian oligarchs and other members of the Russian elite.
The Central Bank of the Russian Federation has recently been active in adopting secondary legislation clarifying and implementing presidential decrees on cross-border transactions. Such legislation imposes new restrictions which need to be considered in commercial dealings involving Russia.
A new federal law in Russia prohibits Russian issuers from having their shares traded outside Russia via depositary receipts and requires issuers with existing programs to take delisting measures unless they receive a governmental approval to keep the program.
The draft law on external management was submitted to the Russian Parliament and differs considerably from the previous version. The new draft provides for the establishment of a special interdepartmental commission that will have broad powers to impose external management on any company as it deems necessary. The law is still proposed to apply to circumstances that occurred from February 24. If adopted, the law will create further uncertainty in Russian markets.
The US Securities and Exchange Commission proposed rules on March 28 that would require certain market participants to register as broker-dealers or government securities dealers, and potentially be subject to oversight by self-regulatory organizations such as the Financial Industry Regulatory Authority. These proposed rules have the potential to bring a wide array of private funds, digital asset traders, certain exchange traded products, high frequency traders, and other proprietary traders within the definition of the term dealer (or government securities dealer), bringing an additional level of unnecessary costs and regulatory requirements to firms that generally do not have customers.
The US Securities and Exchange Commission recently proposed new rules and amendments relating to initial public offerings by special purpose acquisition companies and to business combinations involving shell companies and private operating companies. While the proposed rules would enhance investor protections, it is possible they could have a cooling effect on the volume of such transactions or materially increase the costs of deal execution.
Russia proposed a draft federal law on April 8 amending article 235 of the Russian Civil Code, which would allow the compulsory seizure of assets in cases stipulated by federal laws, and containing rules about such compulsory seizure from persons from, or connected with, the so-called “unfriendly states.” If adopted, this law would create a framework permitting nationalizing assets of these persons without compensation.
The European Union, United Kingdom, and United States have introduced a number of extensive sanctions against Russia in relation to the delivery, sale, transit, and export of luxury goods, with the intention of focusing on items that will impact Russian oligarchs and other members of the Russian elite.
An insolvency moratorium first introduced during the COVID-19 pandemic applies to nearly all Russian legal entities, individuals, and sole entrepreneurs, and bans the commencement of insolvency proceedings against Russian obligors.
A Special Purpose Acquisition Company (SPAC) is a blank-check company formed for the purpose of effecting a business combination with one or more businesses. While SPACs are not new, they have recently increased in prevalence. In 2021, there were 613 SPAC initial public offerings (IPOs), a significant increase from 248 in 2020. The total SPAC IPO proceeds also increased from $83 billion in 2020 to more than $160 billion in 2021. De-SPAC merger activity in 2021 was also high, as 267 were announced and 199 closed.
In recent years, the US Department of Justice (DOJ) and US Securities & Exchange Commission (SEC) have further defined their anti-corruption due diligence and disclosure expectations of acquiring companies pre- and post-acquisition. Notwithstanding the government’s efforts to clarify expectations and promote greater transparency, acquiring companies remain at risk of inheriting liability as successors (or joint venture partners) and may face enforcement actions should they not swiftly discover and stop any misconduct from continuing post-acquisition. In other words, what you don’t know can at times hurt you, but the risk of pain significantly increases when you do know but don’t take steps to fix the inherited problems.
President Biden on March 15 signed into law the Adjustable Interest Rate (LIBOR) Act, which aims to reduce uncertainty regarding the effect of ending LIBOR on existing USD LIBOR transactions, as part of an omnibus spending package.
US President Joseph Biden issued a directive to the secretary of defense on March 31, invoking the Defense Production Act (DPA) to spur the domestic production of critical minerals needed to produce large-capacity batteries for the automotive, emobility, and stationary electricity storage sectors.
As another measure to support Russia’s financial market, Presidential Decree No. 126 imposes further limitations on cross-border monetary transfers for both Russian and non-Russian residents. However, Decree No. 126 also gives Russian regulators broad discretion to make exceptions from the previously adopted general bans and specific restrictions.
In response to sanctions adopted by the United States, the European Union, and other countries in relation to Russia’s operations in Ukraine, the Russian government is taking steps to adopt measures affecting foreign investors’ rights, from nationalization of assets to non-protection of intellectual property rights.
The conflict in Ukraine has resulted in the disruption of innumerable commercial agreements between and among financial, manufacturing, and other entities. The sanctions imposed by nations and international bodies on various Russian and Belarusian persons and entities as a result of the conflict (Ukraine-Related Sanctions) are in many ways exceptional in their coordination, breadth, and speed. Russia has imposed initial countermeasures in response to the Ukraine-Related Sanctions, which could also affect the performance of commercial agreements by parties across the globe. Many US businesses are considering whether (and if so, how) the operations in Ukraine or the Ukraine-Related Sanctions might impact their and their counterparties’ obligations under agreements that require performance by or with sanctioned entities.
President Joseph Biden issued Executive Order 14068 on March 11 expanding prohibitions on trade with Russia and announcing new restrictions on Russian imports, exports, and investments—including luxury goods. This executive order, implemented through regulations issued by the Department of Commerce’s Bureau of Industry and Security, directly impacts many retailers, as it effectively restricts US retailers and businesses from suppling any luxury items, as defined by the regulations and the customs tariff codes to Russia. This edition of Morgan Lewis Retail Did You Know? analyzes the executive order—the latest in a series of regulatory actions targeting Russia as a result of the crisis in Ukraine—the Department of Commerce’s implementing regulations under the executive order, and the practical impact both have for retailers.
Russia is considering introducing legislation that, if adopted, will have a dramatic impact on foreign-owned businesses and their strategies concerning Russia. The goal of the proposed law is to (1) warn foreign owners that they may lose their Russian companies if they abandon them and (2) conserve business and preserve jobs by allowing the sale of affected companies’ assets to a Russian third-party.
The UK Financial Conduct Authority (FCA) released a statement on February 14 confirming a series of changes to potentially unfair contract terms that had been agreed with four of the largest providers of Buy Now, Pay Later (BNPL) products operating in the United Kingdom.
President Vladimir Putin issued a decree introducing a special procedure for repayment of debt by the Russian state bodies as well as Russian residents (Russian Debtors) to non-Russian creditors related to foreign states that commit “unfriendly actions towards Russia” or that are controlled by such non-Russian creditors (deemed “Creditors from Unfriendly States”). The new procedure will apply to payments exceeding 10 million rubles ($95,000) per month and effectively prevent the free receipt of repayment amounts by Creditors from Unfriendly States.
The Bank of England (Bank) and the UK Financial Conduct Authority (FCA) published their final report of discussions from the UK Artificial Intelligence Public-Private Forum on February 17. Over quarterly meetings and several workshops conducted since October 2020, the Bank and the FCA jointly facilitated dialogue between the public sector, the private sector, and academia in order to deepen their collective understanding of artificial intelligence (AI) and explore how to support the safe adoption of AI. This initiative was incorporated into the UK National AI Strategy.
In connection with recent Russia-related sanctions issued by the US government, organizations face a variety of issues when navigating the questions of who and what transactions may be subject to the reach of these sanctions. Economic sanctions administrated by the US Department of Treasury’s Office of Foreign Asset Control (OFAC) are often intended to have extraterritorial effect, and therefore can impose significant compliance costs and penalties on US subsidiaries as well as their non-US affiliates or parent entities.
The COVID-19 pandemic created many uncertainties and challenges for investors and operators alike across the Middle East, including in the United Arab Emirates, which is often considered a regional healthcare and business hub. As a result, 2020 saw many transactions in the healthcare sector either abandoned or put on hold, but the region has since demonstrated signs of a strong recovery in the transactional space in general and particularly in the healthcare industry.
The Financial Services and Markets Bill 2022, the goal of which is to address risks and challenges that impact institutions across the financial sector, was recently moved for first reading in the Parliament of Singapore on 14 February. The bill will grant the Monetary Authority of Singapore additional regulatory powers to address misconduct, cryptoassets, and technology risks and to deal with various financial institutions, including banks, insurers, financial advisers, virtual asset service providers, trustees for collective investment schemes, trustee-managers of business trusts, licensed trust companies, and operators of payment services.
The European Union’s 25 February wave of sanctions build on, and significantly expand, its existing sanctions on Russia, imposing wide-ranging restrictions on the Russian economy—including in respect of Russia’s access to financial and capital markets—and the oil refining, aviation, and space sectors. More sanctions from the European Union are expected in the coming days, along with announcements on the disconnection of certain Russian banks from the SWIFT system.
President Vladimir Putin issued a decree, “On Special Economic Measures in connection with the Unfriendly Actions of the United States of America and Other Foreign Countries” (Decree), on 28 February. This is the first decree addressing Russian economic measures to respond to the recent sanctions adopted by several countries in connection with the current geopolitical situation.
The United States, in concert with Western allies, has imposed sweeping sanctions on Russia in response to President Vladimir Putin’s action in Ukraine. In addition to a full suite of sanctions administered by the US Department of Treasury/Office of Foreign Assets Controls (OFAC), the US Department of Commerce has issued amendments to the Export Administration Regulations (EAR) that impose new restrictions on exports, re-exports, and retransfers of items subject to the EAR to Russia (and releases in Russia), established policies of denial for license applications, and transferred military end users to the Entity List.
While international humanitarian law (ius in bello) also protects personal property, it is only enforceable on a State-to-State level. International investment law, however, provides for direct recourse by the investor against the host State and can therefore be a powerful and effective means of protecting investments during and after armed conflicts.
In response to the Russian Federation’s recognition of certain regions of Ukraine as independent states which followed an expansion of nearly 200,000 troops on the Ukrainian border, US President Joseph Biden authorized the imposition of additional sanctions against Russia and indicated that further sanctions were under consideration. This LawFlash summarizes these newly issued sanctions.
The Singapore Parliament recently passed the Corporate Registers (Miscellaneous Amendments) Act, which seeks to amend the Companies Act 1967 and the Limited Liability Partnerships Act 2005 to strengthen Singapore’s corporate governance regime and improve the transparency and beneficial ownership of companies and limited liability partnerships.
Welcome to Morgan Lewis’s Takeover Monitor Germany. This publication aims to provide funds, public and private companies, and other entities involved in capital markets transactions with a regular documentation of current public tender offers under the German Securities Acquisition and Takeover Act (WpÜG). With this special issue we supplement the documentation with respect to recent judgments of the German Federal Court of Justice relating to public tender offers under the WpÜG, and legislative developments relating to German takeover law.
The second amendment of the Ordinance on the Designation of Critical Infrastructures under the BSI Act entered into effect on January 1, 2022. Such amendment broadens the definition of “critical infrastructures,” which are of particular relevance for Germany’s foreign direct investment screening regime.
A relatively new international dispute resolution venue, the Court of Astana International Financial Center (AIFC Court) launched its activities in 2018 to handle commercial disputes falling under its purview. This LawFlash focuses on the practical aspects to consider when contemplating choosing the AIFC Court as a dispute resolution forum.
During an address to the Parliament’s Mazhilis on 11 January 2022, the president of Kazakhstan instructed the respective state bodies to “secure a strict monitoring, inspection, and control of all transactions and persons who unjustifiably diverts funds out of the country.” In conjunction with this address, as it follows from the government’s papers, Kazakhstan plans to revise the exemptions (incentives) related to the taxation of dividends, including dividends paid to non-residents.
The president of Kazakhstan signed a new law on 30 December 2021 introducing changes into several legislative acts. The most significant amendments in Law No. 95-VII concern regulation of state inspections and are apparently intended to better protect the legitimate interests of businesses.
In two draft companion guidance documents, the US Food and Drug Administration (FDA) establishes a proposed framework for transitioning medical devices currently marketed under emergency use authorization (EUA) or enforcement policy guidance to permanent marketing authorization. The draft FDA guidance documents provide manufacturers a 180-day transition period to submit a marketing application and stress that they should submit permanent marketing authorizations prior to finalization of the guidance documents.
The Court of Appeal of Singapore considered that a “manifestly incoherent” arbitral award would mean parties have not been accorded a fair hearing and a remission would not be appropriate where it is objectively assessed that there is a loss of confidence in the tribunal’s ability to come to a fair and balanced conclusion on the issues if remitted, together with the procedural requirements for a setting aside application to be made in time.
The UK Competition and Markets Authority updated its guidance on the merger control regime in the United Kingdom on 4 January 2022—the same day the National Security and Investment Act 2021 came into effect. The updated merger guidance clarifies that the new national security regime is separate to UK merger control and that transactions may be subject to both regimes.
While the global pandemic that began in 2020 continued throughout 2021, cartel enforcement activity increased among a number of leading enforcement jurisdictions.
It is the prerogative of government authorities—US and non-US alike—to demand information from individuals or organizations and seek the assistance of courts to enforce compliance. Although such demands take various forms, one of the most common is a subpoena, which is a formal legal request to obtain information from an individual or organization over whom or which the courts or government agencies believe they have jurisdiction.
The Hong Kong Stock Exchange concluded its consultation to create a listing regime for special purpose acquisition companies in Hong Kong. The approved new listing regime will come into effect on January 1, 2022 with certain amendments to the original proposals.
The United Kingdom’s Foreign, Commonwealth & Development Office (FCDO) and Office of Financial Sanctions Implementation (OFSI) have announced they will change the structure and format of the UK Sanctions List and OFSI’s Consolidated List in February 2022.
Welcome to ETF Roundup, our guide to the latest legal and regulatory developments affecting the exchange-traded fund (ETF) industry.
Directors have significant ongoing duties towards the company they lead, including taking the changing factual landscape into account. This should include learning lessons from the recent disruption of global supply chains.
In Energy Central, partner Daniel Skees and associate Arjun Ramadevanahalli write that the US Department of Energy’s notice of Request for Information seeking public input on energy supply-chain issues and related technologies will be significant to the nation’s efforts at meeting emissions goals—including the licensing and deployment of advanced nuclear reactors.
In the wake of the COVID-19 pandemic, the global healthcare services sector has unsurprisingly been thrust into the limelight as it has been tackling an ongoing backlog. Following a decline in activity during the first, and most damaging, months of the pandemic, the United Kingdom has seen a marked uptick in the level of healthcare mergers and acquisitions (M&A) activity commencing towards the end of 2020 and continuing throughout 2021. This LawFlash discusses some of the trends contributing to the changing healthcare services M&A market in the United Kingdom, as well as essential considerations for conducting M&A in this sector.
The UK Law Commission has announced that it will carry out a review of the Arbitration Act 1996, the principal legislation governing arbitrations in England, Wales, and Northern Ireland. The Law Commission has stated that its aim is to ensure that the Arbitration Act remains clear, modern, and efficient in order to maintain the United Kingdom’s attractiveness as a destination for dispute resolution.
The Federal Register recently published the US Department of Energy’s (DOE) notice of Request for Information (RFI) seeking public input on energy sector supply chains. The RFI requests that stakeholders provide comment on a wide variety of issues concerning supply chains of energy and related technologies.
So far in 2021, we have seen more than 500 Special Purpose Acquisition Companies (SPACs) go public and raise more than $123 billion, and more than 160 of these “blank check firms” complete mergers with or acquisitions of private companies in “de-SPAC” transactions. With the continued popularity of SPACs, however, come litigation risks and a need for market participants contemplating SPAC transactions to be aware of noteworthy private litigation trends—from assertions of breach of duty based upon conflicts of interest to securities law violations arising from alleged deficient disclosures—as well as recent Securities and Exchange Commission (SEC) guidance and the potential for increased regulatory enforcement activity around SPACs.
Partner Joanna Christoforou and associate Savas Manoussakis wrote an article for Law360 about the New Security and Investment Act which comes into effect on January 4, 2022. They analyzed the act and discussed its impact on transactions that may involve potential national security concerns.
A group of hospitality policyholders failed in their attempt to obtain cover under a business interruption policy as it was determined, in an ad hoc arbitration, that the UK central government did not constitute “a competent local authority.”
The United States has a long history of reviewing cross-border investment (FDI) to assess the national security implications of these types of transactions. With more than 20,000 to 40,000 FDIs a year, most transactions, however, occur outside the purview of US government review.
A settlement has been reached in Shergill v. Mayorkas, a federal lawsuit seeking to compel US Citizenship and Immigration Services to follow its regulations by automatically granting work permit extensions to L-2 and H-4 nonimmigrant visa holders. Under the settlement agreement, the agency has agreed to change its policies regarding employment authorization documents for certain H-4 and L-2 nonimmigrant visa holders.
The Hong Kong Stock Exchange recently published a consultation paper seeking market feedback on its proposed rule amendments relating to share schemes of Hong Kong–listed issuers and their subsidiaries. The consultation paper, published on 29 October 2021, is now open for public comments until 31 December 2021, and the proposed changes are significant.
The Division of Examinations staff of the US Securities and Exchange Commission (SEC) published a risk alert on October 26, 2021, titled “Observations from Examinations in the Registered Investment Company Initiatives,” which summarized the observations of the staff coming out of a series of examinations from 2018 and 2019 that focused on mutual funds and exchange-traded funds (ETFs) and, specifically, on certain compliance areas that may impact retail investors.
Are you a customer negotiating a services agreement that will grant you access to use certain technology? Have you read through the agreement or accompanying links to determine if you need to adhere to an acceptable use policy (AUP) for such technology? In this post, we’ll discuss some of the items a customer should consider when reviewing AUPs within services agreements.
A recent BASF jury verdict highlights the breadth of the Sherman and Clayton Acts—particularly the remedies available to plaintiffs involved in the manufacturing of goods—if supply agreements are found to hinder marketplace competition. The verdict serves as an important reminder for automotive and other stakeholders to take care in drafting supply agreements to ensure that these contracts do not implicate—or violate—federal antitrust laws.
FDA recently entered into domestic mutual reliance (DMR) agreements with the states of California, Florida, Utah, and Wisconsin to help ensure the safety of domestic food production and distribution systems. FDA’s goal is to coordinate efforts with these states to help decrease human foodborne illness outbreaks, avoid duplication of regulatory oversight, and increase public health protection. Erik Mettler, assistant commissioner for partnerships and policy in FDA’s Office of Regulatory Affairs, noted that the agency is using these partnerships to “improve industry compliance with applicable food safety requirements.”
The Biden-Harris administration plans to lift travel restrictions on visitors from most European countries, including the United Kingdom and Ireland, and other countries that have been in place since the start of the coronavirus pandemic.
The Hong Kong Stock Exchange (HKEx) has issued the much-anticipated consultation paper on creating a listing regime for special purpose acquisition companies (SPACs).
Severe weather events are causing catastrophic damage and business interruption losses to businesses each year around the world. The energy industry is particularly vulnerable, including entities in the exploration, development, transportation, generation, and/or distribution business. Leveraging all available insurance coverage and pursuing claims are critical first steps in recovery.
In this conversation with partner Steve Cohen and Linda Wellbrock, the CEO and founder of Leading Women Entrepreneurs (LWE) and named a Force for Change (FFC), a variety of venture capital and emerging business topics is covered. Included among the discussion was how COVID impacted the start-up landscape which is known for being a disruptive market, and how women and people of color are making advances in the market and securing additional capital.
The Singapore Exchange has launched special purpose acquisition company (SPAC) listings in Singapore with a new framework on governing SPACs.
It is a common misconception, particularly among multinational businesses, that the European design protection system is nearly identical to the design patent system in the United States.
The European Commission and the European External Action Service issued Guidance on Due Diligence for EU Businesses to Address the Risk of Forced Labour in Their Operations and Supply Chains (Guidance) on 12 July as a guide for European companies to implement effective human rights due diligence practices.
A recent US Securities and Exchange Commission (SEC) settled enforcement action that found that a hedge fund acted as an unregistered “dealer” has blurred the traditional line between dealers and traders.
The US Securities and Exchange Commission (SEC) approved new disclosure rules on August 6 regarding board member diversity of Nasdaq-listed companies. Nasdaq’s new rules require most companies to tell shareholders how many of their board members are diverse in terms of race, gender, and LGBTQ+ status and, if they do not have at least two diverse directors, they must explain to shareholders why by August 2022.
The year 2020 saw a wave of healthcare activity in the Asia Pacific region. Buyouts rose to a record high of 156 deals in 2020, up from 68 in 2019. Disclosed value reached a new peak of $16.9 billion compared with $11 billion the year earlier . This is attributed to macroeconomic trends such as aging populations and increasingly affordable healthcare, and favorable government policies encouraging local manufacturing and development of healthcare products.
The UK government announced on 20 July that the National Security and Investment Act will enter into force on 4 January 2022. This act introduces mandatory filings for certain investments raising national security concerns, grants the UK government extensive call-in powers for up to five years for completed transactions, and has retrospective application for transactions closing between 12 November 2020 and 3 January 2022.
The recent reform of the German transparency register affects almost all companies in Germany and greatly expands the reporting obligations for German entities.
The Federal Trade Commission (FTC) recently issued a final rule that marks a major shift in the regulatory landscape for labeling that has already begun to impact other regulatory bodies—namely, the US Department of Agriculture (USDA). The FTC’s new rule adds teeth to its longtime policy to prevent deceptive “Made in USA” (MUSA) claims, codifies its informal 1997 Enforcement Policy Statement on U.S. Origin Claims, and enables it to seek civil penalties of up to $43,280 for each violation of the rule.
Companies doing businesses in the European Union should note an important development that could introduce a duty of care for companies. On 10 March 2021, the EU Parliament approved an outline proposal for an EU Directive on Mandatory Human Rights, Environmental and Good Governance Due Diligence (Directive).
With reports of a continued increase in the volume of mergers and acquisitions—a growth of nearly 160% in just the first half of 2021 alone—and no signs of a slowdown, it remains important for companies and investors to consider the scope of IP diligence appropriate for their targets, and how representation and warranty insurance (RWI) may affect the diligence effort.
The rule changes mostly reflect those proposed in the April 2021 consultation. The key change is that the new regime will apply to SPACs which raise a minimum amount of £100 million at IPO (as opposed to a £200 million threshold proposed in the original consultation).
A recent judgment by the High Court of England and Wales in the case of Jamp Pharma Corp v. Unichem Laboratories Limited has held that agreements reached as part of contract negotiations for contracts governed by English law may be impliedly “subject to contract” without the need to expressly state that the discussions and documents are “subject to contract” prior to a formal executed agreement.
On July 7, 2021, the Japan Ministry of Finance (MOF) published an updated list of classifications of companies listed on Japanese exchanges requiring prior notifications of inward direct investment under the Foreign Exchange and Foreign Trade Act (FEFTA).
The UK’s Financial Conduct Authority (FCA) published its 2021/22 Business Plan on July 15, setting out its future role, priorities, and how it intends to deliver them. The FCA’s website contains a summary and full copy of the business plan.
The proposed guidance also identifies principles that are applicable to each stage of the third-party risk management life cycle, including: (1) developing a plan that outlines the banking organization’s strategy, identifies the inherent risks of the activity with the third party, and details how the banking organization will identify, assess, select, and oversee the third party; (2) performing proper due diligence in selecting a third party; (3) negotiating written contracts that articulate the rights and responsibilities of all parties; (4) having the board of directors and management oversee the banking organization’s risk management processes, maintaining documentation and reporting for oversight accountability, and engaging in independent reviews; (5) conducting ongoing monitoring of the third party’s activities and performance; and (6) developing contingency plans for terminating the relationship in an effective manner. The proposed guidance provides extensive details on all the above identified principles.
Changes to complex commercial contracts are inevitable. These contracts, such as large outsourcing agreements, typically include a master services agreement (MSA) and a high number of exhibits and attachments describing the scope, performance standards, financials, and other contractual requirements in detail. Some deals can end up containing over 50–75 documents (or more!) in total. Given their strategic importance, these agreements often require numerous amendments as the relationship evolves over time and changes need to be formally documented.
The UK Financial Conduct Authority (FCA) announced on July 9 that, while changes to the scope of the UK commodity position limits regime are being consulted on, it will not take enforcement action against firms that breach position limits on cash-settled commodity derivative contracts unless the underlying is an agricultural commodity. However, the FCA will keep its stance under review, and reconsider if there are indications of market abuse.
The still evolving US sanctions (as well as the EU and now also separate UK sanctions) continue to challenge Russia-related business. The sanctions frameworks are complex, changing, and, at times, inconsistent as well as overlapping. Navigating this complex global framework is made even more difficult by the ongoing unpredictable and reactionary geopolitical environment as the Biden Administration gets underway.
The United Kingdom’s Department for Digital, Culture, Media & Sport (DCMS) is requesting views on supply chain cybersecurity, which it will look to incorporate into its new National Cyber Security Strategy.
Congress has enacted and President Joseph Biden has signed a joint resolution of disapproval under the Congressional Review Act (CRA) of the Office of the Comptroller of the Currency’s (OCC’s) “true lender” rule, which, as we previously discussed, had provided that a national bank is as a matter of law the lender on any loan for which it is the named lender or for which it provides the loan funding.
Our healthcare team recently launched a publication series highlighting the global impact of COVID-19 on healthcare transactions. Around the globe, the healthcare industry has faced similar issues from the unprecedented pandemic, prioritizing their operational response to COVID-19. Now, as countries begin to reopen, healthcare entities may refocus on planning for long-term transformation of their business models. In this series, we will explore how the pandemic impacted healthcare transactions in specific regions and what we can expect in a post-pandemic world.
After a sluggish year in 2020 for mergers and acquisitions among hospitals and health systems, 2021 has shown renewed vigor and is poised for considerable transactional activity.
Last year was a record-breaking one for capital raising in life sciences, and 2021’s first quarter was robust for special purpose acquisition company (SPAC) transactions. Now, after a second-quarter SPAC and initial public offering (IPO) slowdown, the outlook for summer SPACs has rebounded just in time for the Morgan Lewis Global Public Academy program, Going Public Through a SPAC: Current Issues for SPAC Sponsors and Private Companies 2021. Our panelists will discuss some of the most important legal issues for companies considering going public through a SPAC and for SPACs seeking an acquisition target. Topics covered will include the use of private investments in public equity (PIPEs), obtaining shareholder approval for a merger, and the required SEC filings and review process.
The new executive order continues the policy of prohibiting US persons’ transactions in the publicly traded securities of select Chinese companies, but expands the scope to include both Chinese companies that operate or have operated in the defense and related materiel sector and those in the surveillance technology sector of the economy of the People's Republic of China.
The UK National Security and Investment Act 2021 (NSI Act) received royal assent on 29 April 2021. Expected to come into force in late 2021, the NSI Act will introduce a standalone UK foreign direct investment and national security screening regime, replacing the current regime that links national security screening with UK merger control.
The State of New York has enacted a new law that should ease the transition away from US dollar LIBOR for legacy financial contracts that are governed by New York law but do not contain modern benchmark fallback provisions. A similar federal law is in the works, which if passed would apply nationwide.
The Financial Services Agency of Japan (FSA) recently submitted a bill to the National Diet of Japan including certain amendments to finance-related laws for purposes of strengthening Japan’s financial system and financial stability in response to social and economic changes caused by the COVID-19 pandemic. Among these measures, this LawFlash addresses the proposed amendments to the Financial Instruments and Exchange Act (FIEA) for purposes of promoting foreign asset managers’ entry into the Japanese market.
The UK Prudential Regulation Authority (PRA) published a policy statement (PS7/21) and a supervisory statement (SS2/21) on clarifying and modernizing regulatory expectations of outsourcing and third-party risk management on March 29. The expectations in PS7/21 and SS2/21 are relevant to banks, PRA-designated investment firms, insurers, and branches of overseas banks and insurers and apply not just to “outsourcing” but also non-outsourcing material or high-risk service arrangements. The expectations apply at a legal entity level rather than at a group level (save for expectations on intragroup arrangements).
The Singapore Exchange has launched a consultation on proposed rules governing special purpose acquisition companies.
China recently amended its primary regulation governing medical devices, the Regulation on Supervision and Administration of Medical Devices (2021 RSAMD), which will replace its previous 2014 version and become effective on June 1, 2021. While the 2021 RSAMD largely follows the structure of the 2014 version, it does introduce a few important changes of which medtech companies interested in marketing in China should be aware.
The president of the Republic of Kazakhstan signed Law No. 399-VI, On Amendments into Certain Labour-Related Legislative Acts of the Republic of Kazakhstan (the Amendment Law), on January 2, 2021. The Amendment Law entered into force on January 16 and amended a number of legislative acts of the Republic of Kazakhstan, including the Civil Code, the Budget Code, and the Entrepreneurial Code as well as the Law of the Republic of Kazakhstan on Public-Private Partnership (PPP), No. 379-V, dated October 31, 2015 (the PPP Law). This LawFlash summarizes the most important new elements introduced into the PPP Law through the Amendment Law.
With special purpose acquisition companies increasingly being used in initial public offerings and the commercial insurance market continuing to harden, captive insurance could be a solution for offering directors and officers protection against increased shareholder scrutiny and resulting derivative lawsuits.
With special purpose acquisition companies increasingly being used in initial public offerings and the commercial insurance market continuing to harden, captive insurance could be a solution for offering directors and officers protection against increased shareholder scrutiny and resulting derivative lawsuits.
France’s highest Court (Cour de Cassation) recently ruled that an acquiring entity, in this case Iron Mountain, could be found criminally liable for violations committed by the target, here Recall France, before the transaction. The November 25, 2020 decision, which reversed French case law, foreshadows serious concerns for future acquirers in M&A transactions.
The Financial Market Integrity Strengthening Act includes a large number of innovations aimed at strengthening confidence in the German financial market by placing more comprehensive obligations on auditors when auditing companies of public interest. In addition to optimizing balance sheet control and further regulating the auditing of financial statements, the innovations also affect corporate governance at companies.
All initial public offerings (IPOs) must be paperless from July 5, 2021 and documents put on display by issuers to support listings and transactions must be made available online from October 4, 2021.
Mexico’s Federal Consumer Protection Agency (Procuraduría Federal del Consumidor (PROFECO)) on February 26 announced its new voluntary Ecommerce Ethics Code (Código de Ética en Materia de Comercio Electrónico), which may be adopted by entities doing online business in Mexico. Although the adoption of the Ecommerce Ethics Code is voluntary, it signals the authority’s baseline expectation for market participants, and sets forth the parameters and guidelines for suppliers of goods and services that operate through digital platforms or virtual salesrooms.
The Biden administration has vowed to invoke the Defense Production Act (DPA) to increase domestic production of essential supplies needed to respond to the COVID-19 pandemic. In this Insight, we address key features of the DPA, guidance for companies that may receive a rated order, financing incentives offered by the DPA, and how we anticipate the Biden administration will use the DPA over the next year.
The German Act on the Further Development of the Restructuring and Insolvency Law (Sanierungs- und Insolvenzrechtsfortentwicklungsgesetz – SanInsFoG) took effect on January 1, 2021, transforming the European Restructuring Directive of June 20, 2019 ((EU) 2019/1023) and introducing a self-administrated restructuring option outside the standard insolvency proceeding.
The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) published final rules on January 15, 2021, implementing the sanctions put in place by Executive Order 13936 (EO 13936) and the Hong Kong Autonomy Act of 2020 (the Act or HKAA). In EO 13936, then President Donald Trump found that Hong Kong was no longer sufficiently autonomous to justify differential treatment in relation to the People’s Republic of China (PRC), largely in response to the imposition of China’s national security legislation on Hong Kong by the PRC government. This finding and the HKAA authorize the Department of the Treasury to issue new regulations to implement the change in status.
Recent sanctions imposed by the European Union, United Kingdom, and the United States on Turkey and certain Turkish persons will be of interest to European and American investors in Turkey’s defense and energy sectors. The following update contains a summary of each regime.
When negotiating a service agreement there are many terms and conditions to be mindful of, but it’s important to review and consider the acceptance requirements.
The Consumer Financial Protection Bureau (Bureau or CFPB) on January 13 issued a Statement Regarding the Provision of Financial Products and Services to Consumers with Limited English Proficiency (Statement), which is intended to provide compliance principles and guidelines to inform and assist financial institutions in their decisionmaking related to serving limited English proficiency (LEP) consumers in non-English languages.
Recent proposed changes to the Singapore Electronic Transactions Act would allow for the digitalization of cross-border trade documents and other important legal documents.
China’s Ministry of Commerce (MOFCOM) published the Rules on Counteracting Unjustified Extraterritorial Application of Foreign Legislation and Other Measures (the Blocking Statutes) on January 9. The rules, which consist of only 16 articles, became effective upon publication.
The Japanese government announced on January 13 that it has added seven prefectures—Osaka, Kyoto, Hyogo, Aichi, Gifu, Tochigi, and Fukuoka—as areas subject to the Second Declaration of a State of Emergency (SDSE) from January 14, 2021. The decision expands the number of areas subject to the SDSE to eleven prefectures. In the current plan, this measure will be continued until February 7, 2021.
New changes to UAE corporate and foreign ownership laws will abolish longstanding foreign ownership restrictions and remove substantial barriers to doing business in the UAE.
Despite the challenges of an unprecedented global pandemic, cartel enforcement activity in 2020 increased in many leading enforcement jurisdictions. Corporate fines, for example, more than doubled from 2019 in the United States, Mexico, South Korea, and Taiwan.
Partner William Yonge spoke to IFLR about the Sustainable Finance Disclosure Regulation
Partners Christopher Paridon and Kristin Lee spoke to Global Banking Regulation Review for a three-part article series looking at the 2023 banking regulatory landscape—the third installment focusing on regional regulation issues.
Partner Daniel Chia spoke to IFLR about restructuring and insolvency trends to watch out for in Asia in 2023.
In the first installment of a two-article series, Private Equity Law Report provided an overview of a recent Private Fund Investors Roundtable Webinar Series the firm hosted.
Partner Benjamin Wills, co-leader of the firm’s Global Mergers and Acquisitions practice, spoke to Law360 about the energy industry deal landscape in 2022.
Partners Rebecca Kelly and associate Christopher Brinley co-authored the United Arab Emirates (UAE) chapter for the Global Legal Insights’ Bribery & Corruption Law and Regulations 2023 guide, offering an overview of the law and enforcement regime in the United Arab Emirates.
Partner Leonidas Theodosiou spoke to IFLR about the United Kingdom’s Digital Markets, Competition and Consumer Bill and its comparisons with the European Union’s Digital Markets Act.
Partner Steven Lightstone spoke to International Financing Review about reforms announced by the European Union to its securitization regime. Steven notes that the proposals are “consistent with international standards.”
Partner Steven Lightstone spoke to GlobalCapital about the United Kingdom’s recently announced Edinburgh Reforms, which concern financial services.
Partner Merryn Craske spoke to GlobalCapital about the divergence in the regulation of securitization between the European Union and the United Kingdom.
Partner Merryn Craske spoke to GlobalCapital about the outlook for the European securitisation market in 2023.
Lawyers from our London practice have contributed to Lexology’s Getting the Deal Through (GTDT) – Distressed M&A 2023 guide. The UK chapter features insight from lawyers in our corporate, finance, tax, and antitrust practices.
Partners Chris Warren-Smith and Daniel Chia spoke to IFLR about recent rulings in Singapore and the United Kingdom on the recognition of non-fungible tokens (NFTs) as property.
Partners Carl Valenstein and David Plotinsky spoke to Asian Legal Business about the new set of criteria on international investment reviews introduced by US President Joseph Biden and strategies for companies looking to invest in the United States.
Partner David Plotinsky is quoted by Foreign Investment Watch in an article about how much awareness US institutional investors and companies have of potential outbound investment reviews.
Partners Carl Valenstein and David Plotinsky spoke to Asia Business Law Journal about the strategies for companies looking to invest in the United States.
Partners Carl Valenstein and David Plotinsky discuss Committee on Foreign Investment in the United States (CFIUS) considerations for investors in the United States with Lexology PRO. They provide an overview of CFIUS reforms and Foreign Investment Risk Review Modernization Act (FIRRMA) regulations, mandatory filing requirements, and strategies for addressing CFIUS concerns.
Partner Giovanna Cinelli discussed export controls on advanced computing and semiconductor equipment destined for China recently announced by the US government with Export Compliance Daily.
Partner Merryn Craske spoke to GlobalCapital about the amendments to the disclosure templates for multi-jurisdictional securitization deals and private securitizations outlined in the EU Securitisation Regulation.
Partner Wai Ming Yap and senior associate Gina Ng spoke to IFLR about the Monetary Authority of Singapore’s consultation on its regulatory approach to stablecoin-related issuance and intermediation.
Partner Grigory Marinichev was quoted in a Reuters article about complications global investors and banks have had converting depositary receipts of Russian companies into ordinary shares in compliance with a new Russian law.
Partner Sabine Smith-Vidal authored an article for SHRM about the measure implemented by France in the French Act No. 2021-1774 of December 24, 2021—which created an obligation of balanced representation between women and men among senior executives and board members. She discusses the requirement of the act and its implications for senior managers and management bodies.
Partner Rebecca Kelly authored a note for the board for Thomson Reuters Practical Law about key points regarding the applicable anti-bribery and corruption regime in the United Arab Emirates. She discusses offenses, penalties, and implications for companies, boards, and management.
Partner Daniel Chia and senior associate Jonathan Tang authored an article for IFLR about the comprehensive update of insolvency laws in Singapore and its attractiveness for companies seeking debtor-led reorganizations.
Partner Merryn Craske spoke to GlobalCapital about the United Kingdom (UK) and European Union’s (EU) securitization regulations.
Hedge Fund Law Report released the second article in a two-part series analyzing the US Securities and Exchange Commission’s (SEC’s) second set of proposed amendments to Form PF—in conjunction with the US Commodity Futures Trading Commission (CFTC)—released on August 10, 2022.
Partner David Plotinsky, former acting chief and principal deputy chief of the Foreign Investment Review Section at the US Department of Justice (DOJ), was quoted in a GCR article focused on deals that fail to address concerns raised by the Committee on Foreign Investment in the United States (CFIUS).
Fundraising remains competitive and ongoing, despite the record amount of dry powder sitting in the coffers of private equity (PE) sponsors.
Partner David Plotinsky was quoted in a GCR feature article discussing how policy considerations, rather than legal issues, lead to the most complicated US-based foreign investment control matters.
Partner Shannon Donnelly and associates Yvette Allen and Carina Bryk authored an article for International Employment Lawyer about the United Kingdom’s new Scale-up visa route launched on August 22, 2022. They discuss the requirements for sponsors and applicants and the advantages of using the Scale-up visa.
Partner Merryn Craske and associate Elif Eke authored an article for Law360 reviewing the United Kingdom’s proposal to extend the EU securitisation rules. They provide a background of the EU Securitisation Regulation and discuss the proposed extension.
Partner Kenneth Nunnenkamp was featured in the “Ten Minutes On” Foreign Investment Watch video series discussing his and partner Giovanna Cinelli’s report, “Analysis: It’s Time to Create ‘The Commission on Foreign Investment and National Security.”
Partners Edwin Luk, Billy Wong, June Chan, and Keith Cheung authored an article for Thomson Reuters Regulatory Intelligence about the effect of new listing rules on the Hong Kong Stock Exchange. They discuss share schemes, disclosure requirements, share grants, and the voting rights of unvested scheme shares.
Partners William Yonge, Alishia Sullivan, and Kate Habershon were quoted by Private Equity Law Report in relation to UK and EU regulatory updates and trends in Shari’a-compliant funds in the Middle East. William said, “[T]he U.K. did not onshore the E.U. [Sustainable Finance Disclosures Regulation] into U.K. law as part of Brexit, and it is currently developing its own sustainability disclosure regime.”
Partner Merryn Craske spoke to International Financing Review about the United Kingdom’s proposed extension of the recognition of simple, transparent, and standardised (STS) securitisations in the European Union and equivalence regime.
Partner Merryn Craske spoke to GlobalCapital about European reporting requirements for public and private transactions under the EU Securitization Regulation.
Foreign Investment Watch featured partner David Plotinsky for the publication’s “Ten Minutes On” video series.
Partner Julia Frost-Davies and other leading practitioners are profiled by Insider discussing the current state and future of bankruptcies and debt restructurings.
Partner Giovanna Cinelli was quoted in a piece from The Capitol Forum regarding the potential for review by the Committee on Foreign Investment in the United States (CFIUS) of SD Biosensor’s and SJL Partners’ proposed acquisition of Meridian Bioscience.
Given its existing limitations, the Committee on Foreign Investment in the United States is ready for its next evolution—not a tweaking around the edges of an existing process that continues to perpetuate limitations to the flexibility and certainty essential to managing a range of interests, but a foundational shift from a “committee” to a statutorily established “commission” comparable to others operating at the federal level, such as the Federal Communications Commission, International Trade Commission, and US Securities and Exchange Commission.
Foreign Investment Watch previews an analysis authored by partners Giovanna Cinelli and Kenneth Nunnenkamp that proposes that national security reviews of foreign investments covered by the Committee on Foreign Investment in the United States (CFIUS) merit a full-on commission, not an ad-hoc committee.
Partner William Yonge spoke to Hedge Fund Law Report about the UK Financial Conduct Authority’s (FCA’s) recently issued portfolio letter to firms in the custody and funds services portfolio, which includes third-party custodians, fund depositaries, third-party fund administrators, and transfer agents.
In the final installment of a series by Hedge Fund Law Report on sanctions compliance, partner Giovanna Cinelli discusses the elements of effective sanctions compliance, highlighting the need for due diligence, among other insights and recommendations.
Partner Amanjit Fagura spoke to Salaam Gateway about Sharia-compliant environmental, social, and governance (ESG) investments in the Islamic finance industry.
Partners Frances Murphy and Joanna Christoforou and associate Michael Zymler authored an article for Global Competition Review about cartel enforcement action in the United Kingdom from March 2021 to March 2022.
Partner Merryn Craske spoke to IFLR about simple, transparent, and standardised (STS) securitization. “From the start, the authorities were strongly opposed to investors investing in instruments that they didn’t understand,” she said. “The idea was to introduce more reporting and more investor due diligence.”
Welcome to the 112th edition of our outside publication on developments in national competition laws released in Wirtschaft und Wettbewerb (WuW), a periodical for German and European competition law professionals published by Handelsblatt Fachmedien.
Partners Alishia Sullivan, Carol Tsuchida, Wai Ming Yap, and Alice Haung wrote an article for Thomson Reuters Regulatory Intelligence about digital asset regulations and trends for private funds in Asia and the Middle East.
Russia President Vladimir Putin signed the federal law, “On Amendments to the Federal Law ‘On Measures of Influence (Counteraction) on Unfriendly Actions of the United States of America and Other Foreign States,’” on May 1, substantially restricting the ability of Russian banks to disclose information to foreign regulators, in particular, under the US National Defense Authorization Act.
Partner Grigory Marinichev spoke to Frankfurter Allgemeine about the recent Russian law on mandatory delisting of Russian companies from foreign exchanges.
Partner Lance Dial was quoted in a Pensions & Investments article looking at the pace of new proposals coming out of the US Securities and Exchange Commission (SEC).
A recent PYMNTS.com article looks at China’s tech regulatory landscape, noting that the “decision by the Chinese authorities brings back the debate about how far it is necessary to go in regulating Big Tech companies to get more competition in the market and the unintended consequences of having additional rules.”
In this Bloomberg Law Insight, Morgan Lewis partner Giovanna Cinelli, leader of the firm’s international trade and national security practice, writes that reviews of foreign direct investment transactions by the Committee on Foreign Investment in the United States (CFIUS) are broader, deeper, and more inclusive in the current geopolitical environment.
Global Legal Group has published ICLG — Lending & Secured Finance 2022 — a guide providing corporate counsel and international practitioners with a comprehensive worldwide legal analysis of the laws and regulations of lending and secured finance.
Morgan Lewis partner David Plotinsky, former acting chief and principal deputy chief of the US Department of Justice’s Foreign Investment Review Section, was interviewed by “In-House Warrior” host Richard Levick for this Corporate Counsel Business Journal podcast about trends in the Committee on Foreign Investment in the United States and the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector.
Morgan Lewis partner Rebecca Kelly spoke with Global Investigations Review about the recently introduced whistleblowing regime in the United Arab Emirates, stating that “the [Financial Action Task Force] had particular concerns about the lack of [anti-money laundering] prosecutions in the country and so the protection of whistleblowers, when it comes to employees highlighting wrongdoing within their companies, is essential in order to assist with securing these types of prosecutions in the future.”
In February, the US Securities and Exchange Commission (SEC) released proposed private fund reforms (the proposal) that could potentially alter the future of the private funds industry.
The Financial Industry Regulatory Authority (FINRA) is accepting public comments on a proposed rule that could drastically change how new exchange-traded funds (ETFs) are treated and how easily retail investors can trade them - a move that is drawing fire from some sectors of the industry.
Utility Dive spoke with partner Neeraj Arora about how the supply chain constraints are expected to affect the energy storage industry.
Partner Giovanna Cinelli was quoted in an Export Compliance Manager article highlighting key steps for companies complying with rapidly escalating sanctions.
In a Law360 Expert Analysis, partner Peter Neger and associate Bryan Woll discuss how the operations in Ukraine—or Ukraine-related sanctions—might impact companies and their counterparties’ obligations under agreements that require performance by or with sanctioned entities.
Partner Grigory Marinichev spoke to Bloomberg about Type C accounts in relation to Russia’s debt settlement.
Partners Moto Araki, Todd Liao, Joo Khin Ng, Billy Wong, and Nancy Yamaguchi wrote an article for Pharma Focus Asia discussing the impact of COVID-19 on the Asian life sciences sector, and look more closely at current M&A trends in China, Japan, Hong Kong and Singapore markets.
Partner Bruce Johnston spoke to GlobalCapital about the possible implications of a Russian foreign debt moratorium.
Partner Bruce Johnston spoke to The Wall Street Journal about the effects of the UK’s sanctions.
Partner David Plotinsky, former acting chief of the US Department of Justice’s (DOJ’s) Foreign Investment Review Section (FIRS), was profiled by Foreign Investment Watch following his arrival at Morgan Lewis.
Partners Rebecca Kelly and Bill Nash wrote an article for The Oath examining some of the regulatory trends and sectors that will shape the Middle East over the next 12 months.
This Q&A provides a high-level overview of retail investment funds in the Russian Federation. Areas covered include: a market overview; a description of how interests in funds are accessed and priced; fund vehicles and structures; key statutes, regulations, and rules governing funds; applicable local or state laws; authorisation requirements for retail funds; rules governing managers and operators; marketing; the assets portfolio; investment and borrowing restrictions; redemption of interests; reporting requirements; tax treatment; and reform.
Partner Christopher Dlutowski spoke with Private Equity Law Report about single-investor funds (SIFs) and why investors find the flexibility of SIF opportunities so appealing.
In the first article of a two-part series, Private Equity Law Report covers insights on secondary transactions and co‑investments shared during Morgan Lewis’s webinar “State of the Private Funds Market,” hosted during the 2021 Annual Private Fund Investors Roundtable.
Partner John McGuire was interviewed by BoardIQ for an article about broad compensation structures and meeting fees. “Getting members to make it to board meetings may have been a motivation decades ago, but these days it is rare directors miss one,” John said, adding that “[I]’m old enough to remember when you had concerns about people attending meetings.”
GCR featured findings from Morgan Lewis’s 2021 Global Cartel Enforcement Report, which noted that global cartel fines increased by 229% last year, while the United States experienced a significant drop in penalties.
Partner Andrew Gallo, deputy leader of the firm’s bankruptcy and restructuring practice, spoke to Daily Business Review about national trends for bankruptcy filings and litigation in 2022.
Partners Rebecca Kelly and Bill Nash spoke to Law.com about regulatory investigations and investments across the Middle East.
Partner Howard Kenny spoke with Private Equity International about current trends in the special purpose acquisition company (SPAC) market. Howard shared that today’s deals are often done on a smaller scale and sometimes include stricter time constraints.
Morgan Lewis partner Rebecca Kelly and associate Laura Jane Shorthall co-authored the United Arab Emirates (UAE) chapter for the Global Legal Insights Bribery & Corruption 2021 guide, offering an overview of the law and enforcement regime in the UAE.
In the first of a two-part article, Morgan Lewis partner Joseph Zargari speaks with Private Equity Law Report about the role placement agents play in fundraising; what type of placement agents are used by sponsors; and compliance concerns that sponsors should consider when engaging and working with a placement agent in both the US and non-US jurisdictions.
Partner Maurice Hoo spoke with the Asian Venture Capital Journal about the increase in listing applications from companies with the Hong Kong Stock Exchange. “If the most recent funding round was at the end of last year or beginning of this year, before the recent issues, even if the company listed today, would it get the valuation it was expecting? That is the major concern,” says Maurice, who advises private equity and venture capital investors.
During the ACA Group’s Fall 2021 Virtual Conference, partner Steven Stone discussed FINRA’s recent issuance of Regulatory Notice 20 21 (RN 20 21). The Notice requires certain internal rates of return for unrealized investments to be calculated in accordance with the CFA Institute’s Global Investment Performance Standards (GIPS).
International Comparative Legal Guide (ICLG) has published the Class and Group Actions 2022. This guide provides corporate counsel and international practitioners with a comprehensive worldwide legal analysis of the laws and regulations class and group actions.
Partner John Pease spoke with CFO Dive about the Department of Justice’s recently announced Corporate Crime Advisory Group, which will increase resources against corporate crime and focus on recidivism by considering all of a company’s past criminal, civil, or regulatory infractions when looking at a prosecution. John said that while the move appears to target bad corporate cultures, some business could feel like self-reporting will “open a can of worms.”
Partner Steven Stone provided insight into the private equity industry as a panelist during the ACA Group’s Fall 2021 Virtual Conference.
In the second article of a two-part series, partner Joe Zargari discussed the legal structure of a secondaries fund, noting “an LP Stakes Fund is very diversified, so the risk is spread out across many different assets.” In contrast, he noted that a “GP Led Fund is far more concentrated.”
In its latest toolbox memo, the Standards Board for Alternative Investments covers indemnification and exculpation provisions in private fund governing documents. In the first article of a two-part Private Equity Law Report series, partner Christopher Dlutowski discusses key issues raised in the memo and associated market practice on indemnification rights.
In the first article of a two-part series, partner Joe Zargari discusses which types of managers are considering expansion into secondaries and why. “Many large PE shops without secondaries teams are exploring, building, or acquiring a secondaries platform. Very large PE shops tend to acquire existing secondaries platforms rather than build internal teams,” Joe said.
Morgan Lewis recently assisted the U.S.-U.A.E. Business council, of which Morgan Lewis is a Founding Member, to update its guide to doing business in the United Arab Emirates (UAE).
Partner David Glazer, who was named a Dealmaker of the Year by New Jersey Law Journal for having “left an indelible mark on the legal community in New Jersey and beyond through their unwavering dedication to the profession,” was featured in a Q&A by the publication.
Lesli Ligorner discusses China’s Blocking Statute with Lexology PRO. The Blocking Statute authorizes government entities in China to take substantive measures, including issuing prohibition orders declaring foreign sanctions unenforceable, penalizing Chinese persons for violating the prohibition orders, and allowing Chinese persons to seek damages from entities that comply with the foreign sanctions.
Welcome to the one hundred and ninth edition of our outside publication on developments in national competition laws released in Wirtschaft und Wettbewerb (WuW), a periodical for German and European competition law professionals published by Handelsblatt Fachmedien.
Partner Shannon Donnelly and associate Jennifer Connolly authored an article for Law in Sport discussing the UK immigration landscape for the sports industry. With more events taking place within the context of restricted travel, the article provides key considerations for sports professionals and those who work in the industry.
In this Law360 article, partners Bernard Lui and Vanessa Ng discuss new legal considerations for participants in healthcare mergers and acquisitions with entities in Singapore and throughout the Asia-Pacific region as the COVID-19 pandemic continues.
Tsugumichi Watanabe, Mitsuyoshi Saito, and Masaki Ichimura contributed the discussion of attorney-client privilege in Japan in the most recent update of the widely used handbook, International Corporate Practice: A Practitioner’s Guide to Global Success, published by Practicing Law Institute (PLI).
Partner Chris Dlutowski spoke with FundFire for an article on a growing interest among hedge funds to invest in private companies leveraging a variety of options. The article addresses the questions this may be raising among the investor community.
Partner Giovanna Cinelli, who leads the firm’s international trade and national security practice, told World ECR she has seen no slowdown in Chinese investments in US technology companies despite countries’ fortification of investment regulations.
Morgan Lewis partner and co-leader of the firm’s SPAC task force Alec Dawson spoke with The Deal for its “Drinks with The Deal” podcast.
Partners Daniel Nelson, Kate Habershon, and Kathryn Hambrick and associates Meghan McCarthy, Alexios Hadji, and Grace Tan co-authored an article for the Journal of Investment Compliance regarding tax-related issues in the private wealth fund investment area. The article dives into regional tax considerations for sovereign wealth funds that are looking to ramp up investments post-pandemic.
Leonidas Theodosiou was quoted in a Global Competition Review article regarding the United Kingdom’s new Subsidy Control Bill that was introduced in Parliament.
Fund Management 2021, published by Lexology’s Getting The Deal Through (GTDT), gives a high level overview of the key considerations for the fund management industry and predictions for the year ahead.
Partners Mark Geday and Edwin Luk and of counsel Jeffrey Letalien co-authored an article for Law360 looking at current trends across the international special purpose acquisition company (SPAC) market.
Motonori Araki co-authored "The Impact of the Rules on Counteracting Unjustified Extra-territorial Application of Foreign Legislation and Other Measures (Order of the Ministry of Commerce of the People’s Republic of China 2021 No.1) Japanese companies at the mercy of trade conflict between US and PRC" in Japanese for the Journal of the Japanese Institute of International Business Law.
Morgan Lewis partner Todd Liao authored an article for Medtech Insight about China’s amended regulation governing medical devices. The update of the Regulation on Supervision and Administration of Medical Devices, which came into effect on 1 June 2021, introduces important changes that medtech companies should be aware of.
London-based partners Georgia Quenby and Victoria Thompson consider how the new Restructuring Plan under English law interacts with intercreditor agreements which have voting restrictions and other contractual prohibitions on creditor actions.
Morgan Lewis partner Mark Geday authored an article for IFLR looking at current deal making trends and considerations in the context of a challenging market.
Morgan Lewis partner Jeffrey Raskin was quoted in Business Insurance in an article about how insurance policies can protect special purpose acquisition companies (SPACs).
Partner Sandra Vrejan spoke with Bloomberg Law about a shift from the Small Business Administration regarding bankrupt companies’ eligibility for Paycheck Protection Program (PPP) loans. In the piece, Sandra noted that the guidance doesn’t address a key issue—whether bankrupt companies are eligible for PPP loans. “At the end of the day, the thumbnail conclusion is that it hasn’t changed all that much,” she said.
Morgan Lewis partner Jeffrey Raskin and associate Lauren Burke authored an article for Law360 about how captive insurance policies can protect special purpose acquisition companies (SPACs) from lawsuits and scrutiny from shareholders.
Partners Rob Mailer and Oli Rochman and associate Funke Omisore authored a column for Private Equity International which provides practical and commercial considerations for first-time fund managers.
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