This year’s IFLR Asia Capital Markets Forum
will bring together industry experts, private practice
practitioners and leading counsel to explore the latest
developments surrounding the capital markets legal landscape.
Key discussion points include: how digital is transforming the
capital markets, views on high yield, the opening up of the
Chinese capital markets, and Hong Kong’s biotech
here for more information on the forum, to view the agenda, or
to register to attend.
What do you spend most of your time doing at the
Virginie Duval, head of legal APAC regulatory advisory,
There is still a lot going on in the regulatory landscape.
Benchmark regulations, European Market Infrastructure
Regulation (EMIR) refit, senior manager accountability,
recovery and resolution regimes interactions are all keeping
regulatory and product teams very busy. In particular,
international banks are dealing with potential conflicting
regulations and increased regulatory attention on
Jackson Poon, general counsel, Liquefy
I spend most of my time staying up-to-date on the
regulations on security tokens and distributed ledger
technology across the world. It is important to understand
different regulators’ attitudes
towards security tokens since they will impact the
adoption of security tokens by financial institutions. I am
regularly meeting with asset owners, brokers, financial
institutions and consultants to explore collaborations with
Liquefy, as well as how they can use blockchain technology to
assist their existing businesses.
Mekail Ahmed, general counsel and head of structuring,
Gateway Private Markets
I am focused on developing Gateway’s platform
and product offering and executing on our strategy to simplify
access to private markets. At the operational end, this
involves defining and establishing a secure and efficient
institutional framework for sourcing and transacting private
Alec Tracy, COO and general counsel, Admiralty Harbour
As a new and growing firm, we are in a state of constant
change. My responsibilities as a member of the
firm’s senior management team take up a fair
amount of time as we develop and review our business plans and
In addition, from a legal and compliance perspective, we are
constantly re-evaluating our policies and processes. As
the COO and general counsel I play a key role in this regard
and since I do not come from a compliance background, this has
been a somewhat steep learning curve. I also play a role
in client management and advising the team on transaction
execution issues. This role is closer to what I did as a
private practice lawyer.
What are the biggest trends/themes in your
The reform of interbank offered rates (IBOR) and the
determination of reliable risk-free rates is a big theme at the
moment. It was triggered by the UK regulator’s
statement on the potential cessation of Libor, and now many
APAC jurisdictions are working on the determination of an
alternative rate for their local IBORs.
Currently, the process in which securities are bought, sold
and traded is manual and inefficient. Blockchain technology can
help to automate administrative processes to make security
transfers more efficient. The World Bank recently issued
the world's first bond created, allocated, transferred and
managed through its lifecycle using blockchain technology. We
believe that financial institutions will start adopting
blockchain technology given the benefits to transactions.
Companies are staying private longer, which leads to several
challenges affecting different participants within private
markets. These can include a lack of liquidity for shareholders
and administratively onerous and uncertain transaction
procedures for would-be investors.
Companies are also increasingly leveraging private markets
for fundraising and considering alternatives to traditional
sources of liquidity, such as direct listings over IPOs over
the longer term.
Slowing growth in China, the trade war with the US, and
other factors continue to put pressure on Chinese business and
the financing system. Since many companies do not generate
sufficient cash flows to repay their debts, refinancing is
critical and has become increasingly challenging for many
companies. Thoughtful structuring and seamless transaction
execution can be the difference between success and failure in
We are also seeing the development and refinement of onshore
restructuring practices, as regulators, banks and companies
come to grips with the reality of increasing default
rates. The rapid growth of the domestic Chinese bond
market over the past several years further complicates this
picture, as does the increasing use of onshore security for
offshore debt. Understanding onshore restructuring
practices as they evolve is important both in the restructuring
context and when structuring and executing new issues.
What do you think is the biggest challenge for Asian
capital markets in the next 12 months?
The potential cessation of Libor is a huge challenge for the
market. Dealing with legacy transactions and managing
clients’ expectations will require a lot of effort
from all financial institutions.
The biggest hurdle is educating regulators and financial
institutions that the benefits of tokenisation outweigh the
risks. The legal rights to the underlying asset is the same as
would apply to traditional assets, but with the benefit of
automating the administrative tasks through the use of smart
From an operational and documentation perspective,
standardising the sometimes fragmented and highly bespoke
approach commonly taken by companies will be an important
element to achieving scale.
In the China debt capital markets space, we believe that the
state of the economy, in light of the trade war and other
factors, will continue to create uncertainty and drive market
volatility. The impact of the reality of negative interest
rates in key developed economies like Germany and the
possibility that the US may follow, plus uncertainty about the
prospects for global growth, are also likely to pose challenges
as investors vacillate between risk-on and risk-off views.
In China, investor preferences for short-term debt over the
past several years have exacerbated refinancing risks, and
increasing default rates seems likely to make transactions more
challenging to complete. If liquidity in China is tightened,
this may also impact both default rates and the ability to
complete transactions, particularly if the ability of investors
to access leverage is curtailed.