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Slowing growth and a rising number of non-performing loans mean foreign creditors should carefully consider their restructuring options in Vietnam

The Telkomsel bankruptcy is the latest example of Indonesia’s creditor-friendly insolvency laws being put to questionable use

Philippos Aristotelous Following the bailout package agreed between the so-called troika of the EU, European Central Bank and IMF on one hand and the Cyprus government on the other, the two largest banks in Cyprus will be merged and considerably downsized. The Eurogroup and the Cyprus government consider that this solution is the best way forward for ensuring the overall viability and stability of the Cyprus financial system and the Cyprus economy.

Bond documentation has failed to keep pace with changing bondholder meeting practices. Draftsmen should take note of these common discrepancies

Important lessons have been learnt following a series of high-profile restructurings in Latin America. These are the issues would-be investors must consider

Alexei Bonamin The way in which a security interest is perfected may have a significant impact on the ability of the borrower to raise finance. A security perfected with the minimum delay and cost and the maximum of certainty and flexibility brings enormous advantages for borrowers and creditors. In 2011, the Brazilian congress approved a bill that, among other things, aimed to simplify the creation of security over securities and financial assets. The bill was signed into Law 12,543, but to produce its complete effects the law had to be regulated by the government.

Muharrem Küçük Mustafa Yigit Örnek When international banks and financial institutions finance a project or provide acquisition financing, they need to acknowledge certain restrictions under the Turkish Commercial Code No 6102 (TCC) in respect of security granted to secure such financing. For any project or acquisition financing, the borrower itself is able to provide a corporate guarantee to the lenders. But there is a concern if a subsidiary company is required to provide a corporate guarantee in respect of the obligations of its parent company. According to article 202 of the TCC, a parent company cannot cause any loss to its subsidiary. Although abuse of control by the parent company does not render the relevant transaction void, the parent company is obliged to compensate the losses of the subsidiary within the same financial year or provide a method for compensation within the same financial year. If the parent company fails to compensate, the other shareholders or creditors of the subsidiary are entitled to commence proceedings against the parent company and the directors of the parent company for compensation of losses. Article 202 also applies if either the parent or the subsidiary is incorporated in Turkey.

Freddy Karyadi Oene Marseille Indonesia's Capital Market and Financial Institutions Supervisory Agency (Bapepam-LK) has recently issued Decree No KEP-716/BL/2012 on Investor Protection Fund Organisers. It includes details on Organisers stipulated under the Decree's Appendix, Rule VI.A.5 on Investor Protection Fund Organisers. Decree 716 is a follow up to Decree 715, which establishes an Investor Protection Fund. In order to operate as an Organiser, a party must secure a business licence from Bapepam-LK. This can be obtained by submitting Form VI.A.5-1 along with the required documents as stated in Paragraph 13(a) of Decree 716. Bapepam-LK will either approve or deny the application.

Mian Muhammad Nazir Transfer of ownership and possession under certain Shariah nominate contracts and structures are the cornerstone for the validity of the sale and purchase transactions. Principles of Shariah provide for specific requirements that must be satisfied to ensure validity and enforceability of the underlying sale contract. It has been observed that there may be certain instances where a sale, which is perfectly valid and enforceable under the principles of Shariah, may need to comply with additional requirements under the local laws of the relevant jurisdiction in order to qualify as a valid and enforceable transaction. The question is whether a sale transaction strictly entered into in accordance with the principles of Shariah will still be required to comply with the local laws for its validity under Shariah principles. The Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) seems to suggest that compliance with local laws in relation to transfer of ownership and possession is an integral part of a Shariah sale in respect of certain Shariah-compliant contracts and structures. To this extent, it is encouraging to note that for the modern application of Shariah nominate contracts and structures, compliance with local laws, in relation to transfer of ownership, possession and legal effects of the sale and purchase contract, is well recognised by Shariah scholars and the AAOIFI (which is a standard setting organisation). However, the more important question is what are the effects of non-compliance with the local law requirements on the Shariah compliance of underlying transactions in view of the AAOIFI's resolution, which obligates transfer of ownership in the sukuk assets to be in accordance with local law requirements.

Thomas A Humphreys Remmelt A Reigersman Late last year, House Ways and Means Committee chairman David Camp sent a letter to the House Committee on Financial Services (HFSC) outlining amendments to the Covered Bond Act (CBA) that significantly alter the tax treatment of covered bond pools segregated from the issuer's estate after an event of default. Covered bonds are debt obligations that are recourse either to the issuing entity or to an affiliated group to which the issuing entity belongs, or both. Upon an issuer default, covered bond holders also have recourse to a pool of collateral (known as the cover pool), separate from the issuer's other assets.