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Bankability issues could prove an important challenge to the Colombian government’s PPP push

The LMA’s revised intercreditor agreement has only gone so far in addressing mezzanine creditor concerns. Here’s how to negotiate around the shortfalls

Chinonyelum Uwazie The regulation of market abuse has for many years been the subject of discussions among financial market participants and scholars. It dominated discussions before the recent global financial crisis (see, for instance, Avgouleas, The Mechanics and Regulation of Market Abuse: A Legal and Economic Analysis Regulation, Oxford University Press, 2005), and the crisis has done nothing but heighten the discussions since then. Market abuse is generally perceived as a serious offence that damages investor confidence and the integrity of financial markets. This has caused scholars to argue that the rationale for controlling market abuse is the maintenance of investor confidence among others (RCH Alexander, Insider Dealing and Money Laundering in the EU, Ashgate, 2007). Rider, Alexander and Linklater note that integral to the efficient operation of any market is the maintenance of confidence in the integrity of its functions. (BAK Rider, C Abrams and TM Ashe, Financial Services Regulation CCH Editions 1997, cited in Alexander, Ashgate, 2007).

Daniel Futej Daniel Grigel An amendment to the Slovak Insolvency Code came into effect on January 1 2012 though important provisions newly regulating the responsibility of statutory bodies and other persons will not become effective until January 1 2013. The key legislative changes concern the test of over-indebtedness and the liability of the directors of insolvent companies There are two insolvency tests: financial liquidity test (the ability of the company to comply with its due debts) and test of over-indebtedness (the ratio of the company's total assets to its total debts – until the amendment it related to overdue debts). The over-indebtedness test will be assessed taking into consideration the debtor's future (expected) economic results. Subordinated and similar debts will be excluded from calculation of a debtor's financial situation. In both instances, for a company to become insolvent it is required to prove that it has more than one creditor – in the case of the financial liquidity test, with more than 30 days overdue debts.

On September 20 2012, the Government of India issued several press notes liberalising foreign direct investment norms in sectors such as aviation and multi-brand retail (MBR). The government thus allowed foreign investors to hold up to 51% of the share capital in Indian companies operating in the MBR sector, and allowed foreign airlines to hold 49% in companies operating scheduled and non-scheduled air transport services. Before this liberalisation, foreign direct investment was prohibited in MBR, and foreign airlines were prohibited from investing in air transport services (though foreign entities other than airlines could make investments in this sector).

Jane Sim Serene Sia Through a press release on October 3 2012, Singapore's Ministry of Finance (MOF) confirmed that it has completed its review of the Companies Act. Following the public consultation carried out in 2011, the MOF has accepted 192 and modified 17 recommendations of the Steering Committee. This is the largest number of changes to the Act since it was enacted in 1967. The wide ranging changes are aimed at maintaining Singapore's competitiveness as a business hub, reduce regulatory burden and compliance costs for companies, provide greater flexibility for companies, and to improve the country's corporate governance landscape. Most importantly, it will bring benefits to various stakeholder groups such as companies, small and medium-sized enterprises (SMEs), retail investors and company directors. Following are some of the noteworthy changes:

Jaime de la Torre Viscasillas On August 31 2012, the Spanish government approved Royal Decree-Law 24/2012 on the restructuring and resolution of credit entities, which implements its commitments assumed in the Memorandum of Understanding agreed with Eurogroup on July 2011 and the proposal for a Directive establishing a framework for the recovery and resolution of credit institutions and investment firms that is being discussed at the EU Parliament. Within the next three months, the Fund for Orderly Bank Restructuring (FROB) will incorporate an asset management company named Sociedad de Gestión de Activos Procedentes de la Reestructuración Bancaria, which will be owned by the FROB, and financial entities (public participation must be less than 50%). The purpose of this company will be the tenancy, management, acquisition and transfer of troubled assets, and it will be authorised to issue obligations or other debt instruments (with no limits on the amounts).

Mian Muhammad Nazir The Emirates Bankers Association has set up an Islamic Banking Committee (IBC) to review various shariah governance models at the regulator's level and to propose a suitable model for the Central Bank of UAE to implement. The IBC is assessing the merits and demerits of different models practised in other countries. The IBC is mandated to suggest a shariah governance structure at the Central Bank which will provide the regulatory support to Islamic financial institutions (including Islamic windows) through setting up an Islamic banking department at the Central Bank of UAE. Most likely the shariah governance structure at the Central Bank will essentially follow an improved form of any of the existing models. This involves, among other things, establishing a shariah supervisory board at the Central Bank to oversee the overall regulation of the Islamic financial institutions. In proposing a suitable governance structure, particularly recommending a shariah supervisory board at the Central Bank, the Emirates Bankers Association would certainly be endeavouring to reconcile the mandatory provisions of Federal Law No 6 of 1985 and the precedents of having a shariah supervisory board at the central banks.

Continuing its efforts to promote transparency, Vietnam's Ministry of Finance issued Circular No 52/2012/TT-BTC on April 5 2012, guiding the disclosure of information on the securities market (Circular 52). This came into effect from June 1 2012, replacing Circular No 09/2010/TT-BTC (Circular 09). In addition to Circular 52, the State Securities Commission (SSC) promulgated Decision No 515/QD-UBCK dated June 25 2012 enabling the disclosure of information on the SSC website (Decision 515).

Gustavo Vega Arrazola Savings and Credit Entities (SCEs) are regulated financial institutions of private capital authorised to develop credit and lending activities. In El Salvador, the operation of SCEs is governed by the Law of Cooperative Banks and Savings and Credit Entities, which came into force on July 1 2001, and was amended in January 1 2009 to its current regime. SCEs are monitored by the Superintendency of the Financial System. As regulated financial institutions, SCEs are subject to many Banking Law provisions. SCEs can be authorised to accept deposits from the public; nevertheless they can operate as SCEs without the authorisation to accept deposits, just developing lending and credit activities.