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Hedge fund advisers, leaders of the largest unmonitored financial institutions, and credit default swaps, the largest unmonitored products, will be forced to register with regulators and self-regulate to please investors in 2009.

In the last year, hedge funds have taken a massive hit. In December 2007, assets under management were valued at $1.92 trillion. In December 2008 were down to $998.4 billion, the first time this figure has dipped under $1 trillion since mid-2004.

Singapore Exchange (SGX) has issued a consultation paper seeking public feedback on the proposed permanent penalty framework for non-delivery of securities. For readers who are keen to read more on the proposed framework, the same may be accessed from SGX's website at www.sgx.com.sg. This is preceded by the implementations of SGX on September 22 2008 to prevent settlement failures of securities and abusive naked short selling. Short selling is the sale of securities or commodity futures not owned by the seller (who hopes to buy them back later at a lower price).

The Dutch Ministry of Finance announced on December 16 2008 that it will investigate the pros and cons of three potential drastic measures on interest taxation. One possibility is clearly preferred: tax exemption/no deductibility for interest income from and interest expenses to related parties, or the introduction of an obligatory group interest box (taxation/deduction against a low rate). This may be combined with a restriction on deduction of third party interest on loans related to the funding of acquisitions of subsidiaries and allowing participation exemption on group finance subsidiaries. The two (theoretical) alternatives that will be studied are: (i) no deductibility/tax exemption for all interest expenses and income or a system based on comprehensive business income taxation; and (ii) anti earning-stripping rules (similar to those in Germany and Italy). As said, those alternatives are not the preferred option. In particular, (ii) is not favoured at all. It will only be considered if other options turn out to be impossible. The Ministry of Finance has indicated that it will submit a bill to parliament in the first half of 2009.

The Brazilian Securities Commission (CVM) has submitted to public hearing a draft regulation on the registration of listed companies in Brazil. As proposed, the new regulation would replace rules in place for more than 15 years. Key developments focus on: (i) enhancing the level and quality of disclosure; (ii) creating three different categories for listed companies (there's one at present); (iii) establishing different levels of disclosure for the different categories of listed companies; and (iv) harmonising the rules applicable to listed companies. Investment funds would still be under specific regulation and not be affected by this new development.

At the end of October 2008, the Croatian parliament adopted a new Concessions Law and a new Public Private Partnership Law (PPP Law). The adoption of these laws, in conjunction with the prior adoption of the Public Procurement Law, completes Croatia's regulation of public procurement. The PPP Law became effective on November 5 2008 and the Concessions Law will became effective on January 1 2009.

Austrian credit institutions recently rediscovered the benefits of participation capital (partizipationskapital) when it comes to increasing their Core Tier I ratio and to enhancing their risk-bearing capacity. Inspired by the Austrian financial market stability scheme, intended to assist credit institutions and insurance undertakings in the looming financial crisis, institutions appear to have rediscovered this Austrian-specific instrument. Several Austrian banks have announced that they might draw on the state's assistance by issuing participation capital in order to enhance their financial status.

On January 5 2008, the electronic share certificate system under the Law on Book-Entry Transfer of Corporate Bonds, Stock and Other Securities (shasai-kabushiki-tou-no-furikae-ni-kansuru-horitsu) will be implemented. Upon implementation, all shareholders' rights in listed companies will be recorded and managed electronically in transfer account books (furikae-kouzabo) maintained by record-keeping organisations (kouza-kanri-kikan) such as banks and securities companies. Under the present system, shareholders hold paper share certificates and transactions are conducted by physically transferring the paper share certificates. In accordance with the Act on Custody and Transfer of Share Certificates (kabuken-tou-no-hokan-oyobi-furikae-ni-kansuru-horitsu), shareholders of listed companies also have the option of depositing paper share certificates of those listed companies with the Japan Securities Depository Center (JASDEC) (hofuri), a public custody organisation in Japan. However, with the implementation of the new system, paper share certificates will no longer be used and all accounts will be maintained electronically. The introduction of the electronic share certificate system should be beneficial to both shareholders and listed companies.

France's changes to its insolvency rules have done very little for secured creditors. That is a shame - it would have helped credit in a market that sorely needs it

Guidelines on the Law were overdue and very welcome. But the Coca-Cola takeover will be the event to watch in 2009