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The long-awaited promulgation of the new Chinese Contract Law approaches. On September 7 1998, the People's Daily published the draft of a Contract Law containing 441 articles, another step towards unification of domestic and foreign-related legislation in China. The draft contains general provisions on formation, validity, performance and termination of contracts, as well as special provisions on certain types of contracts (eg sales contracts, loan contracts, lease and financial lease contracts, construction contracts and transportation contracts).

In a highly significant case under the US bankruptcy laws, Hong Kong and Shanghai Banking Corporation v Simon [9th Cir 1998], the US Court of Appeals for the Ninth Circuit ruled that a foreign creditor may not bring a foreign collection proceeding against a debtor that has obtained a discharge under the bankruptcy law. In so doing, the Ninth Circuit has affirmed the extraterritorial effect of the US Bankruptcy Code.

In the wake of Asia’s downturn, Korea has liberalized foreign investment laws and a similar move threatens the legal profession. Stephen Mulrenan reports from Seoul on why lawyers are divided over the issue of foreign competition

UK firm Allen & Overy has provided advice to the project company and the sponsors of a US$373 million project finance deal in Vietnam. The Nghi Son Cement Company project is one of the largest project finance deals in Vietnam this year and one of the first deals to be financed with a multi-tranche limited recourse facility. It is also one of the first times that an offshore account has been used to channel finance directly to a project in Vietnam.

UK law firm Norton Rose is advising on a US$60 million cross-border Ijara leasing facility on behalf of Telekom Malaysia Berhad. The transaction is taking place in the context of recently enforced Malaysian capital controls and involves complex arrangements between investors from south-east Asia and the Middle East. Under the deal, equipment is to be sold then leased back to Telekom Malaysia Berhad using a special purpose vehicle located in Labuan. The transaction was conducted according to Islamic law, so that financing arrangements must be tied to assets rather than taking the form of cash advances with attached conditions. The Malaysian government also imposed a range of capital controls in early September, further complicating the deal arrangements.

US law firm White & Case and Dutch firm De Brauw Blackstone Westbroek have advised Royal Ahold on its US$2.3 billion global offering. The offering involved listings on the Dutch AEX Stock Exchange, the Swiss Stock Exchange and the New York Stock Exchange. The transaction included 51,750,000 shares, also issued as American Depositary Receipts (ADRs), and Fls 1.495 billion (US$817 million) convertible subordinated notes due 2003, also issued in the form of ADRs. It was one of the first offerings into the US to take account of the euro due to the maturity of the convertible notes being reached in 2003. The offering is intended to help finance the recent purchase by Ahold of Giant Food.

Michael Alcamo of White & Case, New York explains how to draft prospectuses in plain English and asks the SEC what issuers can expect from the new rules

US firms Cleary Gottlieb Steen & Hamilton and White & Case took the lead on the US$300 million 10-year issue by the state-owned Electricity Generating Authority of Thailand (EGAT) which closed on October 14. The issue, sold under Rule 144A in the US, incorporated a World Bank guarantee of principal and interest (on a partial basis), the first time the World Bank has provided a guarantee of principal and a single coupon payment on a rolling basis. Through this structure, Asian borrowers can access the global markets without incurring the risk premiums imposed since the financial downturn in July 1997.

French firm Gide Loyrette Nouel is to lose four lawyers to the Linklaters & Paines Paris office. The lawyers are part of Gide's mergers and acquisitions and litigation team. Their arrivals will double Linklaters' total of corporate partners, bringing it up to eight. Gide partners Thierry Vassogne, Marc Loy and Olivier Diaz and senior associate Arnaud de la Cotardiere will all become partners at Linklaters, with Vassogne becoming co-head of the Paris office alongside Jean-Marc Lefevre. Vassogne, a high profile litigator will no doubt be missed by the firm, despite what Xavier de Roux, Gide Loyrette Nouel partner describes as "conflicts of interests and difficulties between partners" in the firm's M&A department. He says: "Thierry Vassogne has been with the firm for twenty years and of course we all like him, but our M&A department has more than fourteen partners, and this is something which happens in law firms. We have had seven partners leave in thirty years."

Formula One Holdings, which controls television rights for the motor racing world championship is planning a US$2 billion Eurobond issue within the next few weeks. The issue through Formula One Finance BV replaces plans for a flotation of Formula One Holdings. The flotation was abandoned last year following an inquiry by the European Commission into the relationship between motor racing's governing body, the FIA, the television broadcasters and the Formula One companies. The bond issue may be a preparatory move before another flotation attempt.