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The Cyprus Stock Exchange (CSE) has embarked on its most ambitious project yet, the creation of an electronic exchange. With a view to improving its connectivity, speeding up securities transactions and cutting costs, the CSE has signed a contract with an Australian computer firm to develop and install the required equipment and software. Full computerization of trading as well as back office procedures, ie clearing and settlement, is scheduled to be operational by mid-1999. The customization and testing of the electronic dealing system is under way. The same system architecture is already used by the Geneva, Moscow and Oslo stock exchanges. Even though the exchange is to go on-line, the trading floor will continue to exist for some time. Remote-terminal-based trading will follow at a later stage. The provision of central clearing facilities for stock exchange transactions under the electronic system was put out to tender and won by a major Cypriot banking institution.

Legislation was recently introduced into New Zealand's parliament to reform various aspects of the law on payments finality and netting arrangements. The aim of these amendments is to increase the efficiency of, and reduce the risk in, New Zealand's financial system. The amendments have been promoted by the Reserve Bank of New Zealand in conjunction with the introduction of real-time gross settlement of high value interbank transactions (see International Financial Law Review, April 1998, page 55). It should be noted, however, that it is proposed that these amendments apply to companies and individuals as well as banks.

The Monetary Authority of Singapore has accepted the recommendations of the Financial Sector Review Group for new disclosure policies for banks, to make Singapore banks more transparent and accountable while having little impact on their balance sheets. The recommendations are expected to be implemented within the financial year, and include:

Market access for foreign enterprises into China is still restricted. Particularly limited are possibilities for the establishment of foreign investment enterprises (FIE), including equity and contractual joint venture companies with Chinese and foreign investment as well as wholly foreign owned enterprises, directly engaged in trading and distribution activities.

Consob has recently approved new rules implementing Legislative Decree No. 58 of February 24 1998 under which authorized intermediaries will have the possibility to promote the sale and to place investment services, financial instruments and other financial products using distance communication techniques. The techniques must allow the realization of a contact with single investors, with the possibility of a dialogue or other forms of rapid interaction, or provided that documents or messages submitted to the investors have a contractual nature or are not limited to a description of the terms and characteristics of the offering subject, the offered investment services or the financial instruments. Authorized intermediaries, except for management companies contemplated by Legislative Decree No. 58, may, in relation to quotas of investment funds created or managed by them or the shares issued by investment companies with variable share capital, promote and place financial products using distance communication techniques. This is the case provided the investor has not expressly declared it does not agree with the use of these services, it being understood that authorized intermediaries will have to comply with the transparency rules set out by Consob in connection with carrying out financial intermediation services.

UK firms have traditionally led the development of top tier international legal practices. Linklaters’ European merger may speed up the race for global dominance. Nick Ferguson reports

A pool of French, English and American firms worked for the success of the IPO of GEC Alsthom, the joint venture between GEC and Alcatel Alsthom, now renamed Alstom. The offering, totalling US$3.7 billion, comprised shares, depositary receipts and ADRs, with a primary listing in Paris and secondary listings in London and NewYork. Goldman Sachs and Credit Suisse First Boston acted as joint global coordinators.

In a world of global finance and capital flows, the extra-territorial reach of national securities laws needs to be clearly defined. In the US, this is not the case. The absence of legislative guidelines has spawned considerable litigation.

In June the Minister for Economic Affairs tabled a proposal in parliament making it possible to merge (or cooperate through a holding company) between banks organized as savings institutions and mortgage credit institutions organized as member associations. On the same day BG Bank and Realkredit Danmark published their intention to do exactly that. Banks organized under the rules governing BG Bank until now have been subject to rules limiting shareholders' voting rights (also in a holding company controlling a bank organized as a savings institution company). The limitation of shareholders' voting rights may now be abolished by the shareholders. The abolition may pave the way for a mortgage credit association holding the majority of votes in a merged entity — as is required by law.

Sirona Dental System, the dental equipment business, has issued a Dm170 million (US$309.1 million) to refinance a subordinated bridge loan facility related to its leveraged buy-out from Siemens by Shroders Venture. The total purchase price was Dm750 million. Warburg Dillon Read acted as lead manager for the offering.