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John Taylor, general counsel at the European Bank for Reconstruction and Development, London, talks to Diana Bentley

Performance bonds are contracts of guarantee commonly used in international trade. Their commercial purpose is to secure the performance of a primary obligation through assured and prompt payment in case of default. No dispute arising out of the underlying agreement between the principal and the beneficiary of the guarantee ought to interfere with the independent undertaking of the guarantor. Hence, performance bonds invariably include an absolute undertaking by the guarantor to pay 'on first demand'.

In a referendum, Norway voted against membership of the EU. However, because Norway is a member of the EEA, EU legislation on finance and commerce must also be implemented as domestic Norwegian law. Not only does this open up Norway for business from the EU; it opens up the EU for business from Norway.

The concept of lending money is relevant to a number of pieces of legislation in Australia and can be either the trigger for the imposition of restrictions or the basis of exemptions.

A bill on the legislative framework for the National Securities Centre was recently published by the Finnish government. Under the proposal, legislation on the book-entry securities system would also be amended.

Measures have been adopted by the Brazilian government in the last two years to safeguard the economic stabilization programme by curbing money supply increases caused by foreign investment inflows. On October 31 1996, two of the measures were relaxed as follows:

Resolution No. 58/3/96 of the Board of Directors of the Central Bank concerning the regulation of finance companies (Resolution 58) was promulgated under the authority set forth in Articles 114 to 119 of the Central Bank Law, which pertain to Financial Corporations (mu'assasat maliyyah). Article 114 of the Central Bank Law defines Financial Corporations as those institutions whose principal functions are to extend credit, to carry out financial transactions, to take part in the financing of existing or planned projects, to invest in movable property and such other functions as may be specified by the Central Bank. Financial Corporations may not accept funds in the form of deposits but may borrow from their head offices, from local and foreign banks, or from financial markets.

The lack of an international insolvency regime is a glaring anachronism in the era of global markets. While regulators are getting their act together, private initiatives offer the best alternative. By Daniel Cunningham and Thomas Werlen of Cravath, Swaine & Moore, New York

Simon Firth of Linklaters & Paines, London, looks at the growth of a trend that has contributed significantly to the reduction of credit risk in the financial markets, and a proposal to boost it further

In the largest privatization in European history, 600 million shares in Deutsche Telekom have been sold for a total of Dm20 billion (US$13 billion). At a share price of Dm28.50, in the middle of the Dm25 to Dm30 guide, the issue was five times oversubscribed.