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The long-awaited changes promise to create a more evolved business environment for foreign participants

Maria Jose Cole The Costa Rican Securities Regulator (Superintendencia General de Valores or Sugeval), through the National Council for Supervision of the Financial System (Consejo Nacional de Supervisión del Sistema Financiero or Conassif), recently adopted amendments to the rules governing project finance and securitisation in Costa Rica. The amendments make structural and operational reforms to address the concerns market participants have reiterated regarding limitations set out in the previous regulations, on topics such as asset collateral, related party financing and government approvals.

Luis Gabriel Morcillo-Méndez Lyana De Luca A new collective investment scheme for real estate investments was recently created to manage and develop real estate projects in Colombia. Foreign real estate managers now have the opportunity of creating this type of vehicle in Colombia to be managed from their countries of domicile (without requiring local licensed presence but acting in cooperation with a local fiduciary entity or stock broker that remains liable before the superintendence of finance for the fund's investments). Decree 2142 of 2013 introduced the Real Estate Collective Investment Funds (RECIF), which are closed-end investment collective vehicles that hold at least 75% of their total value in real estate assets. This is a break-point in the local industry. Since 2007, real estate funds have been incorporated under the form of private equity funds (fondos de capital privado) managed by a local administrator and a general partner, which could be either a local or foreign unregistered entity. RECIFs are a separate investment vehicle with specific requirements in governance and managing structure.

Elias Neocleous On December 2 2014, the Cyprus finance minister and the American ambassador to Cyprus formally signed the inter-governmental agreement between Cyprus and the US under the Foreign Account Tax Compliance Act (Fatca). Fatca is an American tax measure enacted in 2010 to prevent and detect US tax evasion and improve taxpayer compliance by requiring foreign financial institutions (FFIs) to report information related to the ownership by US citizens of assets held overseas. A 30% withholding tax is imposed on transactions with overseas financial institutions and other entities that fall within the scope of Fatca unless the institution concerned has concluded an agreement with the US Internal Revenue Service defining its reporting obligations, or the institution's home country has concluded an inter-governmental agreement (IGA) covering the relevant matters. There are two main forms of IGA, known as Model 1 and Model 2. Under the Model 1 IGA, institutions subject to Fatca report information to their own tax authorities for onward transmission to the US authorities. Under Model 2, institutions provide information directly to the American authorities.

Oene Marseille Emir Nurmansyah Indonesia's Ministry of Transportation has issued an amendment to its previously issued regulation on airfare pricing. The amendment was issued on December 30 2014, and effectively places a non-waivable floor on domestic airfares. Airfares for international flights are not affected by the amendment and will continue to be governed by the rules of the International Air Transport Association.

Takuya Sonoda In 2014, the Japanese Diet agreed to amend, in two stages, the Act against Unjustifiable Premiums and Misleading Representations. This was following a series of scandals in which the menus used at a number of famous hotels and restaurants in Japan were found to be misleading, listing ingredients not actually used in the dishes. First, the Act for Partial Amendment of the Act against Unjustifiable Premiums and Misleading Representations (Law 71 of 2014) was promulgated on June 6 2014 and came into force on December 1 2014. This amendment introduced the requirement that business operators take all necessary measures to ensure the accuracy of all representations made to customers, including the establishment of appropriate managerial systems. Prime Minister Abe, on November 14 2014, oversaw the publication of guidelines to this amendment, setting out the fundamental policies of the amendment and listing specific examples of measures that must be taken by business operators in Japan.

Ahmad Zulkharnain Musa On August 21 2014, the Securities Commission (SC) released a public consultation paper on a proposed regulatory framework for equity crowdfunding (ECF) as an alternative funding channel. After input from the public, the SC released the public response paper on September 25 2014, with certain revisions to the proposed framework. Under the proposed framework, issuers must be locally incorporated private companies (other than exempt private companies). They are eligible to participate in the ECF through a web-based ECF platform via a primary offering to retail, sophisticated and angel investors. They can raise up to RM3 million ($842,000) within a 12-month period and a maximum of RM5 million. Sales of existing shares through the ECF will not be permitted.

Pedro Cortés Marta Mourão The Legislative Assembly is appraising a proposal to amend Decree Law 40/95/M of August 14, which establishes the right to compensation for occupational accidents and diseases. To further enhance the protection of rights of injured workers and to clarify the procedures necessary to compensate damages arising from occupational accidents and diseases, the draft law provides for a wider range of situations that may be considered an occupational accident.

Recently there have been some notable rulings by Mauritian courts. The first is Crociani and others v Crociani and others and Princess Camilla de Bourboun des Deux Siciles. In the trust deed in question, the relevant part of clause 12 stated: 'thereafter, the rights of all persons and the construction and effect of each and every provision hereof shall be subject to the exclusive jurisdiction of and construed only according to the law of the said country which shall become the forum for administration of the trusts'.

Banji Adenusi Recent mezzanine financing in Nigeria continues to adapt globally accepted structures to meet local conditions, especially in view of the recent economic reality. A key concern for foreign lenders relates to the structure of the transaction. This has taken the dimension of junior secured loans subordinated to senior lenders, in which the obligations of the borrower group to repay is passed through special purpose vehicles (SPVs) set up to warehouse the assets of the borrower group, with the SPV maintaining back-to-back service contracts with the borrower group. Two asset financing and expansion transactions in the oil-servicing sector recently adopted this structure. In both instances, assets were split between two SPVs, with the mezzanine lender acquiring a subordinated claim to the assets of the first SPV, and a first ranking claim to the assets and receivables of the second SPV. What is most interesting (although usual from an international standpoint) is the common thread running through these transactions – the insistence by the lenders on the inclusion of cross-default and cross-acceleration provisions in the financing agreements in relation to the borrower's other financings, creating a domino effect on the borrower's obligations. Counterparties often negotiate these provisions, including the instances that trigger the operation of the clauses, along with the restructuring conditions. From the lender's perspective, these provisions are designed to mitigate the broad spectrum default events that a transaction might be exposed to, with a view to expanding the scope under which a mezzanine lender can accelerate outstanding repayments. The borrower's inability to meet its financial obligations to its other financiers raises credible concerns about its ability to meet obligations to the mezzanine lender, with the implication that rather than wait for a payment default under its facility to the borrower, it would exercise the right to sit with the senior lenders as creditors of the borrower.