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As the comment period for Reg AB II closes, issuers and investors continue to clash over the level of disclosures in ABS offerings

Spain has overhauled its bankruptcy regime in a bid to make it easier for ailing companies to avoid liquidation. But the long-anticipated reforms will likely need further amendments to ensure they are workable

Virtual currencies are set to play a key role in the evolution of finance. But developing links between the two worlds won't be easy

Mak Lin Kum The Companies Bill 2013, tabled by the Companies Commission of Malaysia, proposes a new approach to the reduction of share capital, in line with developments in jurisdictions like Australia and Singapore. At present, a special resolution for the reduction of share capital requires a confirmation by the court before it can take effect. The new bill allows an alternative and a seemingly simpler process of capital reduction, whereby only a special resolution and solvency statement are required. The option of going to court to confirm a capital reduction resolution is still preserved under this new Bill. Although it may appear that this non-court approach is simpler, several reasons may be offered as to why the court approach may continue to remain popular and not be rendered obsolete.

Enforcement places a significant strain on the finances of liable parties, and as such the legislation on enforcement should offer not only a legal basis for effective enforcement, but it should also ensure reasonable protection for the liable parties.

Soonghee Lee In late 2013, the Supreme Court rendered a decision involving the issue of whether the contents of an investment prospectus is contractually binding if it differs from the contents of the trust agreement provided to the investor under an investment trust agreement. In this case, the plaintiffs claimed damages against financial companies on the grounds that the asset management company, without the plaintiffs' prior consent, changed the transaction counterparty to Lehman Brothers Asia, which was different to that stated in the investment prospectus. Further, they stated that the sales companies sold more than W20 billion ($18.5 million) of beneficiary certificates for the fund without considering the possibility of such change in transaction counterparties, and therefore, since the plaintiffs were provided information which made it impossible for them to be aware of the relevant facts (due to the different investment subject and investment limit from those contained in the investment prospectus) such acts constituted tortious conduct and default of contractual obligations. At the appellate level (before appeal to the Supreme Court), the plaintiffs partially prevailed against the asset management company. But the Supreme Court reversed the appellate court's decision on the grounds that (among others): (i) since the part of the investment prospectus which stated that the transaction counterparty to the OTC derivative products was BNP Paribas, cannot be viewed as merely an elaboration on the terms of the trust agreement, such contents cannot be viewed as a part of the terms of the investment trust agreement and contractually binding; and (ii) given that the bankruptcy of Lehman Brothers could not have been predicted, the change of the transaction counterparty to the OTC derivative product due to unavoidable circumstances, with a payment guarantee of Lehman Brothers (which has a similar credit rating as BNP Paribas) cannot be viewed as a breach of the investment prospectus or breach of fiduciary duty.

The lighter side of the past month in the world of financial law

Elias Neocleous The Cyprus Securities and Exchange Commission (CySEC) has announced a number of proposed amendments to the Laws Regulating Companies providing Administrative Services and Related Matters of 2012 and 2013 (the ASP Law), following discussions between the Ministry of Finance, the troika of providers of international financial support to Cyprus, and the competent authorities (namely, the Cyprus Bar Association, the Institute of Certified Public Accountants of Cyprus and CySEC). The proposed amendments aim to address practical issues that have emerged, and to meet the requirements of the Memorandum of Understanding with the troika. There are several main proposed amendments, the first being that occupational retirement benefit funds (under the supervision of the Registrar of Occupational Retirement Benefit Funds in accordance with the Establishment, Activities and Supervision of Occupational Retirement Benefit Funds Law of 2012) are explicitly excluded from the scope of the ASP Law.

An incoming ABS law introduces bankruptcy remote SPVs, note trustees and other concepts needed to create modern deal structures

The US regulator's investigation into the rate-rigging scandal poses difficult questions for jurisdictions around the world. University of New South Wales' Professor Justin O'Brien explains why