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Hogan Lovells' Alex Sciannaca and Giles Hutt analyse the steps being taken by the US and EU to implement the global convention on choice of law agreements

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

The US has proposed a $1 billion loan guarantee programme for Ukraine. Arnold & Porter's Steven Tepper explains why this marks a significant expansion of the government's foreign assistance tool

Anna Pinedo In mid-February 2014, the Federal Reserve approved the final enhanced prudential rule for foreign banking organisations (FBOs) under Section 165 of the Dodd-Frank Act. The final rule applies enhanced standards to FBOs that have a US banking presence, with the most onerous standards being applied to FBOs that have combined US assets of $50 billion or more, or US non-branch assets of $50 billion or more. Admittedly, the rule does not require subsidiarisation of the US operations of foreign banks, and it eliminates the requirement that FBOs with US assets outside the branch and agency network of less than $50 billion establish an intermediate holding company (IHC) for its US subsidiaries. This IHC requirement would apply only to the largest FBOs. The IHC would be subject to regulatory requirements applicable to comparably sized US institutions, such as risk-based capital standards and leverage requirements and other prudential standards on a consolidated basis, including stress testing. Branches and agencies would operate outside the IHC requirement, be subject to liquidity requirements, and may be required to hold liquidity buffers outside the United States. In addition, certain institutions would be required to implement certain risk management policies and procedures, including, for example, forming a risk committee to oversee risk management for its combined US operations and employing a US chief risk officer to aggregate and monitor risks of the combined US operations. Other prudential standards will be addressed separately, such as the large exposure framework for banks and remediation frameworks. Although the final rule addressed a number of the concerns that were raised regarding the December 2012 proposal, it still raises quite a number of issues for complex banking entities with international operations, including significant US businesses. The final rule was adopted shortly after the Volcker Rule had been finalised. It is too early to predict how the activities of foreign banks may be affected by the cumulative impact of the Volcker Rule and this rule. But many foreign banks will certainly consider carefully each of their businesses, the regulatory capital costs associated with these, whether it is possible or desirable to restructure certain businesses so that activities are conducted solely outside of the United States, and the incremental regulatory and compliance costs and risk exposure associated with retaining these businesses in the United States. Regulators outside of the United States can be expected to adopt, and in certain cases already have indicated that they are considering adopting, similar measures in order to address the risks posed in their jurisdictions by the activities of banking entities organised outside of their jurisdiction. One can't help but wonder whether this will lead to the balkanisation or localisation of banking activities.

An incoming legislative amendment could force China to reconsider its fragmented system of financial markets oversight

João Nuno Riquito and Bruno Almeida of Riquito Advogados navigate the network of interests and rules that arise in cross-border mergers involving Macau

Panagiotis Drakopoulos Evangelos Margaritis Lately, domestic and international financial and corporate players have been looking to the Athens Exchange for safe yet high return investment opportunities in Greece and south east Europe. They are seeking to make takeover bids on securities of companies established in Greece and listed on the local exchange with significant presence in the wider region. It is common knowledge that M&As are the most transparent and efficient way to gain control of the desired target company, following a public offer on all or a part of the target's capital. However, this does not seem to be their unique advantage in the Greek legal order. The speed of their conclusion, with an average duration of two months, allows the investor to begin their business quickly and efficiently. The investor will be in a position to choose a board of his own preference within a few days of the expiry of the public offer, and to focus on what matters: building the business. The Greek legal framework on takeover bids (mainly 3461/2006 as in force – the Law) harmonises local law with the relevant EU Directive 2004/25/EC. The Law distinguishes between mandatory and voluntary offers. The former is necessary whenever an investor gains direct or indirect control of more than a third of the voting rights in a company, and as a result the control of that company. In this case, the investor is obliged, within 20 days of the acquisition, to make a public offer (mandatory bid) for the remaining shares of the company. The same obligation lies with every shareholder who holds more than a third but less than half of the voting rights of the target company, if within six months said shareholder acquires (alone or with others), securities of the target company which represent more than three percent of the voting rights. Voluntary offers can be submitted at any time, and refer not only to voting, but also to non-voting shares. The bidder can stipulate a minimum and a maximum quantity of shares that the bidder is willing to acquire.

Law Decree 145 of December 23 2013, converted into law with amendments by Law 9 of February 21 2014, (Decree 145) has introduced wide-ranging amendments to Law 130 of April 30 1999 (the Securitisation Law). The five most relevant amendments are discussed below.

Alexei Bonamin Ricardo Mastropasqua On December 20 2013, the Brazilian Exchange Securities Commission (CVM) issued a set of rules which regulate the rendering of services related to the Brazilian capital markets' infrastructure, as follows: (i) CVM Instruction 541 regulates matters regarding the centralised deposit of securities; (ii) CVM Instruction 542 governs the rendering of securities custody services; and (iii) CVM Instruction 543 regulates securities bookkeeping services and the issuance of securities certificates. In accordance with CVM Instruction 541, the centralised deposit service of securities comprises the following activities: (i) securities' safekeeping by the central depository; (ii) controlling the chain of ownership of securities in the deposit accounts maintained on behalf of investors; (iii) restricting practices related to securities' disposal by the ultimate investor or by any third party outside the central depository environment; and (iv) the handling of trading instructions and of incidental events that affect the deposited securities, with the corresponding records on the deposit accounts. CVM Instruction 541 does not apply to positions held in the derivatives market outside the central depository environment. However, it does apply to the establishment of liens and encumbrances on positions held in derivative agreements of any kind, provided that the central depository is also authorised to provide registration services to such agreements. CVM Instruction 541 also applies to financial bills and other instruments that are subject to the jurisdiction of CVM.

Takeho Ujino The Act on Special Provisions of Civil Court Procedures for Collective Recovery of Property Damage of Consumers (Act 96 of 2013 – the Act) was promulgated on December 11 2013, and is scheduled to come into force within three years – the specific date to be designated by a cabinet order. The Act introduces a new class action system that sets out procedures which enable a group of consumers to recover damages collectively in a simple and prompt manner (the system). The system consists of two stages. In the first stage, the court will render a declaratory judgment on the common liabilities of the accused business operator, which must arise from a common legal and factual cause and be shared by multiple aggrieved consumers (common liabilities). Only a specified qualified consumer organisation certified by the Prime Minister as fulfilling the requirements of the system may file a first stage procedure. If the organisation succeeds at the first stage, the amount to be paid to each aggrieved consumer will be determined at the second stage, during which the group of aggrieved consumers delegates the resolution of their claims to the organisation, which then brings the relevant claims to the court. The court will then issue a decision regarding the amount of compensation that can be recovered from the accused business operator by each of the aggrieved consumers.