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Corporate INTL Special Focus: GE Capital September 2011

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the new legal giant

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CONTENTS Editor’s Talk This month, Corporate INTL focuses on the rise of Islamic finance and iSfin. iSfin is the world’s leading network of Islamic finance law specialists. iSfin members are all specialists from elite law firms with an international focus and deep understanding of Islamic finance. Each member is admitted only after substantial due diligence and peer review procedures. As world finance faces heavy challenges and some Western economies collapse, Gulf and Southern Asian investors are boosted with cash. High energy prices are a significant factor. Another is the fact that ethical Islamic banks were not hit by the credit crunch as they did not offer toxic products like many conventional banks. Islamic finance has seen spectacular growth since 2008, growing 30% in 2010. Islamic banking is just part of the overall Islamic finance sector, which includes asset management and increasingly more sophisticated investment products. Total Islamic assets under management reached $1 trillion in 2010. This growth is being driven by record-high oil profits, which in turn is driving Middle Eastern countries to create world-class financial centres such as Dubai, Bahrain, Abu Dhabi and Kuala Lumpur. According to a McKinsey estimate, Middle Eastern countries will have a total of $9 trillion to invest by 2020. Further demand for Islamic banking will come from the growth in population and wealth of the world’s 1.6 million Muslims. “The ongoing global credit contraction provides an opportunity for Islamic financing to blossom,” said Laurent Marlière, general manager of iSfin. “In fact, it is the fastest growing area of world finance. Islamic finance has now become a global and worldwide phenomenon.”

Islamic Finance – the new legal giant iSfin gives Corporate INTL an in-depth look at the network and the rise of Islamic finance.

Corporate INTL Special Focus: GE Capital Corporate INTL examines GE Capital’s recent acquisition of the UK accounts receivable financing subsidiary of Eurofactor S.A, a part of Credit Agricole Leasing and Factoring.


News & Views


People Moves


Offshore Joint Venture Companies


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International Sector Panel Corporate INTL looks at the latest developments affecting global industries.

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NEWS&VIEWS Inspiring Growth As we are in the second half of 2011 with an uncertain economic outcome ahead and 2012 strategic plans starting to be developed in board rooms, now is a timely reminder for leaders to reassess where their businesses are, where they want to get to and whether staff have the skills they need to get there. For businesses which have restructured over the last couple of years as

Sitting back and waiting for work to roll in may be fine in the good times,

a consequence of the recession or which are currently undergoing such

where work “magically” flows in. However, in a period of very low or flat

a process, serious consideration should be made to reassess how they

growth, competition between professional services firms will intensify and

do things as a business and whether both business owners themselves

if staff are not ready for the battle, their respective firms will suffer. Indeed,

and their staff need external training to fill in skills gaps. It is a quandary

this is going to be brought to the fore shortly in the UK legal industry with the

that in a world of increasing competition and with a possible double dip

impending implementation of the Legal Services Act, recently pushed back

recession around the corner, training budgets are frequently constrained

from the target date of October 2011. Radical changes to the legal system will

at exactly the time when it is critical to ensure that partners and staff have

intensify the need for change within traditional legal firms.

the tools, techniques and passion to help grow their business. Indeed, training can be one of the most efficient uses of limited resources. In

The new legislation, nicknamed “Tesco law”, will open up the UK legal market

professional services or people businesses particularly, the business is the

and allow firms to bring in outside investment for the first time and enable non-

people – no people, no business. Nevertheless, it is easy to spend money

law firms, such as banks and retailers, to sell legal advice. Indeed, businesses

on training and frequently harder to get a return on the investment.

such as Irwin Mitchell and Plexus Law have already explicitly stated that they will be seeking external funding either through private equity or a float. With

“There are a lot of sales trainers out there who are just generic sales

commercially minded external backers looking for a return, it is inevitable that

people or institutionalised trainers and do not truly understand how to

growth will be high on the board agenda and serious consideration should be

permanently change behaviour in professional services firms – they have

given as to whether lawyers are ready for the change and have the required

never been there and done it”, stated Paul Spires, Managing Director

culture, tools and techniques to win more work.

and Founder of Inspire Business Development Limited, which provides professional firms with bespoke training and structured coaching to

Paul, a Chartered Accountant, Insolvency Practitioner and Corporate Financier,

help them win new business and deliver sustainable growth. “Business

believes that “it is absolutely possible to balance the needs of “doing the day

owners should be challenging all potential investment in training to

job” with personal BD efforts”. In Paul’s experience, “the best people to win new

assess whether it will tangibly benefit the bottom line. Businesses will

business are the people actually doing the work.-they just need to know how it do it

only get a return if the attendees positively change their behaviour and

and follow a process rather than a typical scattergun approach. BD should ideally

do more of the right things,” Paul continued. During Paul’s several years

be seen as just part of the day job, not separate from it. If the whole team has the

at Catalyst Corporate Finance, the UK’s leading Independent corporate

right BD mindset and focus, supported by effective processes, the overall firm will

finance adviser, he experienced first hand how an effective BD process

reap dividends. The statement that “I am not a sales person” is getting harder and

can drive massive success and Paul is now passionately assisting some

harder to justify.” Paul believes that “business leaders have a real chance to grow

of the leading law and accounting firms in the UK. “Inspire is about

their respective businesses over the next few years, if they have a support team

inspiring confidence in people to go out and win new business”. What sets

which is motivated and moving towards the same goals. In professional services

Inspire apart from other training providers, Paul believes, is their focus

firms, people buy off people. The firms which grasp this concept and invest in their

on delivering sustainable change, through positively changing people’s

staff to develop a culture which creates opportunities rather that just waiting for

behavior and mindset as well as sharing a proven process for success.

them to fall in their laps, will sail ahead of the competition”.

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For further information please contact Paul Spires (07730 981002 or or visit

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News & views

Bank of America Merrill Lynch to benefit from new addition Earlier this year Bank of America Merrill Lynch welcomed the new addition of Jeremy Harrison who joined Bank of America Business Capital as senior vice president and senior business development officer. Mr Harrison has more than 20 years of marketing and credit experience in asset-

Bank of America Merrill Lynch’s Europe, Middle East and Africa (EMEA) footprint

based lending and has been brought on board to help grow loans and build relation-

comprises of 32 cities across 23 countries on three continents. The company is a long-

ships with referral sources in the United Kingdom and certain areas of continental

established participant in the European markets, with a presence since 1922. Currently

Europe. He will be based in London and report to Joseph Powers, BABC Business

over 14,000 associates are based in EMEA.

Development manager for the East division and Europe, the Middle East and Africa. “Jeremy brings extensive experience in asset-based lending to Bank of America Business Capital and will play a valuable role as we continue to grow in Europe,” Mr Powers said. “We’re pleased to welcome him to our team.” Harrison most recently served as manager of U.S.-based ABL operations at Lloyds

Globally, Bank of America Merrill Lynch serves clients and customers in more than 150 countries and has relationships with 99 percent of the U.S. Fortune 500, nearly 96 percent of the Fortune Global 500 and 33 percent of the FTSE 100. Today, the company offers an integrated and comprehensive set of products and services across all businesses, serving the needs of individual, corporate,

Banking Group. Before that, he worked at GE Capital and GMAC. He is a U.K. native

institutional and government clients, by combining the best of local knowledge

who holds a bachelor’s degree in business studies from the University of Brighton.

and international expertise. Bank of America Merrill Lynch has a strategic and

“I am very pleased to join the Bank of America Merrill Lynch team and help capture the expanding European market for asset-based lending,” commented Mr Harrison.

measured approach to its international development and is strengthening its business and infrastructure to create sustainable, long-term growth.

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Islamic Finance – the new legal giant

Islamic Finance – the new legal giant Laurent Marlière General Manager iSfin + (32) 2 550 38 20

As world finance faces heavy challenges and some Western economies collapse, Gulf and Southern Asian investors are boosted with cash. Mr Marlière noted that high energy prices are a significant factor. Another is the fact that ethical Islamic banks were not hit by the credit crunch as they did not offer toxic products like many conventional banks. “Internationally, one can estimate that there is a need for 50,000 Sharia law experts to advise on Islamic banking and finance matters within the next 10 years,” said Mr Marlière. Islamic finance has seen spectacular growth since 2008, growing 30% in 2010. Islamic banking is just part of the overall Islamic finance sector, which includes asset management and increasingly more sophisticated investment products. Total Islamic assets under management reached $1 trillion in 2010. This growth, Mr Marlière explained, is being driven by record-high oil profits, which in turn is driving Middle Eastern countries to create world-class financial centres such as Dubai, Bahrain, Abu Dhabi and Kuala Lumpur. According to a McKinsey estimate, Middle Eastern countries will have a total of $9 trillion to invest by 2020. Further demand for Islamic banking will come from the growth in population and wealth of the world’s 1.6 million Muslims. “The ongoing global credit contraction provides

There’s a tremendous market available for lawyers and law firms with expertise in Islamic banking and finance, says Laurent Marlière, general manager of iSfin.

an opportunity for Islamic financing to blossom,” said Mr Marlière. “In fact, it is the fastest growing area of world finance. Islamic finance has now become a global and worldwide phenomenon.” Why are law firms aiming at Islamic finance? Mr Marlière explained that some law firms are now realising the need to develop a practice in Islamic banking and finance law. In fact, in the MENA countries, Islamic finance is a well recognised area of practice. With the exception of London and the offshore jurisdictions, law firms did not take a deep look at it. Mr Marlière believes that this is now changing, and opportunistic firms have understood that there is a new financial and legal mainstream there. “Interestingly enough, one has seen many Indian desks or China desks appearing on law firm’s websites, but few Islamic desks,” observed Mr Marlière. “It is a paradox as in macroeconomics, the global power of Islamic finance is even more substantial!” Many countries in the world have a large Muslim community facing difficulties in ensuring its financial needs in a non-Muslim society. There are few options for the growing Islamic communities abroad to access financial arrangements that comply with Sharia-based principles and that also meet the legislative

Key figures (Financial Times 2010) Sharia-compliant financial institutions: 1,124 Assets in Islamic finance: between $822 billion and $1 trillion Increase in such assets in 2009: 29% Worldwide Muslim population: approximately 1.6 billion Percent who use banks: approximately 14% Islamic mutual funds: 473 Islamic money market funds in this total: 79 Islamic real estate funds in this total: 28 Assets in Islamic mutual funds: $35 billion

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Islamic Finance – the new legal giant

needs of the local financial system. Mr Marlière states that the demand is great, and he believes that opportunistic lawyers will attempt to gain the knowledge they need in order to fill the emerging gap in experienced professionals in Islamic banking. “At the moment, Western banks are hiring people from non-Islamic banking backgrounds, and they cannot produce a financial product which is ethically sound to Muslims,” commented Mr Marlière. “These finance experts are trained in conventional finance areas and don’t care about the risk between the buyer and the lender, the need for sharing. “By training lawyers and finance experts in the nonMuslim countries, iSfin can seize on the opportunity of Islamic countries looking abroad given these countries’ performance after the global financial crisis.” Mr Marlière explained that the interest is certainly not limited to the banking & finance practices of firms. In fact, iSfin requires its members to set up an Islamic Finance desk composed of one banking & finance partner, one corporate partner, one tax partner and one regulatory partner. That team is then backed up by the firm’s marketing department. “We see that Islamic investments inbound and outbound raise questions in the corporate and tax area,” said Mr Marlière. “We notice that many of our member firms are advising their local governments and authorities on creating a proper regulatory environment as well.”

They require a provider of legal services which can handle outbound investments, inbound investments and offshore investments. According to Mr Marlière, no firm can possibly provide a team of legal experts active in: • Outbound countries such as UAE, Saudi Arabia, Qatar, Oman, Bahrain, Kuwait, Malaysia, Singapore and Indonesia. • Inbound countries such as the G20 countries as well as emerging markets like India, China and Brazil. • Offshore territories such as Jersey, Guernsey, Isle of Man, and BVI that offer tax structuring. “Banks, funds, private and public investors are seeking a broader network,” explained Mr Marlière. “They want to be serviced on a global and regional scale. They are looking to do business in all major centres and seek a true one-stop shop.”

iSfin iSfin is the world’s leading network of Islamic finance law specialists. isFin members are all specialists from elite law firms with an international focus and deep understanding of Islamic finance. Each member is admitted only after substantial due diligence and peer review procedures. “Our objective is to be global and cover all key jurisdictions in the world,” said Mr Marlière. “We admit that some jurisdictions do not benefit from a proper Islamic finance training as that area is just emerging locally. We provide them with the right training and coaching.”

Geographical spread and focus iSfin aims at truly global coverage, following the path of Islamic investments which currently occur just about anywhere in the world. Mr Marlière noted that initiatives and projects across Asia, in Latin America, Africa, Eastern Europe, Russia and CIS are currently drawing a lot of attention. “We have taken the challenge of membership by its hardest part, which is to identify specialists and interested parties in non-Muslim countries,” said Mr Marlière. “It is more challenging to identify I.F. specialists in Sweden or Greece than in Malaysia or Saudi Arabia!” However, despite this global focus, iSfin excludes London from its membership at this stage. “London is such a strong financial centre that we do not wish to create conflicts of interests with some of our members already working with the global law firms,” explained Mr Marlière. “Besides, we believe that the global players will use the expertise of some of our local members in Islamic finance.” In a second affiliation phase, which is now starting, iSfin is considering the Middle East and Asia, and has begun to assess potential member law firms.

Reasons for the creation of iSfin As a result of the political turmoil in the Arab world and with the global financial crisis fostering opportunities in many countries, sovereign funds are now going global and seeking more secure and stable investments. “There are very few specialists on this high potential emerging market in the world,” observed Mr Marlière. “We have built an unchallenged initiative gathering the best specialists with interest in Islamic finance and able to act both on a global and local scale.” Private and public Islamic finance investors are now seeking a truly global solution to allow for the diversification of their investments.

Member firms iSfin’s member firms include: Afschrift; Gide Loyrette Nouel; P+P Pöllath; Bahas Gramatidis; Appleby; Maples & Calder; Studio Legale Chiomenti; Arendt & Medernach; Houthoff Buruma; Saslo; Mlgts; Cuatrecasas; SyCipLaw; Gernandt & Danielsson; and Lenz & Staehelin. The profile of member firms that iSfin is looking at varies very much from one country to another. The network is cherry-picking independent law firms (not affiliated to the giant global law firms) with a strong banking and finance reputation and valuable tax expertise. “Our member lawyers all have amazing credentials and are highly regarded by Cham-

bers, IFLR, Legal 500 or PLC,” commented Mr Marlière. “We want entrepreneurs who are open-minded and willing to improve their business development and marketing skills with the system of ‘Legal Networking 2.0’ that we have put in place.” Member firms receive exclusivity for their territory, with one firm per country. Exclusivity is however not implied for the exchange of referrals as iSfin is targeting law firms with a long experience in international business. “We focus on our fast growing niche of Islamic finance and want to be the best in that area,” added Mr Marlière. Benefits of membership • Adapting local legislation All governments now have a think tank to adapt their local legislation to make it Islamic finance friendly. Members can pull out the experience of colleagues who have advised their State and become a reference in the area. • Catching inbound investments Members can catch investments made by sovereign funds and Islamic investors/banks in their home country by showing that they understand their culture and needs. • Catching outbound investments Members are able to accompany domestic companies and banks when they invest in Islamic countries via an Islamic desk, showing that the lawyers have broad understanding of local business culture. • Ensuring retention and fidelity of current Islamic clients Member’s current Islamic clients appreciate that they invest in this key area of interest for them and the firms generate more business from this existing clientele. • Receiving referrals from other iSfin members The peer to peer system of the iSfin network, based on specialists, opens up the borders between member firms and generates referrals, often in areas broader than Islamic finance as trust is built up. Beyond these commercial advantages, members access an unchallenged source of knowledge and know-how. “The exchange of expertise is considerable,” said Mr Marlière. “Training sessions, coaching from specialists, support from a strong marketing team and effective leadership comes on top. Members work on RFPs and tenders. Our headquarters prepare them tailor-made business plans for their local markets. Member’s views SyCip Salazar Hernandez & Gatmaitan became a

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Islamic Finance – the new legal giant

member of iSfin this year. The firm has an Islamic finance practice group and wants to interact and interface with fellow practitioners in that field. “iSfin provides us the forum for such interaction and interface,” said Rafael A. Morales, managing partner and member of the board of iSfin. “Being a member of the network enhances our stature in Islamic finance. We foresee that, in the near future, Islamic finance will play an important part in the development of Philippine capital market. As the largest and leading law firm in the Philippines, SyCip Salazar Hernandez & Gatmaitan has the natural desire and inclination to assume a pioneering role in the practice of Islamic financial law. iSfin is our partner in this endeavour. “We will attend iSfin’s seminar on Islamic finance this November in Dubai. This and other forthcoming iSfin activities will keep us abreast of trends and updates in Islamic finance.” Arendt & Medernach is one of the founding members of the iSfin network. The inaugural meeting of iSfin in May 2011 was held in the firm’s main office in Luxembourg, which coincided with the annual meeting of the Islamic Financial Services Board (IFSB), one of the two standard setting bodies in Islamic Finance Bishr Shiblaq, head of Arendt’s representative office in Dubai, stated that the firm joined iSfin because of the strong development of Islamic finance in Luxembourg. Many Sharia compliant institutions have used Luxembourg investment vehicles for their international real estate and private equity investments. Luxembourg has also become the leading European jurisdiction for the set-up of Islamic funds. “Having formed a dedicated Islamic finance team, we wished to share our experience in this field with other specialised and leading law firms worldwide,” explained Mr Shiblaq. “Although iSfin is still young, we have had a very positive feedback from clients and other contacts, who are interested to learn more about it. iSfin is unique as there is no comparable network, offering clients access to a truly global network of Islamic finance practitioners from independent first tier law firms and enabling knowledge transfer between the various member firms. “The next meeting of iSfin is planned for November 2011 and will take place in Dubai during the annual meeting of the International Bar Association (IBA). Arendt & Medernach is an active participant in these meetings and is assisting the iSfin team by inviting interesting speakers.” Cuatrecasas, Gonçalves Pereira joined iSfin at the beginning of 2011. Josep Marsal, partner, explained that this is because the firm expects Spain to introduce legislation to become Sharia compliant. “We would like to be the law firm of reference to assist those Islamic finance investors that might invest in Spain,” said Mr Marsal. “We are very happy with how the network is improving,” continued Mr Marsal. “Since we joined a large number of very good law firms have also joined. We have already had one meeting with all members and we have another one in Dubai in November. The network is moving fast.” Mr Marsal believes that iSfin’s last meeting in May in Luxembourg was very successful. He noted that the members had a chance to discuss how

Josep Marsal Partner Cuatrecasas, Gonçalves Pereira Tel: +34 93 290 54 29 – | Fax: +34 93 290 54 88

Bishr Shiblaq Head of Dubai Representative Office Arendt & Medernach – Avocats +971 44 34 88 65

Rafael A. Morales Managing Partner SyCip Salazar Hernandez & Gatmaitan +632 982-3500; +632 982-3600; +632 982-3700

they are promoting legislation for Islamic finance, particularly in jurisdictions like Spain where such legislation does not yet exist. iSfin’s next meeting iSfin will meet during the IBA conference in Dubai on 1st November. iSfin has a stand in the main hall of the IBA and interested professionals can visit to learn more about the project. “During our meeting, we invite top-notch panellists, Sharia-scholars, and investors,” said Mr Marlière. “We discuss strategy and our members join in a ‘speed-dating’ session to foster tighter cooperation. The ‘crème de la crème’ of Islamic finance law is there! “We are very honoured that IBA President Akira Kawamura himself has confirmed his presence,” added Mr Marlière. 2011 so far iSfin was launched on January 1st 2011, and Mr Marlière states that it has been tremendously successful so far: evidence that it is filling a gap in the market. Josep Marsal, partner at Cuatrecasas, Gonçalves, Pereira and member of the Board of iSfin, explained: “We have managed to affiliate some of the strongest law firms in the world.” Mr Marlière added: “With a current membership of some 20 law firms, we probably already are the largest team of Islamic finance lawyers in the world. This is just a start. A lot of territories still need to be covered.” Competitors Global firms have understood the potential behind Islamic Finance and have started investing in subpractice groups within their banking and finance departments. Key players in the sector include the magic circle firms such as Allen & Overy, Linklaters or Clifford Chance. They had the capacity to establish a broader presence and have opened up offices in several centres in the Middle East.

They were followed by some international firms who started establishing one or two small outposts; looking to take advantage of the high predicted growth rates for the Middle East. Mr Marlière explained that practically, many of these firms simply send a partner from their home office who recruits a couple of local associates to set up their Islamic Finance practice. The most skilled lawyers of these firms, often at the associate level, remain in the home office. Resident partners often stay a couple of years then go home and lose the personal connections they had just started to establish. “Geographically, this results in bilateral or at best slightly multilateral connections: London – Dubai, Ney York – Abu Dhabi,” observed Mr Marlière. “Even some of the global firms are missing out, as, while they may be able to place a few real specialists in Islamic finance law in some locations, they are certainly not able to cover all their offices! “Actually our business model and positioning on the market is unique and that is why it will be success-drive. Besides, it really is a truly international project. No culture is predominant.” Services beyond Islamic finance law On top of these geographical constraints, financial markets are increasingly producing deals combing both conventional and Islamic aspects. Mr Marlière explained that they require two sets of expertise and multi-jurisdictional access. “Property-based lending, project finance and infrastructure projects require experience from true Islamic finance specialists,” he said. Another huge emerging market is opening up for I.F. specialised lawyers around the world: many states and governments are changing their regulatory environment to make it Islamic finance friendly. “Skilled lawyers should accompany the legislative process, as has been the base in France, Luxembourg or Spain,” observed Mr Marlière. He concluded: “Only local lawyers specialised in the specificities of Sharia law can achieve this.”

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People Moves

PEOPLE MOVES SYSCAP APPOINTS NEW CHIEF FINANCIAL OFFICER Syscap, the leading independent finance provider, has appointed Steven Dunne as its new Chief Financial Officer. The appointment will help manage next stage of Syscap’s growth. Steven Dunne joins from Credit Solutions, one of the UK’s Top 10 debt recovery and management agencies, where he recently helped lead the successful sale of the business to Arvato, the outsourcing division of German media giant Bertelsmann. Steven joined Credit Solutions as a non-executive director in 2005, in his role as Portfolio Director for ISIS EP the private equity backer of Credit Solutions, before becoming the company’s Finance Director in 2007. John Allbrook, Executive Chairman of Syscap, said: “Syscap’s finance team has done a great job in ensuring that we came out of the

credit crunch and recession in a far stronger position than our competitors. Both turnover and profitability are improving markedly.” “Steven’s appointment will ensure that we get the very best out of those growth opportunities that we are presented with. He’ll also help us to continue to pull away from our competitors in those areas where we excel like credit control and in building the funding capacity to help our customers.” “Steven has a great track record having helped to manage the profitable growth and sale of Credit Solutions – that experience of building and exploiting growth opportunities is something we are very keen on.” John Allbrook explained that Steven also brings with him corporate development experience from his time at a FTSE-250 listed company. Steven Dunne added: “Syscap is an ambitious company with a much respected management team and strong brand values, I am really excited to be joining them.” Steven originally qualified as an accountant with PricewaterhouseCoopers before joining HSBC Investment Bank.

HANNES SNELLMAN STOCKHOLM RECRUITS REAL ESTATE TRANSACTIONS TEAM Real Estate Transactions experts Safa Mahmoudi, Nimrod Badur and Caroline Englund join Hannes Snellman’s Stockholm office. By recruiting a dedicated real estate team in Stockholm, with Safa Mahmoudi, Nimrod Badur and Caroline Englund as core team members, Hannes Snellman further strengthens its Nordic real estate transactions capabilities. The recruitment of a real estate team in Stockholm is yet another strategic step for Hannes Snellman towards becoming the leading Nordic firm. Safa Mahmoudi, Nimrod Badur and Caroline Englund join Hannes Snellman from Cederquist, and have cutting-edge expertise and vast experience in real estate transactions, commercial tenancy law and property management agreements. Safa Mahmoudi will head the Real Estate practice in Stockholm,

which will be an integrated part of Hannes Snellman’s well established and highly regarded real estate teams in Helsinki, Moscow and St. Petersburg. “By recruiting Safa, Nimrod and Caroline, yet another important piece falls into place on our journey towards becoming the leading Nordic law firm, as explicitly set out in our strategy”, says Fredrik von Baumgarten, Managing Partner in Stockholm. “Hannes Snellman has numerous times succeeded in recruiting today’s best young lawyers with ambitions and capacity to be the stars of tomorrow, and the fact that we have yet again achieved this is very satisfying and proof of the strength of our strategy and of our capability to deliver cutting-edge expertise to our clients”, Fredrik von Baumgarten added.

ANASTASIA CHARBIN JOINS LECTRA AS MARKETING DIRECTOR, FASHION Lectra, the world leader in integrated technology solutions dedicated to industries using soft materials - textiles, leather, industrial fabrics, and composite materials, appointed Anastasia (Stacey) Charbin as Marketing Director, Fashion. This nomination follows Lectra’s recent announcement to accelerate growth and introduce major new products for the fashion industry over the next 18 months. Daniel Harari, Lectra CEO, said: “In the current post-crisis climate where positions can very quickly grow stronger or weaker, creativity and responsiveness combined with consistent quality have become key differentiators for fashion companies. “Fashion companies need improved teamwork and process flexibility. These are critical if they hope to take advantage of their own internal knowledge and work more effectively. This is why Lectra

has a particularly ambitious future: we are constantly developing our fashionspecific technology offer. “I have every confidence that Stacey will support Lectra in bringing improved solutions to our customers and to providing thought leadership to the industry as a whole.” “Caught between fluctuating costs and plummeting retail prices, now, more than ever, fashion companies need to control the development cycle and timeto-market which requires process re-alignment. Adjusting their business model requires reorganising the supply chain from concept and textile design to development to production. This transformation can only occur if there is a strong fashion-technology backbone to support the change. And this foundation can only be put into place with in-depth industry know-how and best-practice expertise, which only Lectra is capable of providing,” explained Stacey Charbin. “I am delighted to be part of this process. A strong strategy for change will enable our customers to be even more competitive while keeping pace with consumer preferences and a changing market.”

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CorporateINTL Special Focus

GE Capital GE Capital has acquired the UK accounts receivable financing subsidiary of Eurofactor S.A, a part of Credit Agricole Leasing and Factoring. The acquisition will assist in the growth of GE Capital’s UK commercial and corporate lending business and the company’s strategic focus on providing financial solutions to the UK’s SME community. This is a great opportunity for GE Capital to expand its customer base and offer the combined services of two businesses with strong risk management, due diligence, and invoice discounting expertise. This development provides additional options for European SMEs and mid-market groups that have been discouraged from borrowing due to trading conditions in the global economy. The takeover of Credit Agricole Commercial Finance UK follows GE Capital’s acquisition in 2010 of the French and German commercial financing divisions of Royal Bank of Scotland, and cements GE Capital’s position as one of the leading independent providers of AR finance in the UK.

Adam Johnson, Managing Director of GE Capital Corporate Structured Finance, explained the rational behind the acquisition: “There is currently widespread consolidation across the industry, and as an independent industry leader, GE Capital is naturally a big part of that. There is a dramatic growth focus within our organisation and a business development acquisition such as this is complementary to our organic growth. We have been expanding our ABL teams throughout 2011 with the recruitment of new frontline origination, underwriting and portfolio resource. These will complement the integration of the teams from Credit Agricole Commercial Finance UK and assist the GE Capital organisation as it strives for additional growth across the UK and Europe.” Credit Agricole Commercial Finance UK, formerly known as Eurofactor (UK) Limited, is a leading provider of accounts receivable (AR) finance in the UK and provided approximately £3 billion of finance to UK companies in volume terms in 2010. The company which bases its corporate strategy on the principle values of cohesion, openness, accountability and entrepreneurship will now contribute its strong reputation of customer service and loyalty as a commercial advantage on behalf of GE Capital. As for future acquisition led growth, GE Capital is frequently presented with a number of opportunities for expansion, all of which are carefully considered and reviewed by the organisation. However, this is just one component of GE Capital’s calculated growth strategy. GE Capital lends more than £4 billion in volume terms to UK SMEs through its AR finance business every year. The acquisition of Credit Agricole Commercial Finance UK will increase GE Capital’s lending to SMEs by more than 60%, supporting its position as one of the UK’s leading non-high street providers of AR finance. The existing services of Credit Agricole are complementary to GE Capital and now the organisation will spend time working hard to understand the finer points of the new business and ensure that every effort is made to maximise the capabilities and resources of both Credit Agricole Commercial Finance UK and GE Capital to drive bet-

ter growth for the overall organisation. “Our ambition is to grow both organically and through acquisitions over the next few years. We believe the Credit Agricole acquisition is great for our organisation in terms of the delivery of products and services as they have a large presence in the UK invoice discounting market. This acquisition will also give GE Capital extra distribution capabilities in places like Newcastle, Leeds and Reading, and of course enables us to provide services to a broader range of customers within our existing product offering,” commented Stephan Caron, UK Commercial Leader, of GE Capital. GE Capital is one of the leading providers of AR finance in Europe lending more than €250 million to small and medium sized European businesses every day and financing more than 350,000 companies every year in Europe alone. Since 2004, GE Capital has provided more than €350 billion of working capital to small and medium sized businesses across Europe. GE Capital operates at the very heart of European business. As the leading provider of working capital and asset finance, including acquisition finance, GE Capital provides a wide range of financial products and services to SMEs and multinationals in 16 European countries, with outstanding lending capabilities. Furthermore, GE’s industrial experience can go a long way to make customers’ assets work harder for their businesses. With operations in the UK since the 1930s, GE has seen accelerated growth of its business in the UK in recent years. The company has invested over £10 billion in UK business through acquisitions since 2002. Two of GE’s global headquarters are also based in the UK, GE Healthcare in Amersham and GE Money in London. GE now has more than 45 locations in the UK, including 25 manufacturing facilities. “GE Capital has had a presence in the UK for many years. The region is very attractive for the GE Capital model which is principally focused on the asset based and asset backed markets. The SME and Corporate segments within ABL are very important to GE Capital, and the organisation saw a natural regional growth opportunity that was compatible with

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Adam Johnson Managing Director GE Capital Corporate Structured Finance +44 (0)207 302 6300

the existing product set that the organisation has in place in the Americas. The wider UK market already had an invoice discounting and factoring business model, and most of wider Europe also operates a factoring based model, so there was always a natural attraction for GE Capital expanding into UK and Europe from the US. We have been firmly established here for a good few years now and we have cemented our position as the leading independent outside of the UK clearers in this asset based lending industry,” said Mr Caron. The organisation’s success and good reputation comes partly from the extremely thorough level of due diligence and management assessment that GE Capital conducts on every case. In turn, GE Capital sets high benchmarks in terms of the levels of return that are expected from investments and quantum of funding provided. “The markets have moved in such a way that there is an acceptance that there will be more due diligence in all deals these days. There is more rigour that goes in to underwriting transactions and there is an appreciation that banks need to be compensated for the increased importance in their role. There is clear evidence of a funding gap and a lot of banks have retrenched in the UK and Europe and this has created an opportunity for GE Capital in developing its existing relationships with pan European SMEs and Corporates, which will in turn play a material part in contributing to the global economy.” Mr Johnson added: “We believe that the SME’s contribution to the GDP of Europe is extremely significant. While in isolation SMEs seem to be

Stephan Caron, UK Commercial Leader GE Capital +44 (0)207 302 6300

small contributors, there is such a vast array of enterprises that fit into that segment that overall their contributions add up to be quite substantial.” The organisation is on track with its growth and expansion trajectory and will continue to develop throughout the remainder of 2011 and into 2012, with the short term goal of facilitating the smooth integration of Credit Agricole Commercial Finance UK’s commercial and portfolio teams and the

real world solutions. In terms of what has been achieved in 2011 thus far, Adam Johnson commented: “The first half of 2011 evidenced one of the busiest periods of new business activity for many years, covering M&A, turnaround, refinancing and working capital growth financing requirements. This activity has arisen from UK domestic, cross border and pan European opportunities covering a multitude of

“While in isolation SMEs seem to be small contributors, there is such a vast array of enterprises that fit into that segment that overall their contributions add up to be quite substantial.” streamlining of existing product and service lines. With the added resources of Credit Agricole Commercial Finance UK the organisation will continue its commitment to provide finance to SMEs which currently contribute more than 65% of Europe’s GDP. This acquisition extends GE Capital’s presence in this critical part of the economy at a time when many institutions are retrenching and demonstrates GE Capital’s support for European SMEs and Corporates in the form of capital and

sectors, including packaging, printing, pharmaceutical, distribution, aerospace, equipment hire and consumer goods, with funding requirements ranging from £1million to £300 million. One of the key challenges we face is to provide more pro-active education around the benefits of ABL and its suitability across a range of requirements covering not only domestic SMEs but also enterprises with more sophisticated, multi-tiered capital structures with access to the capital markets.”

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New trends & developments – China IP The KnowHow IP Group is an alliance of several Chinese firms including CN KnowHow Intellectual Property Agent Limited (a patent and trademark agency), a plant varieties agency, a Chinese law firm and Eagle IP Limited. The Group has expertise in a wide range of IP matters and maintains offices in Beijing and Hong Kong, as well as a representative office in the US. The Group’s Hong Kong office has four bilingual US registered patent agents in-house with knowledge of Chinese patent law. Shunxing Xie, president of CN KnowHow Intellectual Property Agent Limited, noted: “We are able to handle complicated Chinese patent cases with Western-type advocacy skills in the Chinese social and legal context. There are native Korean and Japanese speakers working within the group too. Such a combination enables us to provide one-stop services to clients within the whole of Asia.” As regards the group’s recent case studies, Dr. Jacqueline Lui , Managing Director of Eagle IP limited, added that since the Chinese legal system and the Chinese IP environment is quite different from that of Western jurisdictions, Western clients are beginning to recognise that they need a Chinese element in their IP strategy from the very beginning – not as an afterthought to their original IP focus. In particular, patent and trademark applications that are merely translated and filed in China after filing in the original home country often run into problems due to differences in the IP laws and practices between East and West. Therefore, more and more Western clients are now asking Eagle IP, the Hong Kong partner of the Group, to do original drafting and strategic management of their IP portfolio from the very beginning stage. The firm works closely with in-

Shunxing Xie, President Jacqueline Lui, Partner KnowHow IP Group +86-10-6219-6988

ventors, designers and in-house counsels to formulate suitable strategies. “For example,” said Dr. Lui, “a California-based multinational pharmaceutical company started by entrusted us to manage their entire Chinese patent portfolio with more than 30 applications. Now, they are running their new inventions by us before they file their priority US application – to make sure that that the priority application also complies with Chinese patent law.” Mr. Xie added: “China realises the importance of IP and has been encouraging indigenous invention and technology improvement via different means. At present, all levels of the Chinese government, from local to provincial to central levels, are encouraging IP procurement by subsidising the costs involved. Obviously, this move has facilitated domestic IP development, and China filed the largest number of patents and trademarks in the world in 2010. “With such national policies, foreign investors are reminded that they need to secure their IP appropriately in the face of ever-increasing competition – both in manufacturing and in market share. Bio and medical enterprises are comparatively more conscious about their IP than other sectors. They will start their IP protection from the very beginning of R&D, but are often hampered by limited financial resources. We are able to assist such clients in maximising protection at reasonable costs.”

Labour Law in Canada Ten years ago, Michael G. Sherrard and Erin R. Kuzz each left established law firms to create a new and forward-thinking, management-side, employment and labour law firm. With an entrepreneurial spirit and a belief that the traditional law firm approach to client service must be improved, Mr. Sherrard and Mr. Kuzz saw the opportunity to create a unique service provider. Their vision has been realised in the form of Sherrard Kuzz LLP, which has grown dramatically to become one of Canada’s most sought-after boutique employment and labour law firms. Located in Toronto, the firm represents every size and type of employer across the public and private sectors, nationally and internationally. The firm’s members spend considerable time – not billed – learning about each client’s priorities, objectives, industry, history and competitors. This detailed business knowledge enables firm members to advise clients proactively and strategically. The firm is also accessible – its live 24-hour telephone number is answered by a Sherrard Kuzz lawyer, 24 hours a day, seven days a week. According to Michael G. Sherrard, partner with the firm, a hallmark of the practice at Sherrard Kuzz is providing strategic employment and labour law advice to international employers commencing operations in Canada or carrying on business in multiple Canadian jurisdictions. Mr. Sherrard noted: “This is significant because, in Canada, employment and labour law are primarily regulated at the provincial level. Canada is comprised of ten provinces and three territories, each of which is responsible for its own employment and labour legislation. The Government of Canada is also responsible for passing laws relating to employment and labour in respect of particular industries regulated at the national level – including telecom, inter-provincial transport, air travel and rail.” Foreign businesses planning to develop operations in Canada must therefore expect employment and labour law in Canada to not only differ from

their home country, but also among the various Canadian jurisdictions, adding an additional level of complexity. Mr. Sherrard explained that a foreign organisation seeking to carry on business within one or more Canadian jurisdiction must therefore have a legal team that is highly knowledgeable about the wide range of provincial and Canadian laws that apply. For a large and growing number of foreign organisations, that team is Sherrard Kuzz LLP. “And yet,” said Mr. Sherrard, “despite what may appear to be a regulatory quagmire, Canada remains a very attractive place to do business. According to a detailed 10-month KMPG study of international business costs in 11 countries in North America, Europe and Asia-Pacific, Canada’s business costs are the second-lowest recorded in the study, and five per cent lower than in the USA.” He concluded: “Canada also leads all G7 countries in ease of doing business, according to the 2009 IMD World Competitiveness Yearbook; meanwhile, the Economic Intelligence Unit forecasts Canada as the #1 place to do business in the G7 for the next five years.”

Michael G. Sherrard, Partner Sherrard Kuzz LLP +1 416.603.0700 / +1 416.420.0738 (24-hour)

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The changing face of Indian IT industry The information technology sector in India has witnessed phenomenal growth in recent years. According to the World Bank, Indian IT sector has contributed 1.4% towards India’s GDP of the last financial year. Household consumer across income segments and geographies are being exposed to technology through mobile penetration and B2C applications (e.g. railway reservation, e-chaupal, e-Seva, e-tax return etc.). Further, recently introduced amendments in the Information Technology Act, 2000 (“Act”) are stepping stones to a robust IT legislation. Asim Abbas, partner at Khaitan & Co, noted that some of the key amendments to the legislation are incorporated in the rules framed under section 43A and 79(2) of the Act. He explained that the Information Technology (reasonable security practices and procedures and sensitive personal data or information) Rules, 2011 (“Security Rules”), framed under section 43A of the Act define “personal information”, “sensitive personal data or information” and “reasonable security practices and procedures”. “As per the Security Rules,” said Mr Abbas, “the corporate who coll ects, receives or stores ‘personal information’ or ‘sensitive personal data or information’ shall provide privacy policy for handling or dealing with such information and shall comply with reasonable security practices and procedures as provided therein. The Security Rules for sensitive personal data or information specify (i) the process of its collection and the disclosure of purpose; (ii) duration for which it can be retained; (iii) manner of disclosure of such information to third party; and (iv) level of protection to such information.” However, in view of recent clarification, issued by the Ministry of Communication and Information Technology, provisions relating to collection and disclosure of information under the Security Rules will not apply to any body corporate including BPO, if they are collecting sensitive personal data under contractual obligation with any legal entity located within or outside India. It further clarifies that provisions relating to collection and disclosure will apply to body corporate if it is providing services directly to data subjects under a contract. Mr Abbas added that the IT companies collecting such information have to put in place the systems and processes to comply with the requirements of the Security Rules. He further noted that the Information Technology (Intermediaries Guidelines) Rules, 2011 (“IR”) under section 79(2) of the Act, impose obligations on intermediaries to publish privacy policy or user agreement informing the users not to host, display, upload, modify, publish, and transmit certain categories of information as provided in the IR. “It mitigates risks and liability of intermediaries for any third party information or communication link made available by it. However, this will impact intermediaries as the added burden of fulfilling these provisions would add to their costs of carrying out their business,” commented Mr Abbas. As he explained, the IT (Guidelines for Cyber Café) Rules (“CCR”) are issued under section 79(2) of the IT Act. The CCR requires registration by all cyber cafes with the registration agency notified by the government. There are additional responsibilities on the cyber cafes to establish the identity of the user and maintain log registers to record the same. Cyber cafes may also be inspected by an officer to check compliance with the CCR. “It appears that such stringent CCR may hamper the growth of cyber cafes and as a result penetration of computer resource to public in general,” said Mr Abbas. “However, it has to be noted that cyber cafes have been mostly found to have been misused by terrorists, minors, hackers etc. for various purposes and therefore check on them was so desperately required to contain its misuse.”

Asim Abbas - Partner Khaitan & Co 801 Ashoka Estate 24 Barakhamba Road New Delhi 110 001, India T: +91 11 4151 5454 F: +91 11 4151 5318 E: Bangalore | Kolkata | Mumbai | New Delhi

The legislative changes in the IT Act are expected to affect multinational companies outsourcing business to India or operating in India. It is yet to be seen whether amendments to the Act and new rules framed thereunder will be considered to provide adequate protection within the meaning of Directive 95/46/EC to personal data transferred in India. “This outcome will definitely affect the Indian outsourcing industry and may prove to be beneficial for free flow of personal data to India in case they are recognised by The European Commission,” pointed out Mr Abbas. “Further, multinational corporations operating in India will have to comply with the requirements of the Security Rules.” The new rules allow officials and private citizens to demand that internet sites and service providers remove content they consider objectionable on the basis of a long list of criteria. The list of objectionable content includes anything that “threatens the unity, integrity, defense, security or sovereignty of India, friendly relations with foreign states or public order.” As this description is very vague, many think it undermines the constitutionality of the new rules, and could be seen as a threat to the freedom of speech in India. Mr Abbas noted that the fundamental right of freedom of speech and expression guaranteed by The Constitution of India is subject to reasonable restrictions. These reasonable restrictions are interest of sovereignty and integrity of India, security of the state, friendly relations with foreign states, public order, decency, morality or in relation to contempt of court, defamation or incitement to an offence. Consequently, the provision to remove objectionable content from websites under the IR is by large in consonance with the reasonable restrictions as stated above. However, Mr Abbas emphasised that some criteria specified in IR like “invasion of another’s privacy”, “relating to or encouraging money laundering”, or “communicates any information which is grossly offensive or menacing in nature” are vague and with no parameters defined. “The IR does not specify any authority who would determine whether the content complained of is objectionable in the absence of prescribed standards,” said Mr Abbas. Since these rules are new it is yet to be seen as to how the judiciary would interpret them in light of the constitution and reasonable restrictions contained therein. Mr Abbas commented: “With respect to the criteria specified in IR, which are not covered in Article 19(2) of the Constitution, there could be an arguable case that the new rules may infringe the right to freedom of speech and expression.”

“Multinational corporations operating in India will have to comply with the requirements of the Security Rules.”

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Japan pays increased attention to the inventive step judgment Tadashige Itoh President, Patent Attorney ITOH International Patent Office +81 (0)3 5424 2511

According to statistics published in 2010 by the Japan Patent Office (hereinafter, “JPO”), the average win rate in IP High Court decisions in lawsuits for revocation of the JPO appeal board’s final rejections are 13% in 2007, 18% in 2008, and 33% in 2009. Thus, the win rate is becoming significantly higher. It seems that the IP High Court is trying to modify the examination practice of the JPO so as to match it to the international inventive step standard. One IP High Court case in which the JPO lost is Heisei 20 (Gyo-ke) 10096. Tadashige

Further, in order to properly determine that the claimed invention could

Itoh, president at ITOH International Patent Office, explained that in this case a

have been easily invented, it is not sufficient to only show that it can be

requirement defined by Article 29, paragraph 2 of the Japanese Patent Law, is deter-

tempt to reach the technical features of the claimed invention. Instead, it is

general criterion was given by IP High Court on inventive step. The inventive step mined by considering whether or not a person skilled in the art could easily have

reached the technical features (features different from the cited main prior art) of the claimed invention, starting from the disclosure in the cited main prior art.

“Because the technical features of the claimed invention shall solve the

guessed or inferred that a person skilled in the art could have made an at-

necessary to show that a suggestion or motivation exists (in the main prior

art), based on which a person skilled in the art could have actually made an attempt to reach the technical features of the claimed invention.

“We can utilise this criterion in our argument against a JPO exam-

problem which the invention aims to solve, it is necessary to precisely grasp

iner’s inventive step rejection,” said Mr Itoh.

invention aims to solve,” commented Mr Itoh.

practicing intellectual property law as president, was established in

ysis or illogical thought must be excluded. To that end, it is necessary to pay attention

cal fields including the fields of automatic control systems, telecom-

the technical features of the claimed invention and the problem which the

He also noted that during the process of inventive step judgment, ex post facto anal-

not to allow “means for solution” or “result of solution” to be unconsciously included in the process when grasping the problem which the invention aims to solve.

Turkey: Real estate sector focus The primary source of Real Estate Law in Turkey is the Turkish Civil Code (the ‘Civil Code’), Chapter IV of which governs the issues surrounding rights and obligations in relation to property. The Civil Code describes and defines proprietorship rights, incorporeal rights, pledges on immovable property, while the secondary legislation governing real estate transactions are the Zoning Law, the Land Registry Law and the Cadastre Law. In transactions involving state-owned property, the Municipality Law and

ITOH International Patent Office, where Mr. Tad Itoh Jr. has been

December 1967. ITOH International is capable of handling all technimunications, semiconductors, information processing, computers, materials, chemistry, and biotechnology.

Turkey. For this reason, a Turkish subsidiary must be set up.

He said: “Also, as in most jurisdictions, proprietorship rights on a real

property are considered as a matter of public order in Turkey. Accordingly, any dispute in relation to a real property in Turkey must be resolved exclusively before the competent Turkish Court. A dispute regarding a real property cannot be resolved through arbitration.”

He concluded: “The way we see it, although the real estate sector in

Turkey has not been hit hard by the global economic crisis, it was rather

stalled during the crisis. However, it picked up pace quite quickly and is currently developing well.”

“As regards the coming months, the most commonly seen projects in

the Public Tender Law would also apply, where appropriate. Further, the new

major cities are likely to be hotel and private hospital developments. It

legislation for lease of immovable property.

tors. There is still, however, an over-supply in residential projects and

range of legal services to domestic and international companies, institutions

most significant change affecting the industry will be the entry into force

structuring a real estate related project in Turkey, one should always consider

rights and obligations to the parties of a lease agreement.”

Turkish Code of Obligations, yet to enter into force in July 2012, will be the key Kolcuoğlu Demirkan is a full service Istanbul-based law firm offering a wide

and individuals in various sectors. According to Serhan Koçaklı, partner, “while

seems that Istanbul in particular will be very popular for hotel inves-

a continued lack of A+ office spaces and trade centres. Meanwhile, the

of the new Turkish Code of Obligations in July 2012 – since it brings new

the fact that although the freedom of contract principle is well-respected under Turkish Law, the limitations of the above-mentioned laws may cause serious validity and enforceability problems for contracts.”

Kolcuoğlu’s lawyers are currently working on the acquisition of a landmark

property in Istanbul, from a bankrupt company. This transaction not only

includes significant real estate law practice with complex zoning law and tenant law aspects, it also involves Execution and Bankruptcy Law expertise, as the owner of the land is a bankrupt capital company.

Serhan Koçaklı, Partner Kolcuoğlu Demirkan +90 212 296 60 00

When asked about some of the complexities associated with real estate law in

cross-border issues, Mr. Koçaklı explained that the most important legal challenge

in cross-border issues is that foreign companies cannot directly acquire property in

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LGS on the forefront of dispute Hopes for increased M&A resolution in Indonesia activity in the Slovak Republic

Dr. Mohamed Idwan Ganie Managing Partner Lubis Ganie Surowidjojo Tel: +62 21 831 5005, 831 5025 Fax: +62 21 831 5035

Lubis Ganie Surowidjojo (“LGS”) is engaged in both commercial transactions and commercial litigation, including antitrust, arbitration and other alternative dispute resolution (“ADR”). LGS is one of the largest, if not the largest, law firm in Indonesia. In addition to having one of the largest commercial transaction practices in the country, among Indonesia’s main law firms LGS has the largest litigation practice. The firm has handled over 300 litigation cases over the last five years of its 25-year litigation practice history. Dr. Mohamed Idwan Ganie explained that in civil litigation (except for antitrust, trademark, labour, and certain other disputes) a mandatory mediation stage is imposed prior to the start of a hearing on the merits. He said that the mandatory mediation stage has in many cases resulted in amicable settlements. Statistics are not available and consequently it is not possible to determine as to whether this is having a significant impact on the level of litigation generally. In most cases efforts to come to an amicable settlement will precede any submission of formal litigation to the courts. Consequently, formal complaints will in most cases only be submitted where amicable out-of-court settlement efforts have failed. “However, in the mandatory mediation stage (after a formal court complaint has been submitted) professional/licensed mediators under the supervision of the court will conduct the mediation process, which in and of itself reopens the possibility that an amicable settlement can be reached even though previous attempts, prior to the submission of a formal complaint, have failed,” he added. Dr Ganie also noted that when it comes to mediation the client needs to be mindful of their counsel’s experience in the litigation sector. Dr Ganie said: “The client needs to have a realistic perception of their legal position and how Indonesian courts would decide the relevant legal issues, which can be best provided by an experienced litigation firm that also is experienced in commercial transactions.” Indeed, the client needs a law firm that applies the highest ethical and professional standards; and needs to have a realistic estimate of the legal fees that will be incurred in the process. Dr Ganie added: “Foreign clients, in particular, need to have a complete picture of the Indonesian litigation process, time periods, milestones and remedies available that might differ from the laws and procedures in their home jurisdiction.” Furthermore, the client needs to ensure that they will be involved, and obtain reports, on all stages and developments of the proceedings in order to issue instructions as and when needed. “The traditional approach adopted by Indonesian litigation firms was, and more often than not still is, that once the lawyer has been instructed, reports are very rare and the lawyer will act as he deems necessary based on his own discretion, and might as a result commit clients to legal liabilities without further, or confirming, instructions,” concluded Dr Ganie.

Deal activity in Slovakia over the course of this year could not be described as ‘dynamic’ or ‘robust’. For many businesses the main focus was not on acquisitions but on increasing portfolio of companies in order to secure growth and elimination of competitors. However, planned privatisation of certain sectors of Slovakia’s economy brings hopes for revived transactions activity. The government is also committed to ensuring business growth in less developed regions of the country. The planned privatisation includes state railway cargo company and 30-year rental of state owned airport in the capital city. In addition, a privatization of state owned heating companies is also expected. Commenting on the issue, Branislav Laurinc, partner at ECOVIS LA Partners Tax, said: “Privatisation is needed to get financial injection to the Slovak state budget. It means that at least in this area we could expect an increase in M&A activity.” As Mr Laurinc noted, the main sectors of the Slovak economy are automotive industry (three main automobile companies), steel production and production of electronics. Entities in these sectors have many companies connected to them as suppliers. However, during the global economic crisis the demand for products from the automotive industry, as well as steel and electronic products has decreased significantly. It adversely affected Slovakia with its productionand export-oriented economy. Nevertheless, after the recession, when the demand for such products increased again, the economy started to grow steadily. This improved the acquisitions market to a visible extent. According to Mr Laurinc, currently also the energy sector as well as agriculture and meat production are interesting areas for acquisitions in Slovakia. “We have also noticed an increased interest in environmental sector compared to the traditional sectors. On the other hand, the interests in acquisitions of service companies have been decreased,” said Mr Laurinc. As a result of the predicted start-up of the business growth, acquirers from outside Slovakia have shown a preliminary interest in domestic businesses, which is expected to result in future acquisitions. Most of the acquirers who have already started transactions were groups which are already present in Slovakia and their aim is to strengthen their growth or acquire their competitors, noted Mr Laurinc. The majority of investors was from Western Europe, particularly France, Denmark, Italy and Germany. The Slovak government is currently trying to attract even more investors into the country. Investors, both domestic and foreign, can receive state aid if they decide to invest in Slovakia’s less developed regions. Mr Laurinc explained that such aid could consist of, for instance, tax holiday or direct contributions to the investor for creating new employment positions. In the opinion of Mr Laurinc, the future of M&A activity in Slovakia will depend very much on the next development of the worldwide financial crisis which we are facing right now and a potential new crisis. He said: “Some time ago there were expectations for a growth in the business environment and, as a result, also in the M&A area. A new crisis could stop it altogether. However, on the other hand, the privatisation process may create opportunities which can significantly improve deal activity in Slovakia.”

Branislav Laurinc Partner ECOVIS LA Partners Tax +421 (0)2 33554160

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Mexico – Forensic Accounting Experts Jose Luis Rojas is a public accountant, currently acting as the managing partner of the Salles Sainz – Grant Thornton, S. C. office in Aguascalientes and Leon, where he coordinates all market efforts for five states within Central Mexico. He is also the partner in charge for Business Risk Services for Grant Thornton Mexico. With 23 years’ experience in control areas such as Internal and External

José Luis Rojas, Public Accountant Salles, Sainz – Grant Thornton, S.C. +52 449 996 62 60

Audit, Mr. Luis Rojas was part of a Deloitte strategic development pro-

gram in Phoenix, AZ as well as senior manager to the global audit director for Deloitte in New York City.

In addition, he is a specialist in prevention, detection and reporting of money

laundering and fraud, external and internal audit, risk management, and design and implementation of internal controls. He was also the subject matter expert for the Sarbanes Oxley Law implementation project in Deloitte Latin America, and he participated in multiple SOX readiness and attestation projects.

From 1998 to 2008, he was leading partner of the Money Laundering Preven-

tion practice for Deloitte Mexico and currently performs this function for Salles,

Sainz – Grant Thornton, S. C. As regards his sector experience, he has participated

crimes are increasing. Companies and their shareholders are very wor-

ried about these situations and so we have seen an increase in the need

for forensic services, training on the matter, and design and implementation of antifraud programs and controls.

“Corporate Governance standards in Mexico, meanwhile, are based on

in key projects in the financial services industry, such as design and implementa-

the Best Governance Practices Code issued by the Business Coordination

implementation of a money laundering and terrorism financing risk management

given that in reality it is policy without teeth. Notwithstanding that, based

tion of transactional matrix risk for customers in the financial sector; design and

system for 12 companies in Colombia; and design and delivery of a learning program for money laundering prevention for savings funds societies in Mexico.

Mr. Luis Rojas described Salles, Sainz – Grant Thornton, S.C.’s current client

base for forensic accounting services as “international companies with an interest

Council. However, this code is only a recommendation and is aspirational – on a corporate governance survey performed by Grant Thornton Mexico a

few months ago, we can see at least 64% of family-owned businesses moving towards institutionalisation – thereby, adopting the code.”

Mr. Luis Rojas also noted that the rise of new technologies has led

in monitoring their overseas operations and financial sector institutions.”

to an increase in document fraud, which creates the need for forensic

distinction of being the best auditor for the past two years in Europe. Also, our

and voice recognition patterns, among other areas.

He added: “Our firm is one of the top five accounting companies, and has the

professionals are bilingual and offer a high level of international expertise.”

As regards recent case studies, Mr. Luis Rojas said: “We are currently

working with a public company that is implementing its antifraud pro-

grams and controls according to the SOX Act, where we have discovered several small frauds due to lack of control, excessive confidence in em-

accountants to at least have a working knowledge of ID theft, forgery He concluded: “As far as 2012 is concerned, fraud will continue to

increase and companies will continue to improve their controls, some by

necessity, others by requirement of the markets where they compete – stock market regulations, banking requirements, applicable laws, etc.”

Mr. Luis Rojas is currently a member of the Association of Anti-

ployees and very little enforcement of the business policies.”

Money Laundering Certified Specialists and of the Association of Cer-

worldwide and nationwide has taken a toll in that the values of the society are

Bimbo, Kellogg Latinoamerica, Bansefi, Grupo Bachoco, Pilgrim’s

Looking at the industry as a whole, he said: “The current economic situation

put to the test and, unfortunately, fraud incidences, robbery, theft and other

tified Fraud Examiners. He has served many clients such as: Grupo Pride and AVON, among other prestigious brands.

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Availability of various forms of arbitration in Egypt Arbitration is a legal technique which allows for the resolution of disputes outside courts. In general, arbitration is related to investment - indeed when investment is rising, so is arbitration. As Ayman Abdallah, managing partner at AM Law Firm, pointed out, in Egypt arbitration is important and effective since the promulgation of Arbitration Law No. 27 of the year 1994. However, since then different types of arbitration have evolved in the country. Arbitration is often preferred to court litigation but also to other ADR methods like mediation. It is due to the fact arbitration is not only faster and discreet but it is biding too. Besides, a party can choose its arbitrators in case a dispute arises. Recently, a new kind of arbitration has appeared namely online arbitration. It means that companies do not need to go to an arbitration institution as they can submit the dispute to arbitrators online. “This new kind of arbitration

Ayman Abdallah Managing Partner AM Law Firm Mobile: +20100473700

shall be very useful nowadays as businesses all over the world use now the internet for work,” commented Mr Abdallah. Although arbitration has many advantages over litigation and other methods of ADR, it is also very expensive. Consequently it is suited, in most cases, for big companies rather than small ones. However, ad hoc arbitration is available for small companies or projects. In case of ad hoc arbitration companies agree on one arbitrator to settle their dispute.

Ad hoc arbitration is available for small companies or projects, where parties agree on one arbitrator to settle their dispute. The flexibility of arbitration makes it a commonly used technique for solving disputes. Therefore, Mr Abdallah expects that for companies arbitration will raise because the procedure is faster than going to court. He noted: “It seems that disputes handled under this method are more and more increasing, despite of the economic crisis. It is because various companies wish secret and quick resolution of disputes. Arbitration has risen especially since the recession.” According to Mr Abdallah, with regard to arbitration between two countries, in general, the biggest and more developed one wins the case because at the beginning, when the rules were written, they were favouring powerful countries. He said: “As we say in our country, ‘arbitration is like a car, it is fast but not safe’. Countries are going to limit arbitration, especially if the country is a party in a dispute. Actually some countries issued a resolution forbidding arbitration in the contract when the government is a party.”

IP advisers in the Netherlands Vondst Advocaten is a boutique law firm specialising in contentious IP work. The firm covers a full range of IP laws, ranging from patents to semiconductor rights and everything in between – including trademarks, designs and copyrights, etc. Tjeerd Overdijk, partner, noted: “We also represent overseas companies in conflict situations whether in legal proceedings or other contentious situations. Besides assisting our clients enforcing their IP rights and resisting enforcement actions, we have specific expertise as regards certain industries, including the IT, pharmaceutical and horticultural industries.” If a foreign business is contemplating the acquisition of assets or a business in the Netherlands which involves a transfer of IP rights, Vondst Advocaten can provide advice on the formalities that need to be complied with in order to accomplish a full and valid transfer of these rights (IP Due Diligence). Mr. Overdijk went on to explain that an important part in Vondst’s practice is its work for businesses specialised in breeding or exploiting plant material in the horticultural, fruit growing and seed industries. “Vondst advises businesses in these sectors about the possibilities available to protect the products they have developed and their breeding and horticultural methods, and about licensing and other types of exploitation agreements,” he said. Currently, Vondst Advocaten works for a wide range of clients, ranging from large automotive and pharmaceutical companies to small innovative healthcare and seed companies. Most recently, the firm has been involved in a number of high profile pharmaceutical and medical device cross-border patent litigations. As regards the industry in general, Mr. Overdijk noted: “Over the last 10 to 15 years there has been done a lot of harmonisation work to bring laws in line with EU standards. At the same time, our IP systems bear remnants of the old national or regional

laws which include some peculiarities that can be considered specific for our jurisdiction. For example, we have been used to grant a fairly broad protection to trademarks, and we still extend trademark protection against certain use of trademarks other than for distinguishing goods or services – if such use is damaging for the reputation of a trade mark, even if the mark is not well-known. “When it comes to copyright protection we have our own set of limitations and exceptions, which bear the marks of local culture with regard to what we in the Netherlands view as reasonable safeguards of the free flow of information. And obviously there are certain areas of IP law, such as the protection of trade names, which are not yet harmonised with laws throughout the UK – and which may set certain unexpected standards when operating a foreign business in the Netherlands. “This is why it will always be helpful to seek local IP advice when doing business in the Netherlands.”

Tjeerd Overdijk, Partner Vondst Advocaten +31 (0)20 504 20 00

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The importance of Family Courts in Singapore As cases relating to family issues are often very emotional, practitioners specialising in this area need compassion and people skills to assist their clients in an adequate manner. Matrimonial or family law in Singapore cover issues relating to marriage, divorce, division of assets, custody of children and access, maintenance and family violence. The most prevalent area of family law work in the country is divorce and issues that have to be resolved by the court following the divorce. Singapore has a specialist Family Court and an efficient system that stresses timelines with provision of counselling to parties on children’s issues. The Family Court also provides trained counselors/therapists who assist the judges by putting up custody evaluation reports, access reports etc. Courts also work closely with the Ministry of Community Development on contentious custody matters. Pursuant to recent legislative changes, Singapore courts now have the jurisdiction and power to recognise ancillary orders made in other countries and to enforce or supplement these orders. In recent years, the case load of the Family Court has increased significantly and as a result, the Family Court is dealing with more divorces and issues relating to divorces. Nevertheless, the efficiency and high standards of the system is maintained by the use of modern technology, the competent and highly trained staff and judicial officers. Court papers are filed electronically in court. Additionally, a number of cases are connected to the Family Court via video link by which status conferences and pre-trial conferences are conducted. Before a person may start legal proceeding for divorce in Singapore, there are certain requirements the person must satisfy. It is essential to first determine whether the Singapore Court has jurisdiction to grant the divorce. The Singapore Court is able to grant a divorce, judicial separation or nullify a marriage if one of the parties to the marriage is domiciled in Singapore at the commencement of the proceedings, or if one party has habitually resided in Singapore for three years before the start of court proceedings. This requirement applies to Singaporean citizens, permanent residents and foreigners residing in Singapore.

It does not matter that the marriage was solemnised and registered in a country other than Singapore. When it comes to resolving marital issues in Singapore, litigation and mediation are the most popular methods. Mediation is encouraged especially for issues involving children. Koh Tien Hua is a partner in the Family and Matrimionial Law Department of Harry Elias Partnership LLP and also a partner of the firm’s Sports and Media Practice. He has acted for high net worth individuals, successful entrepreneurs, and wealthy families in numerous matrimonial and family law disputes and has appeared in matrimonial cases from the Singapore Family Court to the Singapore Court of Appeal. Koh Tien Hua is a fellow of the International Academy of Matrimonial Lawyers, which membership is open only to family lawyers with experience in international disputes relating to maintenance, division of assets and children’s issues. He is also a member of the Family Law Committee of the Law Society of Singapore. He is the author of a book on matrimonial and family law entitled “Divorce – Untying the Knot”, a publication by Marshall Cavendish. Tien Hua is also an accredited Singapore Mediation Centre family law mediator involved in the Singapore Mediation Centre’s Family Law Mediation Pilot Project.

Koh Tien Hua Partner Harry Elias Partnership LLP +65 6361 9895

Issues surrounding IP legislation and litigation in Nigeria Given that Nigeria is party to TRIPS, Berne, Paris, Rome and the Patent Cooperation Treaty, Nigeria’s intellectual property regime is largely investor and creator friendly. Founded on English common law, the Trade Marks Act 1965 derives from the English Trade Marks Act, 1938, which means that the framework for geographical indications of origin and well-known marks are largely lacking but the common law action of passing off is preserved. As Dr. Bankole Sodipo, partner at Chief G.O.Sodipo & Co., noted, Nigeria has a Copyright Act, 1988 that largely meets with TRIPS’s minimum standards, and a Patents and Designs Act, 1970 that largely conforms to TRIPS minimum standards such as 20 years patent term and product patent protection for pharmaceuticals. Some infringements amount to crimes under a Counterfeit Drugs Act, a Merchandise Marks Act and the Copyright Act. However, unlike many neighbouring African countries, Nigeria is not party to the regional industrial property treaties either the OAPI (French speaking countries) or ARIPO (English speaking countries). Nigeria is also not party to the Madrid Protocol. Recently, there have been some significant developments in the IP legislation in Nigeria. Among other, the Trade Marks Registry has introduced regulations permitting the registration of service marks even though the Trade Marks Act has not been amended. Similarly, the Patents Registry has permitted the grant of patents in line with the Patent Cooperation Treaty despite the fact that the Patents and Designs Act has not been amended to permit the application of the treaty in Nigeria. The success or otherwise of cross-border intellectual property litigation in Nigeria depends on the cooperation between in-house counsel, external counsel, and the ingenuity of all concerned. According to Dr. Sodipo, strategy

is key. Contact in neighbouring countries may be valuable if there is need to fight a counterfeiting ring across Nigerian borders. “Whilst in-house Counsel may share experience and make strong suggestions, what works in some countries may not always work in Nigeria,” pointed out Dr. Sodipo. “What worked previously may not work now. The law on the books may be slightly different from those on the street, that is, how the law actually works or is applied.” Dr. Sodipo noted that there is often a choice of the administrative body to use for a particular anti-counterfeiting operation. He said: “In one situation, we advised on the use of the Customs Service with whom our firm had been involved with intensive training whilst the client insisted on the use of the Standards Organisation of Nigeria. Fortunately, client agreed with us and the results were astounding. Strangely, the customs with police powers of arrest and seizure and carrying ammunition, had an edge over the Standards Organisation who do not have police powers. Our firm has the added advantage that we consult for most of the administrative bodies, hence, this relationship often proofs useful in dealing with issues affecting our industry clients.”

Dr. Bankole Sodipo Partner Chief G.O.Sodipo & Co. +2348023198641

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India’s appetite for becoming a global M&A player In 2011 itself India’s inbound M&A volume surged to $23.4 billion with the United Kingdom emerging as the top acquirer into India with deals worth $15 billion, much more than the corresponding period last year, when the year-to-date inbound deal volume stood at $151 million. The other top acquirer nations into India, after the UK which was responsible for 64% of inbound M&As, are the United States (17%), Germany (6%), Japan (4%), and Denmark (3%) (Dealogic). Whilst year-on-year there has been an increase in the inbound M&A

volume in India this year, on a quarter-on-quarter basis there has been a significant decline, particularly in the last quarter, which could be

resulting from the uncertainty caused on account of the current market situation, the recent stand taken by SEBI on the Vedanta-Cairn deal for removal of the put and call options and preemption clauses to from the agreement, the Competition Commission of India now in place

regulating M&As (crossing specified threshold limits) in India. Despite this, India still remains an attractive destination for investors, given its positive growth rate of 7-8%.

Darius Udwadia, senior partner at Udwadia & Udeshi, on the future of

M&As in India stated: “I would expect to see a lot of activity in this area in the banking sector, with the new RBI guidelines expected to be in place, telecom, as also in transport infrastructure and logistics. Furthermore, there could be

more and more companies taking advantage in buying distressed assets outside India, so we can expect to see more of this as well.”

Mr Udwadia is of the opinion that the Government’s liberalisation policy

with regard to foreign investment, both inbound and outbound, has helped

in boosting M&A activity in India. He added: “Moreover, the buoyant Indian economy, extra cash with Indian corporates, government policies and newly found dynamism in Indian businessmen have all contributed to this new acquisition trend.”

Mr Udwadia pointed out that Indian companies are now also aggressively

looking at North American and European markets to spread their wings and

become global players, not only for increasing their functional competencies but also for global positioning.

International companies interested in M&A activity in India need to remem-

ber that may have to deal with regulatory hurdles, red tape, time taken in

obtaining governmental approvals, or tax issues raised which may deter foreign investors. The fact that litigation and arbitration proceedings in India are time consuming is another key challenge.

Udwadia & Udeshi has expertise in varied fields, such as corporate, litigation,

arbitration, tax, IP, and competition law. “We can offer a full and complete legal service in relation to any M&A transaction,” concluded Mr Udwadia.

Darius Udwadia Senior Partner Udwadia & Udeshi T: +91 022 22001400 F: +91 022 2200 1411

Outsourcing and IT developments in Australia Jeremy Szwider Managing Director Bespoke Law +61 (0) 418 988 212

Australia is in the process of developing one of the world’s most restrictive systems of internet censorship despite the landmark ruling in the recent iiNet case. According to Jeremy Szwider, legal expert and Managing Director of Australian firm Bespoke Law, the iiNet decision will inevitably have ramifications for hosting providers, content providers, online portals and of course, internet service providers. iiNet is Australia’s second largest ISP and was victorious against an alliance of film and television studios. In this case it was claimed that iiNet, as an ISP, allegedly allowed its customers to download film, TV and music illegally over their service. It was ruled that, as an ISP, iiNet was not responsible for what their users do with the services they provide them. “The iiNet case is currently on appeal to the High Court of Australia and there is some support in the Australian market and industry bodies for ISP’s to block certain content and to record the usage of internet users on a routine basis,” explained Mr Szwider. Bespoke Law is a virtual law firm providing a platform for a new third tier of the legal profession. Without real overheads, it operates as an “outsourced extension” to in-house legal departments and business units. It does this via an Outsourced In-House Counsel™ service and alternative fee arrangements. With its virtual platform Bespoke Law significantly reduces clients’ legal spend by approximately 30-50%. It also operates in a paperless environment. Mr Szwider further explained the reasons behind Bespoke Law’s expansion on to this new platform: “With the luxuries of technology and online applications, Bespoke Law fosters communication channels with clients that are superior to traditional law firms. In addition to emails, mobile devices and ipads, clients communicate with lawyers at Bespoke Law via Skype, twitter and instant messenger services. The boardroom concept is easily re-created with a mouse click.” Bespoke Law advises a range of clients including web-based businesses, entrepreneurs, telecommunications providers, technology companies and start-ups in relation to information technology, e-business, internet and intellectual property law. The firm is experienced in assisting with communications and IT outsourcing arrangements including advising on the full range of outsourcing opportunities. Following his General Counsel role at Carphone Warehouse (including an active role in its outsourcing, technology and ISP activities), Mr Szwider has continued his relationship with this UK FTSE 100 telco retailer and has acted for the Best Buy/Carphone Warehouse Group in relation to a master services and support arrangement with Research In Motion (Blackberry). Recently the firm assisted in the sale of Australian group-buying site Spreets to Yahoo!7 in January 2011 for AUD $40 million, despite the start-up only launching in April 2010. Jeremy Szwider, recently received a highly commended award in the Box-Breaker category of the 20111 Annual Lawyer’s Weekly Lawyer Awards. The award recognises innovation in the legal profession and singled out Szwider’s new business model as part of the fully serviced law firm, Bespoke Law. Despite this recognition Mr Szwider remains grounded and dedicated to maximising the efficiency of his firm: “The biggest challenge facing the practice of outsourcing is keeping up with demand and ensuring that the focus on reducing overheads and promoting efficiency remains paramount,” concluded Mr Szwider.

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Developments in UK Health and Safety Law

Gerard Forlin QC 2-3 Gray’s Inn Square +44 (0) 20 7242 4986

Guatemala – IP trends & developments Asensio, Barrios, Andrade & Asociados was established in 1975 by Julio Asensio Wunderlich and Jorge Asensio Aguirre. The firm’s partners prioritise quality, efficiency, security and responsibility, and maintain specialist departments for Corporate Law, Commercial Law, Labour Law, Notarial Services, Intellectual Property, Tax Law, Administrative Law, Civil Law and Litigation. Ignacio Andrade, senior partner, commented: “Our firm is consistent in

maintaining the highest ethical standards, and bringing the correct appreciation regarding the resolution of conflicts among our clients.”

The firm’s Intellectual and Industrial Property department began in

The provisional figure for the number of workers fatally injured in the UK for 2010/11 is 171, and corresponds to a rate of fatal injury of 0.6 per 100, 000 workers. This figure is 17% lower than the average for the past five years (205). In terms of the rate of fatal injuries, the latest figure of 0.6 per 100 000 workers is 14% lower than the five-year average rate of 0.7.

1985 and was set up by founding partner Jorge Asensio Aguirre to obtain

Gerard Forlin QC barrister of the firm 2-3 Gray’s Inn gave his analysis of the recent statistics: “Yes the numbers are dropping, but perhaps due to the current lower level of, for instance, construction there are lesser opportunities for fatalities at work as a result of the economic slowdown. On the other hand it is possible that employers and organisations are carrying out more preventative health and safety measures and taking the Corporate Manslaughter and Culpable Homicide Act 2007 and other relevant legislation more seriously. My inclination would be that the two factors could both have possibly had an affect on the statistics.” Recently the UK has seen the first conviction under the Health and Safety (Offences) Act 2008, which allows for the imprisonment of individuals convicted of certain health and safety offences. A Mr Dutton, the Health and Safety Manager of a metal distribution firm called South Essex Stockholders Ltd was given a four months term of imprisonment, suspended for two years. He pleaded guilty to one count under s.7 of the Health and Safety at Work Act 1974. Mr Dutton had asked a junior employee to bring him a can of chemical to use as an accelerant to burn debris in a skip. On pouring it in it exploded and seriously burned him. He spent over three months in hospital and required major skin grafts. Further developments to UK health and safety came In October 2010 when Lord Young, in partnership with the Prime Minister, published a report detailing how health and safety regulations needed to be stripped of bureaucracy and red tape in order to build a bigger and stronger society. The recommendations and proposed simplifications in this documentation cover a wide spectrum of health and safety matters and could potentially impact every corner of society. Mr Forlin, Lord Young and David Smith of Zurich Insurance’s broker division debated these issues in the Great Hall at the Chartered Institute of Insurers at a special forum shortly after the report was published. Mr Forlin stressed the importance of being thorough with such an investigative report and the significance of examining every possible outcome that amendments and modifications to existing systems could bring to people in all walks of life. “It’s quite like the game ‘Kerplunk’, when you start removing pieces from a structure you need to know the exact consequences of every action. You cannot dismantle a part without first understanding the reasons why it was put there in the first place. At what point is something vital and important pulled out and the marble drops to the bottom? The UK has one of the best low-fatality rates in the world and we need to make the necessary efforts to keep it that way,” concluded Mr Forlin.

positions to criminal actions, commercial actions to nullify and cancel

quick and professional results for clients at low cost. The Patents department was established in 1998 and has subsequently operated in patent

registrations as well as in patent litigation; meanwhile, the Trademarks

department was established in 1993. Trademark work encompasses optrademark registries, unfair trade actions, litigations related to copyright and trademark violations as well as other administrative, civil, commercial and constitutional remedies and proceedings related to trademarks and IP within the Guatemalan territory.

Guatemala is subject to the Interamerican Convention for the Protection

of Trademarks and Commerce as well as being part of the Paris Con-

vention, Berna Convention, Rome Convention, TRIPS, PCT, WPPT and

WCT among others. Mr. Andrade noted: “We celebrate a TLC (free trade

agreement) between the USA, all Central American Countries and the Dominican Republic which assists with cross border inquiries pertaining to trademark and IP. However, as with many other countries, the recession

resulting from the economic meltdown has decreased trademark and patents applications in general while increasing litigation in such matters.” In order to increase the firm’s client base and international scope, in

2001 Asensio, Barrios, Andrade & Asociados joined INTA, the International Trademark Association.

Mr. Andrade commented: “The opportunities for networking provided

by INTA have improved our international visibility as an IP firm, allow-

ing us to work with those countries with which Guatemala does not have formal relations. INTA has provided us with several opportunities to work with regional correspondent firms for regional registrations.”

Ignacio Andrade, Partner Asensio, Barrios, Andrade & Asociados +(502) 23318168

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Developments in Cyprus The independent law firm of Michael Kyprianou and Co LLC was originally founded by Michael Kyprianou, previously a member of the Cyprus Parliament and Chair of the House Committee of Commerce, Industry and Tourism.

Over the years the firm has grown and expanded to such an extent that

to issue and transfer the title deeds into the names of the firm’s clients

now, with a team of over 20 lawyers, it is classed as one of the largest in

thus enabling them to enjoy their properties without the worry of the

Cyprus. It is also one of the very few firms with fully fledged offices in all

developer going bankrupt or re-mortgaging the land.

three of the major cities of Nicosia, Limassol and Paphos. In September

Commenting on the current business environment in Cyprus, Mr

2009 the firm also began its operations in Greece with a fully fledged office

Savvides noted that it is very good from an investment and corporate

in a prestigious area of central Athens, as well as having representative of-

perspective, with the influx of Russians to the market.

fices in Dublin, Dubai, Lugano and BVI.

“We consider Cyprus to be very attractive to a considerable number of individuals and foreign investors due to a number of reasons,” said

The firm offers a wide range of services, including:

Savvides. “It has a favourable location at the crossroads of Europe, Asia, the Middle East and Africa, it is a full member of the European Union,

• Real Estate and Property in Cyprus

it has an excellent infrastructure, a high standard of legal, banking and accounting services, the continuing development of the island, the

• Title Deeds

extensive use of the English language, the excellent climate etc.”

• Cyprus Immigration Law

prus is a full member of the European Union and European Law is fully

According to Savvides, there are no specific legal complexities as Cyapplicable. However, he noted that a large majority of the firm’s clients • Testimony

are not resident in Cyprus, and this obviously causes logistical issues, which are mostly overcome by a notarised Power of Attorney.

• Criminal Law

Two of the most recent developments in Cyprus relate to the Title Deeds issue which has had consider able press coverage over an ex-

• Arbitration and Litigation

tended period of time. These relate to the Amnesty Law which enables owners to get their Title Deeds with certain conditions and the law sur-

• Corporate

rounding the Specific Performance. Mr Savvides concluded:

• Cyprus Tax and International Tax Planning

“We expect the firm to continue expanding and successfully representing our clients and winning their cases.”

• Maritime Law “The underlying principles of Michael Kyprianou and CO LLC are integrity, professionalism, transparency, independence, efficiency and dedication,” said Savvas Savvides, partner. “We aim to provide our clients with the best possible and cost effective system. “We continually strive for improvement and constantly seek to secure international affiliations which we believe enable our firm to meet the most demanding needs of our international clients who often require coordinated work over various jurisdictions.” The firm is also a member of the international law networks of Multilaw

Savvas Savvides Partner Michael Kyprianou and Co LLC (+357) 26 930800

and Work-Link for Law. In relation to the area of Title Deeds, Michael Kyprianou and Co LLC has managed to obtain Court Rulings against Developers ordering them

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Changing trends in IP International trade and arbitration expert – Indonesia law – France

Tony Budidjaja, Principal Budidjaja & Associates +62 21 520 1600

Granrut Avocats is a business law firm that brings together competent and experienced lawyers with unflinching ethics who help you to define your objectives, and determine the best legal strategy to meet them. A firm that looks to the future Proactivity and pragmatism are the two core principles that comprise the Granrut Avocats’ approach. Established in 1957 by Bernard du Granrut, a former president of the Paris Bar, for more than 50 years the firm has

cultivated the fundamental values of excellence, solidarity, respect and

Arbitration is increasingly popular and flourishing in Indonesia. In today’s globalised world, the use of arbitration is growing together with the internationalisation of the Indonesian economy. Particularly, arbitration is gaining acceptance in international commercial transactions. Parties to an international commercial transaction have a tendency to incorporate arbitration clauses in their contracts to avoid court

proceedings. Apparently, agreeing to have disputes resolved by arbitration is the obvious and usually inevitable solution for parties dealing

with Indonesian companies. In international commercial contracts, the parties often have no other option than to agree to arbitration to avoid court proceedings in any of the parties’ jurisdictions.

Indonesia has enacted a relatively pro-arbitration legislation. Al-

though the Indonesian Arbitration Law has independently evolved,

many issues which are fundamental for proper arbitration practice have been adopted by the Arbitration Law. The Arbitration Law limits or

excludes certain interventions by the courts. Furthermore, under the

Arbitration Law, the parties have complete freedom to choose ad hoc or institutional arbitration. Such decisions are left entirely to the parties

ethics. In addition, the quality of the firm’s processes is ISO 9001 certified. Granrut Avocats’ strong reputation for all kinds of litigation has always

been an asset of the firm; meanwhile, its 17 partners continue to further its continued growth. Granrut is also a founding member of an international network of law firms mainly based in continental Europe.

Granrut partner Jean Castelain presided the Paris Bar in 2010 and 2011.

Further, partner Jean Castelain chaired the Paris Bar in 2010 and 2011.

Last but not least, Granrut is recommended by Legal 500 and Chambers in most of its fields of activity.

Partner profile Richard Milchior has been a partner of the firm since 1 April 2005. His fields of work are IP, EC law, domestic competition law and pharmacy law.

Mr. Milchior began his career in 1979 with the firm Lafarge Flécheux

Ghestin, then with the firm Raoul Castelain from 1981 to 1982. He was

then a partner with Robert Collin & Associés from 1983 to 1995. He be-

came of counsel with Nauta Dutilh until 1999. In 2000, he was a partner in the firm Milchior Smilevitch. He is fluent in both French and in English. After graduating from the Paris IEP (Sciences Po) in 1977, Richard

Milchior turned towards law, with an honours degree in Private Law

to any dispute. Also, there are no prohibitions on parties choosing an

(Paris X Nanterre) in 1978, which he completed with an honours degree in

Indonesia, if the contract between the parties so provides.

in 1979, then obtained a postgraduate degree (DEA) in General Private

tion advice. Mainly these companies are dealing with foreign counter-

II) in 1981. In 1982, he obtained his Ph.D. on Copyright and the Common

and are caught up in a dispute with the counterparties.

dence (New York University).

international arbitration institution and conducting the arbitration in

There are varieties of clients who have come to us and sought arbitra-

parties. These companies are mainly involved in international trading

We were recently involved in an arbitration involving an Indonesian major

public shipping company against one of its creditors in SIAC (Singapore In-

ternational Arbitration Centre). The creditor had previously disclosed details of the arbitration to an Internet-based information source for investment

bankers. The disclosure meant that the shipping company suffered damages since some of its investors had withdrawn. The problem also arose since

Economic Science (Paris X Nanterre) in 1979. He was admitted to the bar Law (Paris II) and a postgraduate degree (DEA) in Criminal Law (Paris

Market, then, in 1983, he graduated as Master of Comparative JurispruAs regards case studies for Granrut, Mr. Milchior recently filed a case

with the Customs Authority on behalf of a foreign client in order to de-

fend its trademark rights in France. He is now following up on retention and trademark infringement proceedings following on from this case at the client’s designated representative.

SIAC rules clearly prohibit any party to disclose matters related to an arbitration, unless agreed by the counterparty or by the tribunal.

Budidjaja & Associates has wide experience in guiding clients through

complex trade rules and restrictions. We regularly help our overseas based clients overcome barriers to entry in foreign markets, such as defending

clients in trade cases brought against local court or arbitration. The recent

economic downturn does not overly affect our business. In fact, the practice

Richard Milchior, Partner Ganrut Advocats +33 (0) 1 53 43 15 15

has been in increasing demand from overseas as well as domestic clients.

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Hong Kong’s New Arbitration Ordinance Louise Barrington Principal Aculex + 852 6409 0356

2011 is an exciting year for arbitration in Hong Kong. The new Arbitration Ordinance (Cap 609) came into force in June, after a decade of debate. Domestic and international regimes are unified, although parties my “opt in” to certain elements which used to be in the old domestic regime. For example they may agree that they can go to the Hong Kong courts on a preliminary question of law or to appeal an award on a point of law. It abolishes the complex old numbering system, making specific references to the UNCITRAL Model Law and where Hong Kong has departed from it or added to it. It also deals with thorny issues such as confidentiality, multi-party arbitration and consolidation. The new ordinance adopts the 2006 Model Law amendments on tribunal ordered interim measures, and provides for a broad definition of the term “in writing”. It also continues the existing regime for enforcing awards between Hong Kong and Mainland China, not covered by the New York Convention. For ad hoc arbitration, the Hong Kong International Arbitration Centre remains the appointing authority in default of party choice or agreement, and will also decide whether one or three arbitrators should make up the tribunal. Some interesting decisions have just come from the Courts. The Court of Final Appeal’s June decision regarding the doctrine of absolute immunity of the assets of the Democratic Republic of Congo was recently confirmed by the Standing Committee of the NPC in Beijing. In July, Mr Justice Saunders of the Court of First Instance set aside an ICC tribunal’s award against a Taiwanese construction company, saying that where a procedural flaw exists, the court must consider whether the outcome of the arbitration might have been different without the error. In the same month, Mr Justice Saunders found an implied agreement that German law governed an arbitration agreement, despite its Shanghai seat, where applying Shanghai law would have invalidated the agreement. Hong Kong’s unique situation Since its “repatriation” to China in 1997, Hong Kong is a Chinese territory. It is however guaranteed its own independent legal system - developed during British rule - including its own courts. This unique “one country, two systems” situation makes Hong Kong an island of common law in mostly civil law Asia. It is an attractive arbitration venue for Chinese, as well as for foreign parties hesitant to arbitrate in China Mainland. And Hong Kong’s popularity is not limited to China-related matters; many arbitrations take place at the HKIAC, where neither party has any connection with Hong Kong or Mainland China. Aculex Aculex is a boutique firm specialising in all aspects of commercial dispute resolution: arbitration, mediation, advocacy and training. Its principal, Louise Barrington is qualified in Ontario, New York Bar and England. She has been part of the Hong Kong arbitration community since arriving in 1997 to open ICC’s first regional office outside Paris. “Unlike most international firms, Aculex is a minimalist organisation, with limited overhead and maximum flexibility. We take on smaller cases, under US$10 million, and for larger more complex cases we partner with larger firms,” commented Ms Barrington. Aside from offering advocacy services and sitting as arbitrator, Ms Barrington acts as discreet advisor to companies and to law firms dealing with international arbitration cases.

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Forensic Accounting in China & Hong Kong

PWC Forensic and Investigations Services In today’s increasingly complex business environment, executives face numerous challenges and risks - often when their companies can least afford to deal with them. PwC Forensic and Investigations Services are dedicated to meeting the challenges caused by fraud allegations, financial crimes and other irregularities. The team of experienced professionals is uniquely positioned to help clients recover lost funds, prevent further economic losses and maintain normal business operations. Portfolio of the group’s specialist services includes: Financial crime examinations. Where there are allegations or suspected incidents of misappropriation of company assets/funds, or where financial statements are fraudulent or misrepresented, PwC can conduct forensic analysis, fraud enquiry, asset tracing and recovery, and a review of internal control breakdowns. Regulatory compliance reviews. It is essential for companies to understand and comply with the Foreign Corrupt Practices Act (FCPA) and other anti-bribery legislation. PwC conducts FCPA and other anti-bribery reviews, carries out antimoney laundering services and handles compliance enquiries. Fraud risk management and fraud prevention. The team provides pro-active services to help organisations reduce fraud risk, improve process and comply with prevailing legislation. Forensic technology solutions. Experts at the firm can forensically image, secure and analyse electronic data from a host of computer systems including laptops

desktops, servers, PDAs and mobile phones. Using proprietary tools they can organise and examine large volumes of data typically found in the corporate environment. Dispute analysis and litigation support. Clients of the firm may be dealing across borders in different cultures and legal systems, as well as unfamiliar regulatory and accountability requirements. PwC can provide services for litigation and arbitration situations. Background research services. The group provides background research into companies and individuals in China to help clients manage regulatory and reputation risks, make better informed decisions, and pursue strategic opportunities with greater confidence. With a presence in Beijing, Hong Kong and Shanghai in China and offices in more than 40 other countries, PwC combines a global reach with dedicated local teams to serve various businesses. Whether working directly for corporate clients or for their appointed intermediaries, the group always brings to bear its reputation for independence and integrity while providing valuable advice on critical matters. PwC Forensic and Investigations Services group consists of the following members:

Brian McGinley is a PwC Forensic partner based in Beijing. He was formerly with the PricewaterhouseCoopers forensic team in the United Kingdom from 1998 to 2003, when Brian moved to the PwC forensic team in Hong Kong. Brian has been in Beijing since 2007. Brian advises multinational companies on anti-corruption and fraud risk considerations in China. He has advised on anti-corruption risks and remedies in proposed acquisitions and investments. His investigations experience includes securities fraud, alleged breaches of the United States Foreign Corrupt Practices Act, employee fraud, asset misappropriation, undisclosed related party transactions and financial statement fraud investigations. His commercial disputes expertise includes: loss of profits, breach of contract/warranty, business interruption claims, completion accounts, joint venture and valuations disputes. Brian advises intellectual property owners on compliance with license and distributor agreements. Brian McGinley Partner, Forensic Services

Office: +86 10 6533 2171 Email:

John Donker is the leader of PricewaterhouseCoopers’ Investigations & Forensic Services practice in China/Hong Kong and in the Asia Pacific Region. He is also a member of the firm’s global Forensic Services leadership team. His work involves carrying out forensic fact finding investigations, providing support to clients and their legal advisors involved in dispute or potential dispute situations and advising clients in the areas of remediation, compliance and fraud risk mitigation. John has over 25 years experience in Hong Kong, China and the United Kingdom working with PwC and its predecessor firms. Based in Hong Kong since 1992 he has gained extensive experience in complex financial investigations and litigation support including arbitration, major commercial litigation and criminal fraud cases across the Asia Pacific Region. John Donker Partner, Forensic Services

Office: +852 2289 2411 Email:

Steven L. Skalak works within the Advisory division of the Hong Kong and China firm of PwC. Prior to joining the Beijing office in December 2009, Steve was a partner in the Dispute Analysis & Investigations practice in New York. Steve has over 30 years of public accounting experience. He provides auditing, accounting, financial and investigative expertise to attorneys litigating or arbitrating disputes, defending regulatory inquiries or investigations, and conducting internal investigations. Steve served as both the Global and US Leader of the Corporate Investigations team which provides services in four basic areas - Forensic Accounting, Fraud Risks and Controls, Anti-Corruption and Bribery, and Securities Litigation. Steven L Skalak Partner, Forensic Services

In China, Steve has advised clients on disputes with joint venture partners, investigated employee fraud and impropriety, pursued related party transactions, and many more.

Office: +86 10 6533 2630

Jean Roux works within the Advisory division of the Hong Kong and China firm of PwC . Based in Shanghai, he has led the Forensic Services practice in Central China since July 2005. Jean started his career in South Africa and has specialised in forensic investigations since 1987. He has been involved in numerous investigations covering a wide variety of industries including financial services, retail, manufacturing and public sector organisations. With over 20 years of experience in forensic investigations, which includes 6 years experience in China, Jean has had a wide range of experience in investigations of corruption and fraud as well as giving advice about fraud and corruption prevention and remediation.

Jean Roux Partner, Forensic Services

His recent assignments include, but are not limited to, conducting numerous anti-corruption due diligence reviews on potential acquisition targets over a wide range of industries for clients from the US , Europe and the rest of the world.

Office: +86 21 61233988 Email:

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Corporate International caught up with PwC to get an insight into various issues surrounding forensic accounting practice in China and Hong Kong. Q: What has been the effect of the economic downturn in your jurisdiction with regard to forensic accounting? A: Post downturn we have seen a significant increase in demand for forensic accounting as issues that may not have been identified or fully addressed during the downturn have come out. Deal activity in China has resumed and with it demand for enhanced due diligence in respect of corruption and fraud. A significant issue that has gained more attention globally in the last 12 months relates to PRC companies listed on overseas markets, principally in the US, but also in Canada, Hong Kong and others. Many of these companies listed through back door listings, or reverse takeovers. Negative analyst coverage, often by short sellers questioning the legitimacy of these companies operations, has increased. Such coverage, which is often timed ahead of financial reporting deadlines, triggers a series of events, including auditors not signing off on accounts until an independent investigation has been conducted. Regulatory enquiries, class action lawsuits, de-listing all could follow. Q: How have you dealt with these issues in recent months? A: Our role as independent investigators on many of these cases has resulted in increased demand for investigators with experience in dealing with the issues which are brought up time and again. These issues include sales existence, undisclosed related party transactions, asset misappropriation, and so on. In addressing these issues we may have to deal with a whole range of challenges, including the risk of collusion between company management and their bankers, complex distribution channels and potentially fake documentation. All of this has led to confidence issues with Chinese companies listed on overseas markets. New investors are more cautious and new allegations are arising on a regular basis. We have also been approached by regulators to share our experiences and thoughts on such issues. Deal activity has increased and given more awareness of corruption and fraud risks, investors are looking for forensic input in the deal process, whether it be for anti-corruption due diligence, background checking or enhanced financial forensic due diligence. We are also seeing more disputes activity post downturn, with commercial disputes being heard in arbitration, increasingly in China, which require forensic accounting input. We are therefore seeing huge demand for forensic accountants in China post downturn and we expect this to continue. Q: As the financial crisis presented more opportunities for fraudulent crime, have you witnessed an increase in accounting control? A: We have, and especially in the area of fraudulent expense activities as this often relates to corruption issues. Many companies’ systems are focused principally around financial controls, which may not necessarily be sufficient to address corruption risk. This is an area of concern to many multinationals with China operations. Common issues exist with fake documentation, either in relation to contracts for purchases or services that do not exist, or for expenses for events that did not incur. Q: Could you tell us more about these fake documents? A: There is a black market in China for tax invoices, or “fapiao”. These are the principal documents to evidence proof of payment and they can be purchased on the street or from a vendor for around 3-5% of the face value. They are then submitted in support of expense claims in order to obtain cash. This is often part of a scheme by groups of employees and so the funds are pooled and bribes are paid out of the pool. The frequency and value of these issues can be significant and so companies are looking to how they can enhance their systems and controls to prevent these activities. Given the growth in China’s consumer market there are huge opportunities but also challenges, especially in ensuring controls keep pace with the growth. Q: How would you assess the effectiveness of controls? A: Much of the fraudulent activities we are seeing is driven by behaviour, for example by dominant management overriding controls. In China it is less culturally acceptable than in the West to challenge a boss’s authority and so this attitude weakens traditional system focused controls. This presents an issue when former privately owned companies have attracted foreign investment, for example private equity, joint ventures or even overseas listings. The company continues to be managed by the former owner and in the way they have always managed the business – as their own business. This approach does not work for the investor and often leads to conflicts of interest. Q: It is often believed that forensic accountancy is a countercyclical sector. Would you agree with this statement? A: Certain aspects of our work are connected with countercyclical activities, such as investigations related to insolvencies. There may also be more disputes in a downturn that lead to the demand for our services. Much of our work is however related to issues identified by auditors, whistleblowers and regulators. These activities are not necessarily connected to the economy. Here in China, with high levels of investment activity, increased global regulatory focus and a perception of investment risk in China, we are finding there is more demand than ever for more proactive forensic accounting input, such as anti-corruption or forensic due diligence, in particular from multinational companies. Another aspect to consider is that if a fraud is detected then, regardless of the economic cycle, it will need addressing in some way.

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Forensic Accounting in Brazil

Forensic Accounting in Brazil The Forensic Services practice of PwC Brazil has approximately 30 professionals with liaisons in each of its 16 regional offices throughout the country. The practice’s main strengths include: its highly skilled team with their various backgrounds and credentials; its agility in response and delivery; its US partner with nearly 20 years’ experience in forensics services; its diversity in academic, professional and multilingual areas; its integrated solutions; as well as its broad local and international network. The practice boasts the experience of forensics professionals from Brazil, Belgium, Ecuador and the US. According to Forensic Services partner Mona Clayton, the firm advises small local companies and large multinationals with operations in Brazil in a variety of industry segments, such as banking, insurance, pharmaceuticals, utilities, mining, consumer goods and manufacturing. Ms. Clayton said: “We provide regional solutions for our multinational clients, and coordinate cross-border work throughout South America and into Latin America via a range of reactive and proactive services.” A broad client base The firm’s clients may be local or inbound clients that need to react to whistleblower complaints or concerns, or that require an internal investigation. Brazilian companies may be using these types of services for the first time. Education is therefore required to help them understand the difference between forensic services and the capabilities of internal and external audits as well as local counsel. Clients may also be inbound clients that intend to invest in Brazil, and want to assess fraud/corruption risks and understand more about their future business partner. Conducting corporate intelligence, as well as performing anti-corruption assessments, is a service in high demand from multinationals and is, increasingly, a key consideration for local investors. Other examples of the firm’s client base are: technology companies that need help with software license compliance; law firms that need to help

their clients with the above matters; as well as clients that want to ensure compliance with local or international laws, such as the FCPA (Foreign Corrupt Practice Act) and the UK Bribery Act. PwC’s forensics practice is seeing increased interest in these latter areas following the recent implementation of the UK Bribery Act. Ms. Clayton noted: “Our practice has a well-established and consolidated network, allowing it to liaise with forensics professionals globally. This is seen by many as a distinct advantage. Also, as touched upon previously, PwC Brazil brought myself in as a US partner, to accelerate the development of its forensics practice in Brazil, as well as to leverage my global networking in this area.” Ms. Clayton’s experience and expertise has contributed to the rapid development of the practice in Brazil, and is a positive differentiator when compared to many of the firm’s competitors. She added that PwC Forensic Services’ success has enabled it to add nearly 25 people to the practice in the last two years.

Brazil´s economy showed a high degree of resilience during the economic downturn, and continues to see growth. She said: “On top of this, we hosted the first Brazil Summit on Anti-Corruption together with the American Conference Institute, and we speak frequently in the marketplace to large audiences and to audit committees – something that is effective in raising awareness within the market. “We also have a strong network of forensics professionals throughout Latin America, and we are partnering with one of the top universities in Brazil for a masters level course, teaching about the fundamentals of fraud awareness and investigative techniques. This course is one of the first of its

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Forensic Accounting in Brazil

Leonardo Lopes, Director, Forensic Services PricewaterhouseCoopers +55 (11) 3674 2562

kind in Brazil.” “However,” she said, “there is always room for improvement. We are continuing to invest in technology, education, language training and tools to improve delivery to bring value to our clients. We also invest in people by providing opportunities to work in other countries, or to bring others to Brazil to be part of the practice.” Future growth Brazil´s economy showed a high degree of resilience during the economic downturn, and continues to see growth. With inbound investment and increasing levels of compliance structures with local companies, the Forensic Services practice of PwC Brazil has seen a growing portfolio and its partners expect a repeat for the future. “The legal environment is sometimes complicated in Brazil, and there is an increased interest in international arbitration,” said Leonardo Lopes, director, Forensic Services. He added that at present, more fraud allegations are being reported and more internal investigations are being performed. Brazil is also attracting more foreign investors, and these investments can fix the focus squarely on transparency – something which demands local companies to increase their levels of professionalism and invest in better accounting controls. Regarding corporate governance standards in Brazil, Mr. Lopes said that Brazilian companies, with the exception of larger and listed companies, occasionally fail to comply with corruption or anti-bribery laws, including the Foreign Corrupt

Mona M. Clayton, Partner, Forensic Services PricewaterhouseCoopers +55 (11) 3674 2141

Practices Act. They may also have undisclosed off-balance sheet transactions and commitments, which can result in a loose application of accounting rules.

Brazil is predicted to be the fifth largest economy in a decade.

“Generally speaking, there is a low quality of historical financial information of businesses,” he said, “and this may not fully adhere to generally accepted accounting practices. A significant number of small and/or family-owned businesses may require investment in post-deal issues such as corporate governance, internal controls, integration of IT platforms and HR related matters.” “As the market is less mature, we do not see that this is having a significant impact on reducing fraud at this time,” he added. A unique market According to The Economist, Brazil is predicted to be the fifth largest economy in a decade. With pressures to produce results, combined with aggressive goals, this puts employees under pressure,

and may contribute to financial statement fraud as well as presenting opportunities to engage in conduct that increases the risk of corruption. Meanwhile, new technologies can be used both for good and bad purposes. Mr. Lopes said: “While we have been seeing many document frauds where information technology was used to produce fake documents, there are also new technologies that contribute to automated transactions and prevent these frauds from happening. Improvements in technology provide forensic accountants with tools to be more efficient, and also present challenges to stay current with the latest technology schemes.” PwC Brazil’s Global Economic Crime Survey results will be out in 2011, and further commentary can be provided at that point. For now though, Brazil´s GDP is the highest in Latin America, driven by its large and developed agricultural, mining, manufacturing and service sectors. The firm expects that there will be a strong demand – as the country is on a growth trajectory – particularly in those sectors. Ms. Clayton concluded: “Brazil is a unique market, and a different reality from the United States. One of the common mistakes we see is that companies send their internal auditors to Brazil to conduct an investigation where they do not speak or read the language, and do not understand local business practices. While internal auditors usually have a deep knowledge of the company, they may miss some obvious red flags – as the Brazilian reality may be outside of their experience.”

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IP in Mexico

Intellectual Property in Mexico Mauricio Jalife Senior Partner Jalife Caballero

Christian Thomae Junior Partner Jalife Caballero Tel: +52 (55) 5481 6999 Web:

Since the entry into force of NAFTA in 1994 and the accession of Mexico to the WTO in 1995, there has been an increasing consciousness about the importance of IP protection within Mexican companies, derived mainly from competitiveness and a higher offer of goods/services of foreign companies in Mexico as well as of Mexican companies abroad, which has increased the need of being IP aware and cautious. Additionally, given the current rates of counterfeiting in Mexico, both foreign and national companies have become more and more aware of the importance of fully protecting their IP rights in Mexico. Specifics of the IP legislation Mexico has quite a complete range of legislation in the IP field, providing protection for patents and trademarks (Industrial Property Law), copyright (Federal Copyright Law) and plant varieties, under UPOV (Federal Plant Varieties Law). However, there are some peculiarities in the Mexican system as regards certain international trends regarding protection in which Mexico has approached matters from a different standpoint. Mauricio Jalife, senior partner at Jalife Caballero, explained: “Under our legislation there is no opposition system for trademarks, meaning that once the Mexican Institute of Industrial Property has formally and substantially examined an application and determined the registrability of a mark, the said authority proceeds to grant registration and issue the corresponding certificate of registration.” Among some recent amendments to the Industrial Property Law and its Regulations, there have been some major developments as regards the deletion of the need of filing some documents related to trademark applications, such as a power of attorney and copies of priority documents. Christian Thomae, junior partner at Jalife Caballero, noted that on July 29, 2011, the Ministry of Treasury published the Foreign Trade Rules for the year 2011, which relate to IP. He said: “The rules allow trademark owners to record their Mexican trademark registrations at Mexican Customs. The said authority can watch for the owner’s mark in the import of merchandise into Mexico to detain any suspicious products and notify the trademark holder to initiate legal actions to achieve the seizure and prosecution of the case, either administratively or criminally. According to the amendments, this system will be implemented starting on January 2, 2012.” Professional competence Jalife Caballero offers a full range of IP services and is dedicated to and specialised in 100% in IP. Services of the firm range from trademark, patent, copyright and plant variety protection at an application and

registration/protection stage, to high-complexity services in the fields of IP litigation, advertising, entertainment, customs, pharmaceutical patent litigation, IP valuation and franchising. The firm offers specialisation and sophistication in all of the abovementioned areas. The firm possesses the experience and knowledge required to provide clients with a one-stop solution for protecting and enforcing their IP and related rights in Mexico. The firm has also a vast experience in cross-border IP protection, including the seizure of products at customs and parallel imports. Mr Jalife commented: “We have developed several tools that assist our clients in easing the way of their products through Customs, as well as detaining and seizing infringing products at the time of import into Mexico, within which is an in-depth, yet easy to understand expert opinion document regarding IP rights and the specific products that are indented to be imported to Mexico. It has now gained certain recognition by Customs Authorities, as to the precision and extent of the information and opinions it contains.” Expertise in parallel importing In the field of parallel imports, Jalife Caballero has gained specific experience and knowledge in representing both IP rights holders as well as importers in important and relevant cases that have set precedents in this field in Mexico. Some of the most relevant cases the firm has handled regarding parallel imports include one related to the clothing industry and a second one regarding the fashion industry, specifically sunglasses. Mr Thomae and Mr Jalife commented on the work. “In the first case our client, a renowned fashion designer with a full range of clothing products, acted against a major wholesale chain, for the sale of its products at the wholesaler’s stores. Even though, derived from the analysis of the products, these were found to be legitimate products, the problem was not really a matter of counterfeit products, but rather a problem of a conflict with the Mexican exclusive distributor of the mark for invasion of its territory. The case was attacked as trademark infringement and the wholesaler would have had to prove the entire chain of distribution of the products up to the trademark holder, in order for the MPTO to rule in its favour, including the need of disclosing all of the wholesaler’s sources for the products, as well as the source of the sources, which became complex and wholesaler was not willing to disclose these sources. The real intention of the trademark holder, knowing that the products were legitimate, was to find out which distributor in the U.S. had sold the goods for export to Mexico in breach of their distribution agreement and invading the Mexican distributor’s territory. The wholesaler was not able or was not willing to disclose documents (invoices) proving the entire chain of distribution of the products and therefore the MPTO ruled in favour of the trademark owner. “In the second case, a company specialised in sunglasses detected products at Mexican specialised stores which appeared to be 100% legitimate, but which had been sourced from an unknown party. In this specific case, all the components of the sunglasses, including manuals and their cases were original, but had been assembled, sold and exported to Mexico by a company that was not an authorised manufacturer of the products. In this case, the MPTO also found that there was trademark infringement, as not only the components should be analysed to deem if a product is legitimate or not, but also the assembly process for the same was not an authorised assembly plant.”

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GE CAPITAL Adam Johnson Managing Director GE Capital Corporate Structured Finance +44 (0)207 302 6300



Stephan Caron, UK Commercial Leader GE Capital +44 (0)207 302 6300

According to a recent Funding for Growth report published by GE Capital, SMEs in the UK are struggling in the face of high raw material and inventory costs. This was deemed to be the largest constraining factor on growth with 39% of SMEs citing it as the top limitation on their success, followed by fears about consumer and business spending, which was identified by 38% of SMEs as a limiting factor. In addition, the increased burden of regulation (36%) and, not surprisingly, the price of fuel (22%) were also cited by SMEs as being some of the significant worries. GE Capital lends £4 billion to SME businesses in the UK through AR finance every year. GE Capital enables over 90,000 customers in the UK to successfully run and manage their operations everyday. The organisation is the largest independent provider of commercial finance with major operations in asset-based lending, fleet management, distribution finance, equipment leasing and healthcare finance. In recent times SMEs and corporates across Europe have found it difficult to source the much needed funding required to grow and develop their existing enterprises. GE Capital is committed to delivering the necessary support to these businesses that some of their competitors are not. “A lot of products that are non-core for some of our competitors can sometimes be core to GE Capital. This gives us a great opportunity to expand our footprint in areas where other banks are scaling back, for example ABL funding to SME’s and the provision of specialised services such as fleet services” commented Stephan Caron, UK Commercial Leader.

“GE CAPITAL CAN OFFER CUSTOMERS ACCESS TO UNRIVALLED SPECIALIST INDUSTRY KNOWLEDGE. GE IS INDUSTRIAL AT HEART.” “The key opportunity for us is to play more aggressively by working with small and medium sized companies. We get our name out by helping these businesses and letting them know that we are an alternative to high street banks,” added Mr Caron. According to Adam Johnson, Managing Director of Corporate Structured Finance, GE Capital can help SMEs and corporates in these uncertain financial and economic times because of the structure of the organisation’s business model. “Our business model is based around asset based and asset backed finance, it is specifically targeted at a wide range of clients, whether it is those with small funding needs of £1million to those that require say £250 million in funding. GE Capital is very product focused, with a solution set that cuts across a wide territory. We put our capital to use to assist companies with a multitude of financing requirements covering turnaround, refinancing, acquisition finance, and those that have requirements for improved working capital facilities. We put our solutions to work over a multitude of areas and service the needs of

Adam Johnson

Stephan Caron

our clients and the demands of the markets at the time.” GE Capital’s ABL business is segmented into two parts. Firstly, there is the Commercial team focused on the UK regional markets and in particular the small end of SME’s. Secondly, there is the GE Capital Corporate team, of which Mr Johnson is Managing Director. This section of the ABL business focuses on both UK and Pan European enterprises, typically those with turnover in excess of £100 million, whilst the Commercial team focuses on enterprises with turnover of up to £100 million. This segmented differentiation is one of GE Capital’s key distinguishing factors that helps keep the organisation ahead of the competition and remain at the top of the ABL market. As a member of the General Electric family, GE Capital can offer customers access to unrivalled specialist industry knowledge. “GE is industrial at heart and has levels of expertise in a number of different sectors, we understand companies better than other banks. We can even go as far as to bring people from our global research centre onboard to help validate transactions and assist with due diligence. All this helps us make a truly informed decision about funding. We are certainly interconnected to our advantage,” said Mr Caron. “There are a number of global economic factors that we at GE Capital and the rest of the industry are currently facing head on. The general headwinds include the state of the equity and debt capital markets, potential sovereign debt risks, and increasing inflationary pressures,” explained Mr Johnson. In the long term, GE Capital will continue to harness the potential of all its resources and expand its capabilities and align its product offering in fulfilling the needs of a changing and volatile economic environment. The Funding for Growth report published by GE Capital is available online at: September 2011 Corporate INTL 31

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Phil Woodward, Managing Director, Leumi ABL + 44 (0) 1273 716200

Leumi ABL provides invoice finance, stock finance and plant and machinery finance, supported by trade finance and property finance facilities via their parent bank, Bank Leumi (UK). This year marks the fifth anniversary of the launch of Leumi ABL and the team has worked closely with dealmaking communities across the UK, earning a reputation for their flexible and highly personal approach to assisting business growth. Leumi ABL provides funding in the amount of £1m to £25m. Part of the Leumi ABL ethos is to work with a good quality management team and a good quality business plan that can offer a good quality product.

Ahead of the Competition Leumi ABL’s broad asset based lending product capability, which includes stock finance and plant and machinery finance, is a real differentiator in today’s market. By working together with Bank Leumi (UK), Leumi ABL have a market beating offering which has helped businesses across a wide range of sectors benefit from the group’s ability to put in place a jointly structured funding facility. “Clients choose us for a number of reasons. Because we are independent from the high street clearers, whom many customers continue to regard with some suspicion, we have greater flexibility, innovation and fleetness of foot. Unlike many independent lenders however, Leumi ABL has the financial strength and stability afforded by being part of a major international financial group which has been in operation for over one hundred years,” explained Phil Woodward, Managing Director of Leumi ABL. Leumi ABL was set up and is run by entrepreneurs. Both Paul Hird (CEO) and Phil Woodward have built businesses before, have the necessary experience and have faced the challenges that Leumi ABL’s clients currently face. The team spends time getting to know their clients and they focus on providing solutions that will give clients the confidence to exploit future growth potential. “Where speed is of the essence we can move quickly. Short decision making lines give certainty and fast credit approvals and continuing involvement of the senior team throughout the relationship contributes to an efficient process which is noted by clients and business introducers alike,” commented Mr Woodward.

International Plc. Their major customers include Dunelm Mill, Marks & Spencer and John Lewis. The eight-figure ABL deal, consisting of an invoice finance facility and stock finance, will help to strengthen Dawson Home Group’s competitive position. Brook Johnson who headed the MBI team, Brookmann Global Sourcing Group, commented: “We were impressed by Leumi’s entrepreneurial approach. Having worked on many bigger deals than this one outside the UK, it’s rare to come across the level of one-on-one attention that the Leumi ABL team put into this deal.”

Positive Outlook Asset based lending is increasingly seen as a versatile and predictable form of funding that can deliver much needed liquidity to growing businesses. Over the past year as businesses and their advisers have sought more innovative approaches to finance growth, there has been a greater awareness of the ability to use stock and machinery as solid collateral. Realising the value of those assets on the balance sheet as a valuable source of finance, Leumi ABL is seeing increasing numbers of proposals coming through from professional introducers for multi facility deals. “Despite the general mood of caution in the market, over the last few months we have been seeing greater confidence from our existing clients. They are beginning to grow turnover levels again and many are looking at expansion. “As increasing numbers of proposals continue to come through from corporate finance boutiques and venture capitalists for larger and more multi asset based deals, Leumi ABL is well placed to support businesses seeking flexible financing to fuel their growth plans from a provider they can trust. This, in combination with the increase in M&A activity we’re starting to see, creates some promising prospects for the remainder of 2011,” Mr Woodward concluded.

Dealmaking Experts In one recent deal, Leumi ABL has assisted the BIMBO (buy in management buy out) of Ash and Lacy Building Systems, a £30m turnover manufacturer and distributor of metal roofing and building envelope systems. Ash and Lacy has been bought by incoming management from former owner Hill and Smith Holdings Plc based in Solihull. Leumi ABL provided a total asset based lending package of £6.85m, comprising of a £5.75m invoice discounting facility, £0.75m stock finance plus £0.35m plant finance. Commenting on the financing deal with Leumi ABL, Jonathan Evans, Chief Executive at Ash and Lacy, said: “Despite a short timescale, Leumi reacted quickly and enthusiastically throughout. We felt convinced that we were working with people as committed and passionate about their business as we were about ours.” Another recent deal saw Leumi ABL support the management buy in of Manchester-based Dawson Home Group, a supplier of luxury home textile products including bed linen and towels, being sold by parent Dawson

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Leumi ABL Corporate International:Leumi ABL Corporate International



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You build the business. We’ll build the confidence. The flexibility and expertise of an independent, together with the strength and extended product range of its parent, Bank Leumi (UK) plc, make a winning combination. Specialising in structured ABL facilities up to £25m with exceptional levels of client service. Specialist manufacturing business required funding to support acquisition in aerospace industry. Leumi ABL provided

£3m CID facility

Manufacturer of metal roofing and building envelope systems required ABL package to support BIMBO. Leumi ABL provided

£5.75m CID facility + £0.75m stock finance + £0.35m plant finance To find out more about the Leumi ABL approach to business call Phil Woodward on 01273 716 200 or email or visit Brighton � London � Birmingham � Leeds � Manchester � Reading

ABL multi financial award winners 2010


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BIBBY FINANCIAL SERVICES Ed Rimmer UK Chief Executive +44 (0)151 479 7636

Bibby Financial Services, the UK’s largest independent invoice finance provider is currently providing tailored cash flow funding for nearly 4,000 businesses, handling an annual client turnover of more than £3.4 billion and advancing in the region of £342 million every year to help small and medium-sized firms grow and realise their potential. Ed Rimmer, UK Chief Executive of Bibby Financial Services commented on the importance of offering factoring and invoice discounting services in order to best help clients: “Invoice finance allows businesses to bridge the cash flow gap between raising an invoice and getting paid. Businesses using invoice finance receive an immediate cash injection and ongoing supply of working capital against the value of outstanding invoices. Firms can opt to retain the relationship with their customers and collect payments themselves through invoice discounting, or take advantage of the provider’s credit control services through factoring, saving valuable management time. Bibby Financial Services’ ability to listen to clients’ needs and tailor funding solutions to match their specific requirements makes the company first choice for firms at all stages of the business lifecycle, across a range of sectors and markets.” Excelling in the field With Bibby Financial Services, clients have access to invoice finance experts, who spend time getting to know their business and offer the benefit of their experience to make sure the most appropriate solution is provided to meet their needs. Fast, local decision-making through Bibby Financial Services’ network of 16 offices across the UK means the company’s efficiency in getting facilities in place and completing deals is second-to-none. Bibby Financial Services is proud to offer its services to sectors and business areas that may be finding it hard to acquire funding due to the current situations in the global financial markets. “We also offer a range of unique funding solutions aimed at markets who traditionally find it difficult to access funding, including construction, IT and international trade. Bibby Financial Services offers a broad spectrum of specialist finance products including invoice discounting, export factoring, business funding and trade finance and can assist customers with cash flow, bad debt protection, late payment, overseas trading, business start-ups, access to funds and purchasing and refinancing among other obstacles. Those obtaining funding from Bibby Financial Services also benefit from the security and peace of mind that the business is backed by a 200 year-old parent company, the Bibby Line Group,” commented Mr Rimmer. Exclusive services Since the economic downturn, architects have found it difficult to obtain bank funding. Banks have become less inclined to lend to construction professionals due largely to the weakness of the property sector. In response to this, Bibby Financial Services has expanded its unique construction finance product to develop a bespoke funding solution specifically for architect practices. With extensive experience in providing specialist finance solutions to construction firms, Bibby Financial Services is the only invoice financier to develop a product designed specifically to support architect practices seeking funding to improve cash flow and aid growth. “The confidential service allows architects to access funding tied-up in

project milestones under most standard forms of appointment as soon as they are achieved. This will address the industry’s challenge of waiting up to 60 days for certification and then potentially a further 30 days for payment,” said Mr Rimmer. All of Bibby Financial Services’ standard factoring services operate out of the local office and clients are allocated their own manager and credit controllers, who work closely with them to manage the service effectively. Solutions, such as recruitment and construction finance are managed out of specialist offices which have the appropriate experience and expertise to manage these tailor-made facilities effectively. Continued success In the six months to July, Bibby Financial Services saw a staggering 82% year-on-year increase in take-up of its factoring with bad debt protection services, , providing guarantees that companies will get paid, even in the event of customer insolvency or prolonged default on payment. Mr Rimmer shared his opinions on what the future had in store for Bibby Financial Services and expressed that in his view, there is no issue regarding the debt market being open for business for the remainder of this year: “Even if the European crisis continues and even if we move towards another recession, there is still enough money out there and I cannot see the markets drying up. There is a lot of negativity being talked about and reported but the reality is the banks do have large amounts of capital and they will not be able to hold on to that indefinitely. In these challenging times Bibby Financial Services is open for business and stands ready to help firms by providing funding and expertise to a variety of industry sectors.” Mr Rimmer concluded: “I am optimistic about the future of the debt market but there is a real issue in the mid-corporate area as there is a lot of money due to be refinanced between 2012 and 2013, and that is where there could be some real problems because that is where the risks are higher. Bibby Financial Services’ backing from Lloyds TSB Commercial Finance and Barclays will ensure we have the flexibility to be able to meet growing demand and take on more new business in the future.”

Ed Rimmer 34 Corporate INTL September 2011

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Factoring Invoice Discounting Construction Finance I.T. Finance Trade Finance

Your Invoice Finance Experts

Export Factoring Recruitment Finance

At Bibby Financial Services we invest time in understanding your client’s business and the challenges they face. Equipped with this knowledge we match our expert capability to their specif ic needs to create a tailored finance solution. This is backed up with direct access to decision makers so your clients get a facility in place quickly. With over 27 years experience we have an in-depth understanding of key industries and markets where invoice finance can be key to success.

Partner with Your Invoice Finance Experts to find the right funding solution for your clients. Call 0800 91 95 92 or visit September 2011 Corporate INTL 27

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02/09/2011 09:41


ALDERMORE Ian Wilkins Group Managing Director, Commercial Finance +44(0)161 238 5000

As the UK economy seems to be in a period of very slow growth, the British government and the EU is repeatedly marketing the important belief that smaller businesses will be the engines of growth and job creation in future recoveries. It is now more important than ever for SMEs to be able to source funding from organisations that have both the capital and industry experience to help drive economic growth. UK businesses are having a difficult time finding ongoing finance which is needed to grow but Aldermore is the bank that is able to provide an alternative source of cash flow finance through invoice discounting or factoring. These two funding facilities enable small and medium enterprises (SMEs) to choose what best suits their cash flow requirements and is the ideal choice for companies looking to fund growth and unlock cash that may be tied-up in outstanding invoices. In addition to offering confidential invoice discounting and invoice finance facilities, Aldermore provide bespoke debtor funding products to meet the specific requirements of each individual customer. Aldermore’s strength lies in its dedicated teams which focus on specialised industry areas. The teams apply their in-depth knowledge of the businesses the bank works with, in order to provide pro-active funding solutions to customers. Aldermore prides itself on high levels of service and a local knowledge of the marketplace and experience within a variety of industries. This knowledge is facilitated by the bank’s regional offices which are situated across the major economic centres in the UK.

“ALDERMORE’S FOCUS IS TO PROVIDE A CONSOLIDATED RANGE OF COMMERCIAL FINANCE PRODUCTS WHICH MEET THE NEEDS OF THE SME MARKET” Aldermore is a new British bank, which not only provides products and services to the consumer, but has a firm focus on the SME market. Aldermore’s Commercial Finance team is able to provide a finance suite of products for asset finance and commercial mortgages, as well as providing invoice finance to firms. Stalker’s Haulage, a company based in Cumbria, recently utilised this combined financing facility, and in doing so demonstrated the Bank’s ability to offer a complete and practical package. Similarly West Sussex based company Insulated Tools, combined invoice and a commercial mortgage to release vital cash flow for the business. This transaction proved the depth of Aldermore’s industry knowledge, as well as the Bank’s geographical spread. “The success of an SME is determined not only by its financial position but also its management. It is imperative for the business to have a clear strategy and a focused direction, supported by a strong strategic plan. It is also important that senior management understand the areas where the business can diversify and expand, as well as being able to identify its market penetration within the industry. Aldermore works closely with a company’s management team to allow us to not only assess a business’s current position, but to further understand its

ABL future aspirations and how we can help facilitate funding in order to ensure continued growth,” explained Ian Wilkins Group Managing Director of Commercial Finance for Aldermore. The bank’s dedicated team of underwriters ensure that decisions are consistent and quick. The fact that Aldermore has increased its funding range up to £12.5 million means the bank is in a strong position to continue to provide cash flow solutions to a range of British businesses. “Aldermore’s focus is to provide a consolidated range of commercial finance products which meet the needs of the SME market. We recognise the importance of allowing companies to concentrate on their core business, whilst providing funding through our straightforward and dynamic products which can all be found under one roof. We believe this combined funding approach is vital for SMEs and this continues to remain Aldermore’s key focus,” added Mr Wilkins. Aldermore’s Business Development Managers understand their local economy and the issues affecting businesses in their region, and as a result of having strong knowledge and expertise to provide tailored financial solutions to fit the businesses needs. Uniquely, customers have access to their client manager directly and at anytime of the day, and unlike other organisations Aldermore’s client manager to customer ratio is one 1:25 which allows the managers to work closely and on a daily basis with their customers to ensure they have the funding levels needed to drive their businesses forward. During the recent economic crisis the UK lost thousands of jobs and saw its economic position shrink considerably. With the assistance of banks like Aldermore, small and medium sized enterprises across the UK now have the chance to grow, develop and continue to provide important contributions to improving the UK’s economy. With adequate funding accompanied by the necessary guidance and expertise, SMEs can begin to make the important steps required to assist with UK, European and ultimately global recoveries.

Ian Wilkins - Group Managing Director, Commercial Finance 36 Corporate INTL September 2011

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plan K


New heights in trust Lean on someone you can trust to support you, someone who has reflected seriously on designing sophisticated financial reporting and fund services solutions. Call us for assistance or for more information: +352 46 61 11-3401 September 2011 Corporate INTL 33

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Funds in Luxembourg

The Association of the Luxembourg Fund Industry

Charles Muller

Deputy Director General +352 22 30 26 36

The Association of the Luxembourg Fund Industry (ALFI) is the official representative body for the Luxembourg investment fund industry and was set up in November 1988 to promote its development. Charles Muller, deputy director general, explained that the Luxembourg fund industry is essentially known for its UCITS funds comprising 85% of the assets under management. The Luxembourg fund industry was created with UCITS, almost 25 years ago, and is now the biggest fund industry in Europe, with market share of roughly 30%. “Our speciality compared to other countries is cross-border distribution,” said Mr Muller. “If you count all the funds that are sold in at least three countries, then we have a market share of 76% according to LIPPER statistics. Our industry is a cross-border industry, it has become a large industry, and the global players that want to distribute cross-border are established in Luxembourg.” Mr Muller added that a recent trend in the industry is the search for new geographical markets outside of Europe, such as Asia, the Middle East and Latin America. The traditional advantage of the Luxembourg fund industry is a first mover advantage, explained Mr Muller. When the first UCITS Directive came out, Luxembourg was the first country to implement the European regulation into law. Another important factor is the size of the industry and the amount of foreigners that it employs. The country has around 500,000 inhabitants, 44% of which are foreigners. In addition, there are roughly 140,000 workers who don’t live in Luxembourg but commute. “The Luxembourg economy and the Luxembourg fund centre are very much based on professionals coming from all over the world to work here,” explained Mr Muller. “They speak the languages of the distribution channels, so if you are looking for a place where you’ll find somebody speaking Italian, somebody speaking German, somebody speaking French, and, nowadays, somebody speaking Russian and Chinese, you have a good chance that you will find that in Luxembourg. That’s part of the attractiveness.” Commenting on the industry’s performance so far in 2011, Mr Muller noted that assets under management were at over EUR billion 2 184.000 in January, and the industry is at exactly the same point in June. “It has gone up, but it has gone down again due to the evolution of the markets,” explained Mr Muller. “The good news in this is that there have been roughly €45 billion of new money coming in. The fact that assets under management globally have not gone up is due to the fact that markets have gone down while the new money was coming in. There have been net inflows, and we had that also in 2009 and 2010 – we had more new investors buying Luxembourg funds than selling them. That’s a trend we’ve seen over the last two and a half years.” According to Mr Muller, the impact of the Foreign Account Tax Compliance Act (FATCA) will depend on how it is implemented. If the strictest interpretation is enforced, there will be significant changes to how the European fund industry

distributes its funds. “Luxembourg domiciled funds are distributed worldwide, and the international distributors are holding the information about the clients,” commented Mr Muller. “They should know if it’s an American tax payer or not. If all this information has to be sent to Luxembourg to be sent afterwards to US authorities, then that will have a huge impact. If we can find a more workable solution then obviously the impact will be less great. At the moment we have 27 international changes of regulation on our radar screens that might affect our industry, and the FATCA is a significant one.” Mr Muller explained that, as with the UCITS Directive, which Luxembourg was the first to implement, the country is eager to be amongst the first to implement the Alternative Investment Fund Manager Directive (AIFMD). He stated that this is because Luxembourg is currently seen very much as a UCITS centre, but wishes to make itself known in the alternative sphere. “We will try to implement the directive quickly and in a very business orientated way in order to attract alternative investment fund managers who want or need to be AIFMD compliant to Luxembourg,” said Mr Muller. “We as an association, but also our government, are working on the implementation of the directive in order to be ready as quickly as possible.” According to Mr Muller, the most significant business trend since the financial crisis is an increase in interest from investors for funds that not only give a financial return, but also give another sort of return, such as socially responsible funds that invest in green elements, Islamic finance, and micro finance. Beyond the implementation of UCITS V and AIFMD, one of ALFI’s most important current goals is to open new geographical markets, particularly the BRIC countries. “For the moment UCITS funds are only accepted for distribution in a very limited way in the BRIC countries,” explained Mr Muller. “We are trying to find ways to convince the authorities in those countries to accept the distribution of UCITS funds. The same goes for Australia, which is a big market that we are targeting at the moment.” Looking to the future, Mr Muller’s main hope is that the current crisis will calm down and that the current high volume on new regulation will slow. “Constantly implementing new regulations is an effort that is not bringing investors, and it’s not bringing the industry any benefits,” he concluded.

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Funds in Luxembourg

Banque de Luxembourg

Fernand Reiners

Member of the Management Committee Head of Professional Banking Services +352 49924 -2518

Banque de Luxembourg was founded in 1920 and is one of the major financial institutions in Luxembourg. Its three core business areas are wealth management – where it advises wealthy individuals, families and entrepreneurs – asset management and services for asset managers – in particular for initiators of investment funds. Banque de Luxembourg has been in the investment fund business for more than 30 years. As such, the fund business is a strategic activity at the bank. It proposes comprehensive services for third party fund initiators, including legal advice and structuring, custody and transactional services, central administration (via its subsidiary European Fund Administration) and domiciliation services. Its offering also includes its UCITS IV Management Company, Conventum Asset Management, as well as several hosting structures. In addition to these services, the bank also coordinates the registration process of the fund in a large number of countries. Its clients can thus concentrate on the asset management and distribution aspects of their products. Coming from a private banking background, the bank seeks to establish lasting personal relationships with third party fund promoters. In many cases, the bank has grown its business over a long period of time alongside its client’s. “In terms of service, our approach is both comprehensive and personalised,” commented Fernand Reiners, member of the management committee and head of professional banking services. “As opposed to larger players, we seek to offer a more tailor-made approach. “Fund promoters, independent asset managers and insurance companies may develop their entire business activity with us or opt for selected services.” Mr Reiners explained that the bank’s conditions for success lie in focusing on customers with whom it shares a similar vision regarding their profession. “In many cases, our success stories come from other private banks or midsized asset managers,” he said. “What sets them apart is their focus on the development of longstanding client relationships and their prudent approach in investment management. They do not venture into products with little transparency, nor do they invest in companies or sectors because they are ‘trendy’.” Luxembourg is the second largest investment fund centre in the world. However, according to Mr Reiners, the success of the country as a distribution hub has not proven sufficient to extend its branding in the area of fund management. He added that investment firms usually object that Luxembourg is not a major European financial centre like London, and does not provide the same levels of access to brokers, traders, exchanges and “plain old market gossip”. “We on the contrary sincerely do believe that it is a perfect place for asset management and fund management too. In Luxembourg, asset managers will not be caught up in the hubbub of major financial centres and will thus be able to focus on the investment process and the fundamentals of the markets.” For international investors, Mr Reiners believes that having their investments managed out of Luxembourg confers the advantage that it is likely to lead to greater diversification in their portfolios. Whereas investment firms in the larger European countries tend to focus mainly on domestic assets, Luxembourg’s

investors have, through necessity, a long experience of investing outside its borders. “Our asset management company Banque de Luxembourg Investments (BLI) is proving day by day that doing asset management out of Luxembourg is not only possible, but that it can be done quite successfully, as numerous international awards have proven,” said Mr Reiners. In recent years, private equity has taken a growing place as an asset class in the portfolios of investors seeking innovative products with attractive opportunities for return. Mr Reiners explained that, for the last two years, the bank has noted increasing activity from certain major players in this market, private and public alike, and new ambitious projects have been launched. “Our teams, specialised in setting up investment vehicles, are seeing fresh interest in venture capital, private equity and real-estate funds,” commented Mr Reiners. “The sectors these vehicles invest in are both diverse and highly specific, ranging from hotels and retail buildings, mezzanine and subordinated debt, renewable energies and energy efficiency, to microfinance, social enterprises, as well as investments in specific assets such as art, boats and retirement homes.” Investment vehicles such as the SICAR (risk capital investment company) and SIF (Specialised Investment Funds), created in Luxembourg in 2004 and 2007, have been met with increasing success. The figures speak for themselves: at end December 2010, the number of SICARs had risen to 247 (+30% in two years), while the number of SIFs increased to 1,192 (+70% over two years). “Thanks to their on-shore status, the SICAR and the SIF offer promoters access to an internationally renowned financial centre located at the heart of the European Union,” said Mr Reiners. “Subject to less stringent legislation, these vehicles meet current demand for increased transparency striking a sound balance between reporting needs and supervision requirements, while guaranteeing the flexibility required in private equity operations, all of which are particularly relevant when raising capital. “The SICAR and the SIF also offer a high level of operational flexibility and a choice of legal and tax structuring options via variable capital or multiple sub-fund structures. Both vehicles also benefit from an explicit consolidation exemption and de facto neutral taxation, which represent substantial cost savings.”

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Funds in Luxembourg

BNP Paribas Securities Services Luxembourg

Yvan de Laurentis

Global Deputy and Luxembourg Head of DepoBank +352 26 96 23 21

The Luxembourg funds industry is “dynamic, adaptive and well-positioned for the coming challenges” according to Yvan de Laurentis of BNP Paribas Securities Services. As an example, he noted that it was the first country to implement Ucits IV back in December 2010. Almost simultaneously, the CSSF, the Luxembourg regulator, issued two circulars to clarify some new requirements. “The Luxembourg practitioners encompassing fund promoters, banks, service providers as well as legal and audit firms are also active via ALFI, the Association of the Luxembourg Industry to anticipate and work on those new requirements,” explained Mr de Laurentis. Luxembourg is already known and recognised for the servicing and administration of offshore domiciled funds, such as Cayman and British Virgin Islands funds. Fund administration and transfer agency, as well as custodian functions are carried out in Luxembourg, whereas the domiciliation and investment management are executed abroad. According to Mr de Laurentis, the key advantages of the Luxembourg market place are its reputation as a fund domicile; the strong concentration and the quality of its funds expertise for all types of the services; the multilingual and multicultural client servicing; and the adaptability/flexibility of the Luxembourg actors to new products and market trends. This includes the service providers, the legal and tax advisers and also the CSSF, all of which remain accessible. “Besides this ‘internalised’ market, Luxembourg has also created its own regulatory framework to host Luxembourg domiciled alternative investment funds, namely the successful SIF (Specialised Investment Fund) structure,” explained Mr de Laurentis. “This vehicle allows a large spectrum of asset types in a ‘lightly’ regulated form dedicated to eligible investors (minimum investment €125,000).” Commenting on 2011 for the Luxembourg funds industry, Mr de Laurentis described it as “hectic and challenging.” He explained that the regulatory agenda is competing with unusual and significant market events. “Indeed, we have major challenges coming into effect in 2011 such as Ucits IV with its sets of measures from the key investor information document (KIID) production to the reinforcement of the risk management process and the new cross-border master-feeder structures. At the same time, another critical battle is raging on the lobbying side for the alternative investment sector – the alternative investment fund managers (AIFM) directive.” Mr de Laurentis also noted other initiatives such as Fatca, Solvency II, DoddFrank and EMIR for the OTC derivatives markets and TARGET2-Securities. He believes that from a commercial perspective the first half year was positive with some new fund launches, even if the sector was affected by the Japanese

Tsunami and the Greek debt crisis. “Now the markets are again becoming extremely volatile subsequent to the downgrade of the US rating by Standard and Poor’s. It is difficult to say how this will end; in any case, we live in interesting times!” Commenting on the Fatca tax law, Mr de Laurentis noted that it will immediately trigger millions of development costs for the industry, mainly for banks to be compliant and to avoid the 30% penalty on all transactions. “All entities impacted are assessing and reviewing their actual models to identify the budget and resources required for this measure, which has been imposed on Luxembourg, and over which the country has no control. In parallel, some fund promoters may review their distribution channels and restructure their product offering to ring-fence the perimeter of products subject to Fatca, and thus prevent fiscal contagion from reaching the entire fund range.” AIFM will regulate all non-Ucits structures and create a level-playing field across all EU member states. The alternative fund managers will be subject to new rules and constraints in terms of organisation, risk management and remuneration. The depositories will also be greatly impacted by new measures relative to their duties and their liability regime. They have raised numerous questions since the issuance of the first draft, and responses are expected by September 13, 2011.Level 2 measures are not published yet and are expected by year end or beginning of next year. Luxembourg will participate through its market representation body, ALFI, as most of the global players will contribute on a corporate and individual basis. The experts have been busy during the summer analysing and answering questions and proposed options (relative to their duties and their liability regime). “The regulatory process being still under discussion, the industry is closely following the position taken by other jurisdictions and foreign supervisory bodies to better anticipate the key trends,” commented Mr de Laurentis. He concluded: “We anticipate an increase of funds entering the perimeter of supervision of depositary banks, which are actually offshore funds, serviced by a Luxembourg-domiciled custodian and the potential relocation of either fund domiciles or of the funds providers.”

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Funds in Luxembourg

Private Equity at Ernst & Young Luxembourg

Alain Kinsch

Country Managing Partner, Luxembourg EMEIA Private Equity Fund Leader Tel: +352 42 124 8355 E-mail:

Private Equity plays a major role at Ernst & Young Luxembourg: With over 100 professionals fully and exclusively dedicated to Private Equity, Ernst & Young has the largest and leading Private Equity practice on the local market providing audit, advisory, tax, transactions and valuation services to the industry. While servicing most of the world’s largest Private Equity firms, the local Ernst & Young practice also works with hundreds small and medium-sized general partners around the globe. Set-up in 2004 under the leadership of Alain Kinsch, today Managing Partner of the Luxembourg office and EMEIA Private Equity Fund Leader, the Ernst & Young Private Equity practice is a leading tax advisor in the local market and provides the highest market share in the audit of Luxembourg Private Equity funds and structures: 47% of all SICARs (‘invest-

entiating factor in servicing investment structures with a global reach on investor and investment level.The current award to Ernst & Young Luxembourg as “Private Equity Advisory Firm of the Year 2011 in Luxembourg” goes in line with further, globally recognized titles that previously have been awarded to the firm and that all together add clear proof to Ernst & Young’s unrivaled, leading position within the Private Equity industry. The current award particularly builds on the award as “Private Equity Advisory Firm of the Year 2011 in Europe.” Ernst & Young Luxembourg is a key supporter to the Private Equity industry both in Luxembourg and abroad. The Ernst & Young Private Equity practice has been instrumental in the design of the SICAR law and is one of the founding members of the Luxembourg Private Equity Association (LPEA), which aims at representing and promoting Private Equity and Venture Capital locally as well as globally. Furthermore, Ernst & Young Luxembourg actively supports Private Equity industry associations such as ALFI, the EVCA and LPEA in their contribution to the drafting of the Alternative Investment Fund Managers

Ernst & Young Luxembourg set-up the first and so far the sole fully specialized Private Equity advisory team that has led the most significant Private Equity advisory engagements in the local market.

ment company in risk capital’), measured by size, are audited by Ernst & Young. Furthermore, Ernst & Young Luxembourg set-up the first and so far the sole fully specialized Private Equity advisory team that has led the most significant Private Equity advisory engagements in the local market. A key differentiating factor of Ernst & Young is that professionals in the Private Equity practice specialize in Private Equity starting in their first year and quickly develop in-depth knowledge in the industry through a specific training curriculum and dedication to a diverse range of Private Equity clients. The Luxembourg office is fully part of a global integrated network: In 2008, Ernst & Young brought together 87 practices and 66,000 people to create EMEIA (Europe, the Middle East, India and Africa). Worth to be stated, that Ernst & Young EMEIA is the worldwide market leader in servicing Private Equity. No other professional services firm has achieved this level of integration which can be considered a clear differ-

(AIFM) Directive. Building on a strong track record in Private Equity since many years, the current environment of regulatory change has put Luxembourg increasingly into the focus of Private Equity firms as a domicile of choice and has indeed been identified as one of the primary jurisdictions for redomiciling (unregulated) off-shore funds. In the specific context of the AIFM Directive, Ernst & Young assists custodians, administrators and general partners in a strategic review of their business platform and in an operational alignment with the upcoming requirements of the Directive. The Luxembourg Private Equity practice looks forward to further working with service providers and general partners, locally and abroad.

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Funds in Luxembourg


Arnaud Bon

Head of Fund Services +352 466111 3401

SGG is one of the leading and oldest independent fund and corporate administrators in Luxembourg. Over the last 60 years, SGG has always adapted to the evolutions of the Luxembourg market. With the development of a dedicated legislative and regulatory framework for alternative funds in Luxembourg in the early 2000’s, SGG took the opportunity to offer new innovative services in line with the experience and expertise of its staff. “SGG is privately owned,” said Arnaud Bon, head of SGG Fund Services. “Therefore, our clients know that the advice and service we provide are truly independent. Our shareholding structure also allowed the company to have sufficient means to grow and achieve its ambition: Excellence in all the services we offer. SGG teams up with most of the major law firms locally and abroad to provide seamless services to the industry”. With 3.2% GDP growth and a 6.5% unemployment rate (figures for 2010), the Grand Duchy of Luxembourg is one of the very few countries that showed a strong stability through the economic turmoil and the financial crisis. “Moreover, Luxembourg has been implementing new policies over the last years to diversify its sources of growth in non-financial sectors such as high-tech companies, telecommunication, etc.” commented Mr Bon. “This contributes to real stability”. Mr Bon explained that the fund industry in Luxembourg developed in several stages. After the boom of the UCITS¹ funds in the 90’s, Luxembourg built up a strong expertise in the field of alternative investment funds; first real estate funds, now private equity and hedge funds. Each time, this progressive development enabled the Luxembourg professionals – and their clients – to benefit from the experience gained on the previous wave. “Ultimately, as Luxembourg UCITS became a worldwide brand and Specialised Investment Funds (SIF) are recognised abroad as a quality certificate, we expect to continue the same growth pattern once the AIFM² Directive is implemented in the Grand Duchy,” added Mr Bon. With more than 60 double tax treaties in force, the Grand Duchy has followed the trend for greater tax transparency. Mr Bon stated that this, combined with the pragmatism of the Luxembourg tax administration, enables Luxembourg to have a leading role in terms both of investment vehicles but also structuring of special purpose vehicles for real estate and private equity investments. “Tax efficiency is one of the reasons clients decide to set up funds in Luxembourg,” noted Mr Bon. “But the main reasons are more of a legal and regulatory nature. Indeed, with the UCITS, SIF and the Investment Company in Risk Captial (SICAR) regimes, Luxembourg managed to offer fund promoters flexibility, legal safety and efficiency. A Luxembourg fund means, for numerous investors in the alternative world, an increased level of security”. ¹ UCITS: “Undertaking for Collective Investment in Transferable Securities ² AIFM: Alternative Investment Fund Manager

“In addition, the responsiveness of the Commission de Surveillance du Secteur Financier (CSSF), the Luxembourg regulator, is also a great competitive edge allowing Luxembourg to seriously compete with jurisdictions where the regulator plays a very limited role. Finally, as previously mentioned, Luxembourg benefits from highly experienced, multilingual and skilled professionals, located in the centre of Europe.” Commenting on the performance of the industry so far in 2011, Mr Bon noted that the official figures are positive. Between June 2010 and June 2011, the assets under administration in Luxembourg have increased by 8.67% to amount to EUR 2,185 billion. “In addition, we have witnessed for the last 12 months an increasing interest for Luxembourg among the private equity community,” observed Mr Bon. This is mainly due to the AIFM Directive and the already existing legal framework which will require very few amendments.” According to Mr Bon, Luxembourg has welcomed the AIFM Directive with great interest. He explained that the industry has been working hard, both at regulator level and at the level of professional associations, to make the implementation process as smooth as possible. “The already well established and recognised UCITS framework will, for sure, be a great asset for Luxembourg to be among the first jurisdictions to implement the AIFM Directive in a pragmatic and efficient way,” said Mr Bon. “For instance, the Government already introduced a bill of law to amend the SIF legislation.” Except for the changes to come with the AIFM Directive, Mr Bon believes that the Luxembourg legal and regulatory framework is very stable. There are some adjustments initiated on specific issues by the regulator. For instance, the CSSF has reinforced over the last 12 months its policy on anti-money laundering issues. Concluding with his predictions for the rest of the year and into 2012, Mr Bon stated that so far the figures, both for Luxembourg and for SGG, have been excellent. “The industry will definitely be affected by the sovereign debt crisis” he said. “However we expect a sustainable interest in Luxembourg as a financial centre. Regarding the AIFM Directive, by the end of 2012 we will already see very clearly where Luxembourg stands in the implementation process.”

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Funds in Luxembourg

UBS (Luxembourg) S.A.

Hermann Kranz

Managing Director, Head Asset Servicing EMEA

UBS has been present in Luxembourg since 1973. Today, the bank is organized around three main business pillars: Wealth Management, Asset Servicing and the Service Hub. UBS is one of the leaders in the Wealth Management market and has a strong focus on the UHNW segment. The Service Hub groups all services (Operations, IT and Portfolio Management) and offers them to other UBS entities across Europe, such as Belgium, Netherlands, Ireland, Austria, Spain, Poland etc. UBS’ Asset Servicing offering comprises of Fund Services, Custody, Lending, Cash & Payment Services, Performance & Risk Analytics, Investment Accounting and Execution & Brokerage. It offers the full panel of services with regards to investment funds such as conception and structuring, fund accounting, evaluation and reporting etc. This to enable its clients to setup and distribute the funds according to their needs. As part of a global powerhouse it offers traditional and alternative products. Besides Luxembourg, UBS is present in fund centres like Switzerland, Dublin, Cayman Islands, Toronto, Jersey, Hong Kong and Singapore. Hermann Kranz, Managing Director, Head Asset Servicing EMEA, explained that Luxembourg’s stable and attractive framework and its favourable tax regime has enabled the development of a highly renowned and competitive cluster for the fund industry since the 1980s. Today, Luxembourg ranks as the second largest fund centre behind the Unites States, with assets of almost €2,185 billion under management by the end of June 2011. According to Mr Kranz, the key success factors are UCITS (Undertakings for Collective Investment Transferable Securities) products, as well as SIFs (Specialised Investment Funds). “These innovations from a structure point of view position Luxembourg as the largest global distribution centre for investment funds in Europe in a leading position also globally,” explained Mr Kranz. “Especially within the EU the ‘passported’ UCITS have enabled this development and help the industry further leverage competitive advantages. “The consistently increasing number of UCIs (Undertakings for Collective Investments) (reaching 3,749 by the end of June) and the number of compartments clearly underline the competency. The early transposition of UCITS IV, as well as the innovative power of the industry cluster domiciled in Luxembourg and the continuous development of the industry underline this and make Luxembourg a seminal fund domicile.” During the first 7 months of 2011 the Luxembourg fund sector grew by 1.75% by number of units and even by 2.24% by number of funds. Clearly, Mr Kranz noted, assets are suffering from the current market turbulences. “The competitive situation gets harder under these circumstances and small competitors went out of the market,” he commented. “With our integrated Asset Servicing offering, UBS is also in these times ideally positioned to offer full services from a single source. UBS’ offering is appreciated by clients and allows us to differentiate ourselves in less favourable conditions.” According to Mr Kranz, the requirements of the US Foreign Account Tax Compliance Act (FATCA) represent a major challenge and concern for fund promoters worldwide. “It is not far short of the mark to say that all investors globally are US persons for FATCA purposes unless the fund promoter can demonstrate the contrary,” he explained. “Current fund operating models will require fundamental changes to identify and report investors.” Mr Kranz believes that it is essential for fund promoters and their service providers to start adapting processes. IT system capabilities, third party agreements

and fund documentation need to be adapted. “How they will meet requirements of this new regime is still to be determined,” added Mr Kranz. “It is however clear that FATCA represents a competitive opportunity for service providers with flexible and adaptable systems and processes.” Commenting on the impact of the AIFM Directive, Mr Kranz noted that Luxembourg is already known to be a domicile of choice in the alternative investment space with an attractive legal framework allowing large scope of structuring possibilities. This is proven by EFAMA’s statistics highlighting Luxembourg as the number two domicile for non-UCITS funds in Europe. Mr Kranz explained that Luxembourg traditionally sees change in regulation more as an opportunity than a burden, such as the first UCITS directive from 1985 and UCITS IV in 2010 – which Luxembourg was the first European country to implement. He stated that the Luxembourg legislator is aware of the importance of the investment management industry for the country’s economic success, and is already taking the first steps to adapt the existing regulatory framework to AIFMD requirements. “In this respect, a draft bill of law amending the framework for specialised investment funds (SIF), the most relevant Luxembourg non-UCITS investment vehicle, has been issued on 1st July 2011, the same day actually that the AIFMD has officially been published in the Official Journal of the European Union,” commented Mr Kranz. “The draft bill, which is planned to be implemented within this year, replicates certain AIFMD requirements, such as delegation or risk management rules, while leaving flexibility for legislative fine-tuning for the still highly discussed AIFMD topics, such as the role of the custodian and the rules on equivalent treatment for non-EU structures, for final implementation date of the Directive in 2013.” Mr Kranz believes that this proactive legislative behaviour together with the active involvement of ALFI, association of the Luxembourg fund industry, in the consultation process as ESMA level, proves that AIFMD is seen as a key opportunity for the industry and is treated with utmost importance by the Luxembourg market. Mr Kranz explained that Luxembourg is embedded in the global financial universe and is not an isolated market. Although the rest of the year will be challenging for the financial sector and the fund industry in Luxembourg, he believes that the outlook remains positive. “The market situation has lead to a lower asset base,” he observed. “However, Luxembourg remains well positioned thanks to its number of structures and advantages and has the correct platform to enable further growth. UBS went through significant transformation in the last two years in order to set the right basis for growth and we expect UBS to play an increasing role in the financial landscape of Luxembourg.”

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Offshore Joint Venture Companies The use of holding companies in a low tax jurisdiction is an effective method of reducing taxes and helping your business to operate more efficiently. This structure can work equally well to encompass a joint venture operation, a single operational entity or an investment company, although the rules for the jurisdiction of choice may be different. The choice of jurisdiction is of great importance when deciding on a tax minimisation strategy. The rates of corporate tax are important, but this must be assessed against variants such as how much income is derived from overseas, and how much income is passive investment or active business income. Tax treaties can also be an important consideration when choosing a jurisdiction to base a joint venture or holding company. An effective tax treaty allows for reduced withholding taxes, as well as income tax exemptions in certain circumstances for investment income to be received and/or business profits to be earned from one treaty jurisdiction by a company resident in another treaty partner country. Beyond tax considerations, the jurisdiction of choice must also provide a stable political and regulatory environment, and a corporate governance system that allows flexibility as regards corporate decision making and the distribution of profits and dividends.

Tax considerations Jurisdictions often have several types of corporate vehicle that can be used for this purpose, and each may have different benefits depending on the corporate structure. For example, Barbados is a stable Caribbean jurisdiction that has a domestic tax law featuring both low-tax rate companies for foreign sourced inbound investment, and/ or business income and withholding tax exemptions for outbound dividends to foreign shareholders. Capital share redemptions and re-purchases of a Barbados company can be made tax-free. The Barbados International Business Company (IBC) is generally used with investment holding companies and is exempt from withholding taxes on all inbound investment income (dividends, interest, rents, royalties etc) and on outbound payments to nonresidents including shareholders. Its statutory income tax rate ranges from 2.5% - 1% depending on the level of assessable income. Zero income tax is paid by a Barbados IBC if it is wholly-owned by a socalled ‘offshore bank trust’ that is managed by an offshore bank licensed in Barbados and deals exclusively in buying, selling, holding or managing securities – a structure normally used for investment holding companies based in Barbados. Meanwhile, Switzerland is a stable European jurisdiction that has, historically, been a popular place to locate a joint venture or holding company. In a Swiss corporate vehicle, dividend income, as well as capital gains income on the sale of shares, is tax exempt. Other types of income, including interest income and royalty income of a Swiss joint venture holding company, are taxed at an effective rate of 7.85%. Further, there is no domestic Swiss withholding tax on royalties or interest (on loans) paid by the Swiss joint venture holding company.

Cayman Islands - KRyS Global TM


Timothy Le Cornu, Director +1 345 947 4700

Complex Issues. Resolved.

KRyS Global is a professional services firm committed to resolving complex cross-border issues in the areas of corporate recovery, insolvency, forensic accounting and business advisory services. The firm maintains more than 40 professionals who work from offices in four jurisdictions. Each office has a team of independent, dedicated and experienced professionals with practical expertise, global experience and the ability to provide objective, sound advice. KRyS Global also provides dedicated insolvency, liquidation, corporate recovery, forensic accounting and related services, which enable it to specialise in independent, focused services for clients. The firm’s hands-on approach ensures that clients receive answers and remedies specifically tailored to meet their demands. When asked to describe the Cayman Islands’ corporate governance regime – i.e. any challenges encountered when dissolving a joint venture (JV) – Timothy Le Cornu, director, noted that dissolving exempt companies is not difficult, and various options exist. He explained: “One can have the company removed from the companies register upon providing declarations from the directors that the liabilities of the entity have been paid. Alternatively, the members of the entity can voluntarily wind up the entity. “This is a relatively inexpensive and straightforward mechanism to dissolve a company in circumstances where it is solvent, and assets are distributed on pre-agreed terms.” He added that in those cases where KRyS Global has been involved in winding up joint ventures, the JV companies have been used in highly capital intensive industries where pooling resources overcomes the difficulties that one entity may face in financing projects or acquisitions alone – particularly in the mining sector.

“In other cases we have been involved in, a Cayman Islands entity may be established as a holding company for a group with operations in one or more countries,” he said. “These companies borrow from a JV partner, banks and financial institutions or bond holders, to fund expansion and acquisitions, particularly in emerging economies. Usually, the financier will take security over shares in the company, enabling it to exert control in the event of mismanagement or default.” He concluded: “In one case, with which we are currently involved, a major multinational company, which was a customer of a Cayman entity, provided finance for expansion of the Cayman entity including new plants in several countries. This quasi-JV provided the company with access to finance that it, arguably, would have been otherwise unable to obtain. Later, concerns about the management of the company led to the multinational seeking the appointment of provisional liquidators to determine whether a restructure was possible. “Ultimately, the company was placed into liquidation and the multinational played a central role in the orderly realisation of assets by the liquidators as the major creditor and a member of the liquidation committee. The alternative in this case would have been for the multinational to gain control of the company by the shares pledged as security. In the circumstances, this option was not considered the most appropriate.”

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Offshore Joint Venture Companies

Hong Kong - Oldham, Li & Nie Gordon D. Oldham, Partner +852 2868 0696

Oldham, Li & Nie is a full service Hong Kong based law firm, established in 1987. In 2007, Oldham, Li & Nie opened its representative office in Shanghai. The partners of Oldham, Li & Nie have many years experience of serving local and international clients. Oldham, Li & Nie’s clients include publicly listed companies, developers and banks as well as private companies, individuals and various government bodies. The firm currently maintains 24 lawyers, each admitted to practise in one or more jurisdictions. In addition, the firm is home to lawyers admitted to practise in the People’s Republic of China, the UK, the US, Australia and Nepal. The Intellectual Property (IP) team of OLN’s PRC office also handles trademark filing and prosecutions with the PRC Trademark Office and the Trademark Review Adjudication Board directly. Oldham, Li & Nie understands from practical business experience that traditional legal specialisations are not always immediately compatible with commercial needs. The firm’s partners’ and associates’ strength lies in their hands-on business experience as well as their ability to offer practical advice in a cost-effective manner. Combining a western approach to individual client needs with knowledge of local Hong Kong and Chinese law and business practices, Oldham, Li & Nie is both insightful and international in its approach.

Oldham, Li & Nie is also an associate member of the Association of European Attorneys (AEA), helping the firm to provide more immediate worldwide solutions that better serve its clients’ cross-border challenges.

Oldham, Li & Nie is also an associate member of the Association of European Attorneys (AEA), helping the firm to provide more immediate worldwide solutions that better serve its clients’ cross-border challenges. Documentation based on client needs A common problem in any commercial transaction is the complexity and volume of documentation, and the danger is losing sight of the goals that a client wants to achieve.

Oldham, Li & Nie is especially skilled at dealing with the legal issues facing international companies seeking to have a presence in Hong Kong and mainland China. Oldham, Li & Nie tailors all documents to facilitate its clients’ needs on a particular transaction. The firm advises clients at every stage of a transaction and is available to assist from the development of strategies through to their implementation. Tax advice and strategies Oldham, Li & Nie also advises clients in respect of tax issues and the ever-changing laws and regulations affecting their businesses. Clients are consequently able to focus their resources on building and realising their business aspirations. The firm’s partners carefully consider every aspect of a transaction in the light of the specific needs of the client, to ensure that the client’s legal and economic concerns in a transaction are sufficiently and properly addressed and protected. Specific considerations include: the jurisdiction of a corporate vehicle, corporate structure, tax implications, operational issues and exit strategies. Oldham, Li & Nie is especially skilled at dealing with the legal issues facing international companies seeking to have a presence in Hong Kong and mainland China.

For more information please visit

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TAGLaw Robert Sattin President TAGLaw® +1 727 895 3720

TAGLaw® is a worldwide alliance of high-quality, independent law firms. It was founded in 1998 at the initiation of Peter Appleton Jones, who remains the chairman of the organisation. It has grown to over 150 firms in 85 countries, and the alliance ranks among the five largest legal alliances in the world. TAGLaw® members are highly-respected, value-driven law firms with local market knowledge and expertise. Members are carefully chosen based on their reputation and record, and on recommendations from existing members. Members undergo a rigorous screening process prior to invitation to the alliance, and are ultimately reviewed and approved by the TAGLaw Advisory Board. All TAGLaw firms agree to adhere to common objectives and standards, as documented in TAGLaw’s Standards and Charter. TAGLaw members commit to fulfilling to following objectives: • Provide excellent, timely and cost-effective legal services to clients of member firms; • Develop and maintain strong client relationships and personal service, enhanced by the international resources shared among alliance members; • Communicate clearly with clients on terms of professional engagement and progress of business; • Share international expertise and resources with member firms; • Provide referral opportunities to other members when appropriate. TAGLaw firms commit to the highest standards of client service with respect to: quality of work; service; responsiveness; communication; ethics; confidentiality; conflicts; and billing. Robert Sattin, president, believes that alliances are important for mid-sized firms in particular. They allow the firms to compete effectively internationally, service their clients, attract new clients, fill service gaps, market and brand themselves, and attract young talent. Commenting on the specific advantages of TAGLaw membership, he noted the relationship with its affiliated accounting alliance – The International Accounting Group (TIAG). “We hear repeatedly from outside speakers who speak at our and at various other alliance conferences that the relationships among our firms are uniquely strong and warm, both personally and professionally,” said Mr Sattin. “I think in large part this is because our firms are quite similar in personality, service offering and approach to practice. “Our member firms work on maintaining that and it’s noticeable to outsiders who attend our conferences for the first time just how engaged our members are in relationships with one another. This of course leads to a high level of trust and a high degree of smooth interaction for the benefit of the clients.” Mr Sattin noted that the alliance’s TAG Foundation allows members to contribute to charitable purposes around the world, which has enabled the alliance to respond to natural disasters such as those in Pakistan, Japan and New Zealand.

TAGLaw also has an educational offering through the TAG Academy. The academy’s courses are designed to address issues that relate directly to a firm’s bottom line. Curriculum is developed to provide the skills and knowledge necessary to: improve client relationships; obtain additional business from existing clients; attract new clients; strengthen professional expertise; and increase managerial competence. A recent success story for the alliance concerns a matter for one of member firm Harper Grey LLP’s (Vancouver, BC, Canada) top clients, handled by a fellow member - Munsch Hardt Kopf & Harr, P.C.(Dallas, Texas, USA). Harper Grey acts for a major Canadian bank which specialises in commercial financing and venture capital designed for entrepreneurs and small business owners. The client had lent money to a helicopter company and took security on three helicopters as well as other assets of the borrower. In February of 2011, Harper Grey was provided with official notice that one of the helicopters, a Bell 407, had been seized by US Homeland Security in Texas and was subject to a forfeiture order. It was alleged that the helicopter was owned by a Mexican drug lord who had been convicted and sentenced to 25 years in prison in the US. However, it was represented by the borrowers that they owned the helicopters and were unaware of its use for criminal activities. Harper Grey was advised that it would have 30 days in which to file a Petition in Texas to avoid losing the helicopter. The firm was able to quickly retain Munsch Hardt Kopf & Harr in Dallas, which set to work immediately to obtain an order for the release of the helicopter to the client. Despite the complex criminal issues and multiple creditor claims, the firm was able to expeditiously obtain an order for recovery of the helicopter, and it has now been returned to Canada and is now in the client’s possession. Commenting on recent legislation with significance for the alliance, Mr Sattin noted that the UK Legal Services Act is particularly important because of the increased possibility of public ownership of law firms. “That is creating threats to the multi-national firm in the US certainly, which are the firms that our alliance members generally compete with,” said Mr Sattin. “As those firms are potentially losing out to UK competitors there may be more mergers, which opens up a service gap in the market place. Firms may need to merge because of capital requirements at one level. There’s a vacuum that could be effectively filled by alliances such as ours.” Over the next 12 months the alliance aims to increase the visibility of its brand and its member firms. “We certainly want to continue to have our firms utilise all aspects of the alliance relationships, to boost their referrals, to boost education and sophistication of the younger lawyers and their managing partners and their marketing directors,” added Mr Sattin. Concluding with his predictions for the rest of the year and 2012, Mr Sattin stated his belief that the large international firm model is going to come under increased pressure, both through the economics of the practice of law and through the clients who are looking at mid-sized firms that have the sophistication to handle their needs at increased efficiency and lower cost. “I think the large firm model is going to see some stresses in the next year,” he said. “It’s hard time keeping lawyers who jump from firm to firm over economic issues, and the cost structure of those firms has, I think, put them at a bit of a disadvantage.”

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TABLE Dr. Gábor Germus Attorney-at-Law Germus and Partners Attorneys at Law Tel: +36 1 279 3330 Fax: +36 1 279 3349

Tim Meng Managing Partner GoldenGate Lawyers Tel: +8610 5870 2028 Fax: +8610 5870 2026

IMPORTANT NOTE: This memorandum is confidential and may be covered by legal professional privilege. It must not be used, read, disclosed or copied by any person, other than addressee. Unauthorized use is strictly prohibited and may be unlawful. If you have received this memo in error, please contact us immediately.

Frederick B. Martinez Partner +787 274-2964

Germus & Partners, together with its associated firm, provide full service to its clients. The firm’s teams are assisting the clients in project financing, M&A, litigation, employment and IP-IT matters as well as in general counsel activity. The firm is present in various industries such as finance, motor-vehicle, food and pharmaceutical industries, whereby it is at the clients’ disposal also in regulatory matters. The firm has a strong litigation, patent litigation practice. Its clients are mostly foreign (multinational) companies and Hungarian middle-big entrepreneurs.

GoldenGate Lawyers focuses its business on foreign direct investment, IP, and dispute resolution. Around 80% of its clients are foreign companies or foreign-invested enterprises such as Columbia Sportswear, Hofbrauhaus, Krones, Ogilvy & Mather, RitzCarlton, Ryder, SPA and World Bank. The firm’s IP and international arbitration abilities are highly recommended by its clients and by organisations such as Chambers & Partners, Legal 500, Managing IP, ALB, and Getting the Deal Through. In particular, Chambers & Partners recommended Tim Meng as one of the top 30 arbitration attorneys in China and as one of the top 30 IP attorneys in China in 2011. Martinez Odell & Calabria (MO&C) is a full service corporate law firm located in San Juan, Puerto Rico. The firm has been in existence since 1st August, 1979. MO&C offers comprehensive specialised services in the traditional areas of the law, as well as in emerging specialities. MO&C’s clients are provided with the highest level of concentrated expertise in all of the service areas covered by the firm. MO&C is structured in such a manner that virtually every single possible legal problem affecting a business, its owners and management can be attended by the firm with widely recognised expertise. MO&C’s operational departments are fully integrated and effectively interact with one another in order to provide its clients with thorough and effective counsel, addressing their legal needs and providing the most cost-effective solutions.

Rowedder Zimmermann Hass has been providing commercial legal advice since 1950. The firm’s clients range from publicly listed multinational and national companies, medium-sized and smaller businesses, management boards, managing directors and supervisory boards as well as private individuals, associations, federations and foundations in all areas of commercial law. Dr Andreas Pentz stated that the firm is privileged to work with some of the most renowned companies. Dr. Andreas Pentz (German) Attorney-at-Law, Partner Rowedder Zimmermann Hass Tel: +49 621 41938-0

Since the firm’s formation, it has a particular reputation for corporate law and intellectual property rights as well as inheritance law, including business succession planning. Additional specialisations of the firm are related to M&A, trading, tax and employment. “In this context, we always keep your commercial aims and the specific market environment in mind,” said Dr Pentz.

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ZAMBIA Robert Simeza Managing Partner Simeza, Sangwa & Associates Advocates Tel: +260 211 227574 + 260 211 227484 Fax: +260 211 220568

CAYMAN ISLANDS Paul Scrivener Partner Solomon Harris Tel: + 1 345 949 0488 Fax: + 1 345 949 0364

Robert Mbonani Simeza John Peter Sangwa

Kazimbe Chenda Jean Couvaras

Nsamba Kantumoya

The Colisieum, Block C Bwinjimfumu Road Rhodespark P.O. Box 36824 Lusaka, Zambia T +260 211 227484 F +260 211 220568 E

CYPRUS Marios Eliades Partner Tassos Papadopoulos & Associates LLC Tel: +357 22 88 99 99 Fax: +357 22 88 99 88

CHINA Mark Ho Partner Zhong Lun Law Firm | Shanghai Tel: +86 21 6061 3086 Fax: +86 21 6061 3555

Simeza, Sangwa & Associates Advocates is a full service law firm with a focus on both litigation and corporate services. As one of the largest and fastest growing firms in Zambia, the firm is dedicated to providing the highest levels of client service, skill and expertise to both corporate and individual clients. It services a mix of corporate and individual clients. The firm is committed to maintaining its market leadership in litigation and further developing its corporate and finance capablilities.

Solomon Harris is one of the leading independent law firms in the Cayman Islands and perceived as a very credible alternative to Cayman’s global law firms. Established in 1998, the firm is a full service corporate/commercial law firm with niche expertise in investment funds, captive insurance, mergers and acquisitions, capital markets, finance and restructuring/insolvency. The firm also has a thriving local law practice which includes real estate, local liscensing, employment and immigration. Solomon Harris practises Cayman Islands law from the firm’s offices in Grand Cayman and in Switzerland. The firm’s clients include major financial institutions, public and private companies, high net worth individuals and consulting firms.

The clientele of the firm comprises local and international banking institutions, semi-governmental organizations, municipalities and other local authorities, local and international building and engineering contractors, shipping enterprises, local and international information technology companies, publicly listed companies, investment firms, insurance companies, professional firms, large business concerns in commerce, tourism, hotels, general trade, oil and other fields and also includes the Cyprus Stock Exchange.

Zhong Lun Law Firm is a reputable Chinese firm with over 150 partners and 500 lawyers located in 8 offices in Shanghai, Beijing, Shenzhen, Guangzhou, Wuhan, Chengdu, Hong Kong and Tokyo. The firm provides services and support to foreign and Chinese clients in the areas of M&A, green field investment, PE/VC, environmental, employment, real estate, FCPA investigation, Chinese law compliance matters and many more. Its clients include many Fortune 500 companies and private entrepreneurs.

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TABLE Reasons for joining Germus & Partners joined TAGLaw in 2009; however the firm’s managing partner has been an active participant of the alliance since 1999. The firm joined as it believed TAGLaw offered a unique opportunity to serve its clients through the globe. The firm appreciates that fact that members are carefully selected in order to guarantee quality control. “Accordingly, we can be sure that our clients will receive a quality service in foreign jurisdictions,” said Dr Gabor Germus. “On the other hand, we can also help foreign partners and their clients in terms of their activity in Hungary. It has been evidenced over the past 2-12-years that the TAGLaw alliance is very helpful in international transactions, can compete with the service of the well-known franchise law (and accounting) firms with very competing rates. Taglaw has been helped us to assist our client in the US, HonKong, Germany, England and in Slovakia, Czech Republic or in Italy.” GoldenGate Lawyers became a member firm in 2008. Tim Meng noted that TAGLaw provides a good platform for building up connections with firms from other jurisdictions. “It also provides good opportunities to learn more about: firm management, promotion of business and branding, etc,” added Mr Meng. MO&C joined TAGLaw in 2002 because of the medium size and demographics of its members. Another important factor was the philosophical concept behind the organisation, as explained to the firm by the TAGLaw chairman, Peter Appleton Jones. Rowedder Zimmerman Hass joined the alliance as one of the first member firms in 1999 in order to be able to offer reliable legal advice to its clients in all the important jurisdictions. The Shanghai office of Zhong Lun became a member firm representing Shanghai in July 2011. Previously, another smaller Shanghai firm with Mark Ho and Blaine Turnacliff as partners was the Shangahi member firm. However, after Mr Ho and Mr Turnacliff joined Zhong Lun in 2011, Zhong Lun became the member firm in lieu of the previous firm. Simeza, Sangwa & Associates Advocates became members in September 2010 to benefit from the alliance’s worldwide connection. Solomon Harris joined TAGLaw in 2008 after being approached to become the Cayman Islands’

member firm. “Having looked carefully at the organisation, we felt it was beneficial to be able to cooperate and share business opportunities with like-minded, independent law firms across the globe,” said Paul Scrivener. “We also saw the advantage of further enhancing our own profile and being able to offer our clients ready access to well-respected firms in all the key jurisdictions.” Tassos Papadopoulos & Associates LLC joined the alliance soon after it was founded. Marios Eliades explained that Peter Appleton Jones was instrumental in the firm joining the alliance. “We realized that the truly global scope of the alliance and the quality of the participating firms would be a big advantage in the global legal environment that was being formed in the early 2000’s,” explained Mr Eliades. Value of membership Dr Germus stated that it is the firm’s privilege that it can represent TAGLaw in Hungary. For Germus & Partners, the main values of the alliance are that the firm has reliable partners all over the world enabling it to assist clients in their cross-border transactions and matters. “We feel very comfortable with our TagLaw membership,” said Fred H. Martínez at MO&C. “We value our relationship with TAGLaw management and with our fellow ‘TAGLaw colleagues.” Tim Meng noted that GoldenGate Lawyers “appreciate the opportunity to be a member firm and we hope to be a valuable addition to TAGLaw.” Being a member of TAGLaw helps Rowedder Zimmermann Hass helps the firm to reach its aim to provide reliable legal services to its clients in all the important jurisdictions. “On top of that we are able to discuss legal matters and questions concerning legal science with our international colleagues in order to broaden our own perspective,” commented Dr Pentz. Mr Scrivener describes Solomon Harris as the “new kid on the block”, stating that the firm is still finding its feet in the organisation. “Inevitably it takes time to work yourself into a new organisation, particularly where as an offshore law firm, our business model is somewhat different from the vast majority of the membership,” said Mr Scrivener. “However, we are already starting to see the benefits of our participation in TAGLaw not just for Solomon Harris

but also for our clients.” Both Simeza, Sangwa & Associates Advocates and Zhong Lun Law Firm are proud to be a member firm of the alliance. “TAGLaw is a significant alliance organisation with over 150 law firms representing 8000 legal professionals around the world,” commented Mr Ho. “We share experience and resources with numerous other member firms.” Alliance meetings Rowedder Zimmermann Hass attends nearly every event offered and organised by TAGLaw, especially the global and European conferences. “These events support the interaction with colleagues from all over the world and help us building up strong relationships to many colleagues and partner firms around the globe,” said Dr Pentz. MO&C regularly attends TAGLaw events and seminars. Mr Martínez commented: “On the professional side, there is always some information to be derived. On the business side, our relations with fellow TAGLaw member typically results in some flow of additional referrals.” Mr Ho has personally participated in TAGLaw for almost four-five years and enjoyed participating in many events organised by the alliance. These events have helped the firm get to know many other lawyers and professionals from other parts of the world and help build trust and working relationships between law firms and lawyers. “We’ve also learnt and gained information about state of art development and management of legal services and participated in training classes offered by TAG Academy,” added Mr Ho. Dr Germus explained that Germus & Partners attempt to participate in as many evens as possible, adding that TAGLaw has helped the firm to better understand its clients’ goals and follow and adapt international trends. GoldenGate lawyers usually participate in one global meeting and one regional meeting every year. “Face-to-face meetings with lawyers from other firms are very helpful in building up personal confidence,” noted Mr Meng. Tassos Papadopoulos & Associates LLC attends many TAGLaw events, particularly at the regional level. Mr Eliades described the events as a “great opportunity to meet face to face with

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the fellow members and also keep informed of recent legal developments internationally.” Simeza, Sangwa & Associates Advocates have attended TAGLaw conferences but not seminars. “Perhaps because we are new to the alliance, but the benefits are yet to be seen,” commented Robert Simeza. Solomon Harris is looking to become more involved with the organisation going forward and the firm’s managing partner, Sophia Harris, will be attending the Managing Partner Summit this year. “We are also currently engaging with one of the leading US member firms to discuss how we can work together more closely, in particular, in relation to investment funds,” added Mr Scrivener. Referrals Since joining TAGLaw, MO&C has received a more or less constant flow of referrals of varied concepts and magnitude. However, Mr Martínez noted that the recent years have been somewhat less productive, attributing this to “the very sick state of the world, national and local economy.” Rowedder Zimmermann Hass has always received referrals from TAGLaw partner firms as well as made such referrals to TAGLaw colleagues. The firm works closely together with a number of partner firms. Mr Ho has had chances of working with other member firms and received and provided referrals in the past. “However, referrals are based on trust and confidence you have in other lawyers and firms, not just based on the name of a firm,” he observed. “You don’t want to end up having your clients unhappy with the lawyer you refer them to work with.” Mr Scrivener stated that Solomon Harris is pleased to have received a number of business referrals from other members as they have become aware of the firm’s expertise. “We have also endeavoured to reciprocate, wherever possible, and continue to do so,” added Mr Scrivener. Germus & Partners, GoldenGate Lawyers, Simeza, Sangwa & Associates Advocates and Tassos Papadopoulos & Associates LLC have all also received referrals through TAGLaw. Cross border work According to Mr Scrivener, competition in the offshore legal market becomes more intense year by year. Medium sized law firms such as Solomon Harris have to be able to differentiate themselves. The firm has done so by focusing on niche financial services and by providing a highly responsive and personalised service that larger firms often find a challenge to deliver. “However, as a firm without own-office presence in multiple jurisdictions the firm could be overlooked by some multi-national corporations and global financial institutions,” said Mr Scrivener. “However, our membership of TAGLaw

enables us to demonstrate the global reach that our larger competitors pride themselves on without having to compromise on the genuine benefits that an independent law firm can offer its clients.” TAGLaw was very helpful for Germus & Partners in a technology transfer transaction in the US. The firm was able to help its clients setting up enterprises in Hong-Kong. The Indian TAGLaw member helped Germus & Partners in terms of a litigation matter. “We have regular employment matters in foreign countries,” said Mr Germus. “US counsel assisted a Hungarian Bank regarding an interbank settlement. Though there are several IP alliances (both in trademarks and patent field) the alliance was helpful in patent clearance matters in foreign jurisdictions.” Mr Meng noted that GoldenGate Lawyers have contacted a firm in New York and a firm in India for help on certain matters. He explained that, generally speaking, the firm has received much more help than it has offered. “Cross border work is greatly facilitated by the alliance,” stated Mr Eliades. “We have recently acted in advising in a multi-jurisdictional set-up of a fund and the immediate access to local expertise in other jurisdictions as well as the fact that we personally knew the other lawyers from the TAGLaw firm enabled us to perform the works from our end more efficiently.” Rowedder Zimmermann Hass works on many international cases, for example a current corporate matter concerning the US and Canada and on IP matters related to Asia. According to Dr Pentz it is extremely helpful to be able to count on renowned and experienced colleagues from the alliance in these situations. “We see more and more Chinese clients are going global and therefore our needs for crossborder support are increasing in the past years,” said Mr Ho. “TAGLaw provides a great alliance of quality law firms located in over 150 countries and offshore investment destinations.” Recent developments China continues to experience enormous change in many respects of the business and legislative development. For example, China has announced it is planning to open up an international listing board (International Board) for foreign companies to go public in China. “If this International Board is accomplished, we anticipate there would be an influx of Chinese IPO transactions to be entered into by overseas companies, initially by foreign companies with substantial Chinese business assets followed by many other companies if all goes well,” commented Mr Ho. There are also further modifications to the Civil Procedural Law in process in China. The Hungarian legislation is under significant change. Dr Germus explained that there is a new constitution, and the legislative norms adopted mainly in the 90’s undergo changes

whereby the State apparently is willing to increase its influence on the economy and markets by administrative measures. Dr Pentz explained that German corporate law is being influenced more and more by European regulations. “In this field it is helpful and now and then eye opening to discuss these developments and their transposal into national law with colleagues from other, mainly European, countries,” he added. Mr Eliades noted that in banking Cyprus, the regulatory environment is in the process of changing. “Having access to expertise from lawyers in bigger and more mature banking jurisdictions potentially offers significant benefits in assimilating these developments more quickly,” he observed. Expectations Dr Pentz explained that TAGLaw is a legal alliance building up on the quality of the services of its member firms – and still fast growing. He believes that the number of firms and attorneys connected through TAGLaw as well as their respective expertise allows the alliance to provide highly interesting events and seminars. “Recently the seminar activities have been organised in the TAG Academy,” said Dr Pentz. “The alliance also showed the social responsibility of its member firms by establishing the TAG Foundation. The alliance will work steadily on deepening the contacts between the member firms and by that on improving the rate of referrals between member firms further.” In the coming years, MO&C see TAGLaw transitioning to a newer generation in an effective and seamless manner. “We expect that the result will be for the organisation to continue to provide the support and service to which we, the members, have become used to,” said Mr Martínez. Dr Germus expects increasing activity in terms of speciality groups as well as in terms of the firm’s marketing policy as TAGLaw members. Mr Simeza predicts great success for the alliance – “if we improved our interaction among member firms.” Tassos Papadopoulos & Associates LLC see TAGLaw developing further both geographically by also in the expertise and training that it makes available to its member firms. Mr Meng is optimistic about the future of TAGLaw and is looking forward to joining the annual meeting held in Rio in October 2011. He believes that the alliance should promote itself more with INTA, IBA, Chambers & Partners, Legal 500 and Corporate INTL etc. “We are very pleased to be a member of TAGLaw and certainly remain positive about our continuing involvement with the organisation,” said Mr Scrivener. He concluded: “We believe that it can only assist in the ongoing development of our firm and hopefully we can play our part in helping TAGLaw to be the leading alliance of global law firms.”

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Investing in Russia

Elena P. Loss - Chairman of the Board RSM Top-Audit T: +7 495 363 28 48 |

Alexander Dolgov - Partner Gide Loyrette Nouel T: +7 495 258 31 62

Although there are some factors that limit the attractiveness of Russia to foreign investors, the overall business environment is positive. Currently, the government is working on improving the investment climate to make the country a more competitive market. LEGISLATIVE CHANGES Russia’s regulatory regime for foreign investments into strategic sectors is primarily regulated by the Federal Law “On the procedure of foreign investment in companies having strategic significance for the preservation of national defence and state security” (the “Strategic Investment Law”), signed by then President Vladimir Putin on May 5, 2008. The Law identifies 42 types of activity (or 15 broad sectors or industries) as strategic and thus subject to more stringent control by the federal government. Also added to the list are transactions involving Russian companies with rights to natural resource deposits having federal importance. The Strategic Investment Law was meant to consolidate the legal regime regarding foreign investments in various Russian strategic industries and also establish a transparent procedure for granting foreign investors access to such industries on a “one stop shop” basis. Since the implementation of the Strategic Investment Law, the regulatory thresholds for foreign investment into strategic entities were lowered whilst the list of strategic entities covered by the restrictions was significantly increased. Elena P. Loss, Chairman of the Board at RSM Top-Audit, pointed out that in addition to the existing special investment legislation, work is under way to develop legal regulations on the new forms of cooperation between the government and private business as part of public-private partnership. “Russia has an actively evolving legislation in this area making available a wider range of cooperation forms which take account of nuances of certain projects,” she said. Changes to the national tax legislation are also of huge significance. In June 2011 President Dmitry Medvedev signed a law amending


Art. 309 of Tax Code whereby equities listed on a stock exchange will no longer be subject to any capital gains tax. Ms Loss commented: “Although the adopted law by itself will not significantly increase the number of foreign investors on the Russian capital markets, these changes are an important step towards the creation of international financial center in Russia. This law is one of the actions in general government policy aimed at creating more favourable business climate.” PPP PROJECTS ON INCREASE According to Alexander Dolgov, Partner at Gide Loyrette Nouel, since the second half of 2010 business activity on the Russian market has been increasing, especially with regard to infrastructure and PPP projects. There is a large interest in these projects from Russian and foreign commercial banks and development institutions (e.g. EBRD, IFC, UNDP, World Bank, VEB). Consequently, the Russian State has realised the value of foreign investment in developing infrastructure and different industries, including those involving innovations. For the purposes of attracting foreign investment, legislation is constantly improved, PPP mechanisms are under development, and the State works on eliminating administrative barriers to investment activities. Since the beginning of 2011, a “commissioner for investors’ rights” has been based in each federal district of Russia. His duties consist of assisting foreign investors in their activities in Russia, including the provision of legal advice on exercising their rights. Nevertheless, as Mr Dolgov noted, despite that European infrastructure and construction companies, Western banks and international financing institutions have demonstrated an interest in Russian PPP projects, there are a limited number of well prepared and structured projects that have the potential to attract sponsors and financiers. Therefore, some potential investors come to regions and often offer their help at the pre-tender stage.

Notwithstanding the foregoing, many PPP projects are expected to be implemented soon. Mr Dolgov said: “I am in charge of Projects Group, which elaborated PPP Law of the Perm region, where it is planned that several PPP projects will launch in 2011 and 2012. “Our firm is the leading international law firm advising on PPPs in Russia. Our experience allows us to bring PPP projects from the bidding stage to financial closing. We are currently starting work on one of the major regional PPP projects – ‘Neva Water’ in SaintPetersburg representing the consortium of Gazprombank - Stroytransgaz - Veolia Water Solutions & Technologies.” ESTABLISHING A BUSINESS PRESENCE IN RUSSIA Foreign companies in Russia can carry out their activities through permanent establishment, i.e., representative office of foreign company, branch of foreign company, subsidiary or joint venture. As Ms Loss explained, if a foreign company carries out its activity through permanent establishment, the company obtains the status of the Russian resident and becomes subject to the national legal entity regime with all the rights and obligations envisaged by the Russian law. However, she also noted that when entering the Russian market an investor should know the peculiarities of the Russian law that regulates investment activity on the whole and governs the relations in the area selected for investments. The main challenges for investors include selection of business scheme, assessment and minimisation of existing risks, and building and implementation of business-processes including turnkey implementation. Commenting on the latter Ms Loss said: “Our firm specialises in providing a full range of services to the client in this area. Our priority is the implementation of turnkey projects which is why the firm has employed lawyers, financial analysts, auditors, valuers, management consultancy specialists who have repeatedly found successful solutions for the clients.”

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rbitration is now one of the standard dispute resolution mechanisms in use in international commerce. It is unlikely that the global economic downturn will push parties to cross-border transactions towards state courts for resolving their disputes. In fact economic difficulties may increase the number of contractual breaches such as payment defaults. The breach of certain obligations to perform due to lack of adequate financing may generate an increase in the number of arbitration cases.

That said some parties are more cost-conscious than a few years ago.

As a result, some parties may be more susceptible to serious amicable

discussions prior to the filing of a request for arbitration or to settlement

discussions after the start of the arbitration than they would have been a few years ago. Whether ADR mechanisms such as conciliation or media-

tion (which may or not lead to a settlement) can really gain more ground on arbitration will depend not only on the parties’ will to negotiate, but also on costs management. In continental Europe, and, in particular, in

France due in part to much less extensive discovery than in common law jurisdictions, the cost of litigating or arbitrating a dispute has not been such that ADRs have developed so much to the detriment of litigation

or arbitration. That being said ADRs are quite a viable option, especially in cases in which the parties wish to maintain their commercial relationship beyond a particular contractual dispute.


nternational cooperation When dealing with Arbitration at an international level, the two

main conventions that are extremely relevant are the Convention of the Recognition and Enforcement of Foreign Awards, also known as the

New York Convention and the European Convention on International Commercial Arbitration. Although knowledge of multi jurisdictional

law and cross-border negotiations is not essential for firms representing clients in arbitration proceedings, it is certainly a helpful tool that helps distinguish firms based on their high calibre of service.

“Arbitration at Bredin Prat is practised by a group of lawyers at a

very high level, who have knowledge of both common-law from the

United States and England, and civil law. The lawyer’s backgrounds and diverse experiences help them to form dedicated teams, with the skills

suited to the needs of the customer depending on the seat of arbitration. The firm operates with strong involvement from the partners throughout each case,” said Didier Martin partner of Bredin Prat.

Litigation, arbitration and criminal law cases have been at the heart of

the activities of Bredin Prat since its inception more than forty years ago. Today, Bredin Prat is considered one of the best French firms in the areas of civil litigation, commercial law and criminal business including both domestic and international arbitration.

The firm’s legal team practises domestic arbitration and international

law, French or foreign, through institutional procedures subject to the regulations of the ICC, the LCIA, ICSID and the AAA, or ad

hoc procedures. For disputes subject to foreign laws, Bredin Prat

works closely with the best independent local firms, including ‘Best Friends’ the firm’s network partnership with like minded practices, to ensure its clients get the best advice and assistance possible.


upport from the French courts In France, the 1981 Decree on arbitration was one of the first

modern arbitration laws, and even today remains more progressive than subsequent arbitration legislation in other countries. In May 2011, the new French arbitration law came into effect

(Decree n° 2011-48 of 13 January 2011). This represents the first major reform of French arbitration law. The reform is limited

to arbitral procedure. The new law aims to enhance efficiency in the arbitral process and enforcement of arbitral awards, to clarify the law and to make it more flexible and accessible to foreign practitioners.

“The use of alternative dispute resolutions techniques such

as arbitration is broadly encouraged for commercial disputes.

The French courts do not interfere in the arbitration procedure.

French law is supportive of arbitration and France (home of the ICC and one of the most popular seats of international arbitra-

tion) has developed an arbitration culture. Various conferences, publications, and professional organisations advocate for ADR such as arbitration or mediation,” explained Thierry Bernard, partner of the firm Cabinet Bernards.

Bernards is an independent French business law firm which

offers a full range of legal advisory and litigation services dedi-

cated to corporations. Bernards’ aim is to provide pragmatic and high quality services to clients in each market where Bernards practises. Bernards has offices in Paris and is a member of

Cicero, an international league of lawyers, allowing close professional relationships for the benefit of clients.

“In today’s global marketplace, disputes are growing in number

and complexity. Corporations are facing competition and must

manage the risks in doing business. Arbitration and other ADR

techniques will be developed and used more and more. But this development can not be performed without guidelines. Recently, the use of the arbitration procedure in a dispute involving the French

authorities has been criticised as being a “too confidential” process and a biased dispute resolution,” added Mr Bernard.

For international contracts, the French legislator has encouraged

arbitration for decades and French state courts have routinely acted in support of the arbitral process by helping parties to constitute

arbitral tribunals when a party did not participate in the proceed-

ings in ad hoc arbitration cases, i.e., cases in which the parties had

not designated an arbitral institution to administer the proceedings. The policy to encourage arbitration of disputes relating to inter-

52 Corporate INTL September 2011

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French arbitration

“In today’s global marketplace, disputes are growing in number and complexity”

national contracts is indeed in line with the fact that France has

French Arbitration association

always been a magnet for foreign direct investment. The more a

country opens itself to foreign investment, the more its authorities

and judges must be receptive to the possibility that disputes be

resolved through arbitration (rather than its own state courts) or ADR techniques such as mediation.


Didier Martin - Partner

trong French tradition

Bredin Prat

France has been at the forefront of arbitration for decades for

+33 1 44 35 35 35

various reasons. Also France has been among the world’s most

pro-arbitration jurisdictions. In addition, the judges who deal

with actions to enforce or to set aside awards in France all have specialised knowledge in arbitration.

Thierry Bernard - Partner

The only difficulty that clients may face is when trying to

Bernards Firm

solve a commercial dispute using arbitration in France, one

+33 (0)1 53 53 82 82

party does not want to comply with the ruling, or the arbitration

award. This difficulty is not specific to France. In case of lack of

voluntary compliance with an award, the competent state court of the place of arbitration may have to intervene if the recalci-

trant party challenges the award in the country in which it was

Eliseo Castineira - Avocat à la Cour

rendered. A party may also try to enforce the award, or resist


its enforcement, in a country other than the place of arbitration,

+ 33 (0)1 53 45 97 62

award is sought would have to intervene.

there again a state court of the country where enforcement of the

Eliseo Castineira, Avocat à la Cour and founder of the epony-

mous firm, clarified the fundamental knowledge required before

Xavier Nyssen - Partner

parties undergo arbitration in France.

Dechert (Paris) LLP

“Particular attention should be paid to the need for French

+33 1 57 57 80 01

language capability in case the winning party applies to French

state courts to enforce an arbitral award against a recalcitrant

party or in case the losing party tries to set aside the award if the place of arbitration is in France.”

Mr Castineira, who has been involved in major mergers and

Michel Leger - Managing Partner

acquisitions prior to specialising in international arbitration, acts

BDO France

both as counsel and arbitrator and his arbitration experience

+33 (0)1 58 36 04 30

involves states and state entities as well as businesses. Castineira

is a boutique firm based in Paris. The firm is mostly focused on arbitration, both domestic and international. It is also involved

in transactional work and providing corporate and commercial

Laurent Cohen-Tanugi - Founding Partner

law advice. Castineira was born out of a desire to meet market

Cabinet de Laurent Cohen-Tanugi

demand for high-quality advice in small and medium-sized ar-

+33 (0)1 47 05 38 00

bitration disputes. The majority of arbitration cases involve less

than US$ 10 million in dispute.

Mr Castineira also stressed: “The need to know the applicable

rules contained in the French Code of civil procedure to enforce the award in France or, if the place of arbitration is in France, to try to set it aside. In proceedings to enforce a foreign award in

France, the parties need to be well-advised on the formalities and time limits applicable to the exequatur and any appeal which

AGaramond + Stone Sans ITC



Pascal WILHELM - Avocat au Barreau de Parisv +33 (0)1 53 93 9230

September 2011 Corporate INTL 53

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French arbitration

“The main advantages of arbitration over litigation are not cost or speed, but the confidentiality of proceedings and the benefit of selecting arbitrators that are often more experienced in international business than state judges” may be made against a decision refusing the

give their preference to international arbitration.

ings, the possibility of cost cutting in contrast

In the context of actions to enforce foreign

barriers, a lack of familiarity with the French ju-

appropriate when the amounts or interests at


awards in France or to set aside awards

rendered in France, it is not only required to

know the procedural content of the rules of the French Code of civil procedure applicable to

This preference can be explained by language

dicial process, the search for confidentiality and

quality, and the possibility to choose tailor-made procedural rules and arbitrators.”

Dechert’s multilingual international arbitra-

to state court proceedings. It is not always

stake are limited. That being said it is often

the favoured choice of dispute resolution for a multitude of financial sectors across France.

“Given the current difficult business environ-

arbitration, but substantive knowledge is also

tion team has distinguished itself as a global

ment, we think that the arbitration, or other dis-

set aside an award or resist its enforcement on

practice and extensive experience helping

part in the field of conflict resolution from now

fundamental in the case where a party tries to the ground that it is contrary to French international public policy. The concept of French international public policy only partially

overlaps with the concept of French domestic

public policy therefore in-depth knowledge of how French state courts apply international public policy is indispensible.


ommercial disputes During a global recession it is important

for a country’s legal services to be appealing

and accessible to foreign investors. When asked to what extent is arbitration used to solve commercial disputes involving foreign investors in

France, Xavier Nyssen Partner of Dechert Paris

LLP explained to Corporate International how a clear distinction needs to be made first.

“A difference should be drawn between

investment disputes involving foreign investors which are commonly litigated before

investment arbitral tribunals such as the ones convened under the ICSID arbitration rules and commercial disputes involving foreign

investors which are commonly litigated before commercial arbitral tribunals. Until now, there

leader in International Arbitration for its

clients engaged in cross-border matters. With arbitration experts in London, New York,

Paris, Moscow and Washington D.C., Dechert lawyers have served clients on all sides of

judiciary offers a neutral forum to adjudicate

these types of claims, foreign investors usually

Michel Léger chairman of BDO France is

and law firms in valuations damages and

medium-sized companies, and individuals.

This has provided the firm’s lawyers with a

deep understanding of disputes arising from a wide range of industries, from oil & gas to

construction, defence, telecommunications and pharmaceutical companies.


road scope France is considered one of the most

arbitration-friendly countries in the world.

France can provide litigation support to clients deliver comprehensive structured and detailed computation and files. BDO France can act as

expert in the areas of finance, accounting standards but also information system in an arbi-

tration process. Mr Léger also acts as arbitrator himself or as a member of an arbitration panel where he brings his accountant experience.


onfidentiality of proceedings “The main advantages of arbitration

It has an extremely liberal body of case law

over litigation are not cost or speed, but the

legislation with the enactment of Decree No.

of selecting arbitrators that are often more

in the field, and has recently modernized its

2011-48 of 13 January 2011. French courts have also been extremely arbitration-friendly at

the enforcement stage and have shown their independence in high stake disputes.

There are several main advantages to resolv-

choose the right venue and rules of procedure

mercial claims in France. Although the French

quently their lower cost,” said Michel Léger.

joint ventures, multinational corporations,

ties, majority and minority shareholders in

against France.” said Mr Nyssen.

forum for foreign investors to bring their com-

the procedures and their duration and conse-

active in different areas of arbitration. BDO

ing disputes through arbitration as opposed

Mr Nyssen added “Arbitration is a common

on. The main reasons are the confidentiality of

the table, representing states and state enti-

is not a single instance in which a foreign

investor has brought an investment claim

pute resolution alternatives, will take a larger

to litigation are. Firstly the ability of parties to

confidentiality of proceedings and the benefit experienced in international business than

state judges,” says Laurent Cohen-Tanugi a

Paris-based international lawyer specialising

in cross-border mergers and acquisitions and

international arbitration.“On the negative side of things, the arbitration world tends to be a bit academic and confined”, he observed.

A member of the Paris and New York bars, Mr

for their dispute, followed by the ability of the

Cohen-Tanugi concurs with his fellow practitio-

their case. There is also the overall speed and

arbitration centre, thanks to the longstanding

parties to choose the arbitrators that will decide efficiency of the arbitration proceedings and

finally depending on the length of the proceed-

ners in viewing Paris as a premier international presence of the ICC Court of Arbitration, a

liberal governmental attitude towards arbitra-

54 Corporate INTL September 2011

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French arbitration

tion, and the attractiveness of France for international

business. “French arbitration law has just been further


codified and modernised and really is ‘state of the art’”, commented Mr Cohen-Tanugi.

Laurent Cohen-Tanugi’s distinctive mark in the

French arbitration world is his standing as a trans-

actional lawyer as well. As a former partner of two

top-tiered US law firms, he has been involved in some of the largest cross-border M&A transactions of the past 20 years while acting as counsel in numerous

ICC arbitrations. A highlight of Mr Cohen-Tanugi’s

arbitration career was his representation of the Bank

for International Settlements in ad hoc public international law proceedings in The Hague, in connection

with the Bank’s repurchase of its own shares held in private hands.

In 2008 Cohen-Tanugi set up his own boutique

firm where he acts as arbitrator as well as counsel in

disputes involving complex legal or business matters, among other personal engagements such as serving as a government-mandated independent corporate monitor. “We offer a special mix of international

experience, independence, strategic advice and costeffectiveness,” added Mr Cohen-Tanugi.


edicated lawyers and arbitrators Although there is an efficient arbitration sys-

tem in place in France it is important to recognise the integral part that the lawyers and arbitrators play in the grand scheme of alternative dispute

resolution cases. Firms which offer high quality

services and comprise of top class professional are the cogs that keep the legal machine running.

“Arbitration has proved to be more efficient in

terms of efficiency, quickness and confidentiality, all values that are developed by our firm,” commented Pascal Wilhelm of French Firm Wilhelm & Associés. Wilhelm & Associés is an established practice that

is constantly growing. The firm’s founding partner Pascal Wilhelm played a forefront role in the high-

profile Bettencourt case. The legal team also includes key partner Arnaud Péricard, who is well known to

the Legal 500 to be a ‘calm, organised and fine’ litigator who acts in corporate, shareholder and liability disputes. Wilhelm & Associés raised its profile in

2010 through its involvement in a high profile case involving Jean-Marie Messier in a major dispute

initiated by the shareholders of Vivendi Universal.

The Litigation and Arbitration Department of the firm

Wilhelm & Associés is comprised of lawyers dedicated to resolving disputes during judicial litigation, com-

mercial matters, criminal matters before the courts and judicial arbitration. The firm has significant experience in corporate law litigation liability of directors and

associated pre and post acquisition disputes as well as

shareholder disputes and liability of auditor’s cases. The firm’s business and litigation team has particular exper-

tise in crisis situations in which an arbitration procedure can be used to resolve a deadlock situation.

Louise Barrington Director +852 6409 0356 +336 2573 3932

International arbitration and mediation boutique Aculex works with ‘smaller’ cases (under $10 million) for corporations and individuals, bringing in trusted partners for larger or more complex cases. Former ICC Asia director and law professor Louise Barrington has over 25 years of dispute resolution experience, and the Aculex team’s low overhead ensures quality advice and reasonable fees. Aculex serves clients in Europe, Asia and North America, and assists firms which do not have a dedicated international arbitration team. France has traditionally been the home of international arbitration, for parties from all over Europe and North America. Paris courts designate a specialised judge to deal with cases involving arbitration. The ICC is headquartered in Paris and its new state-of-the art hearing centre, near Trocadero, boasts tailor-made facilities and services for arbitrators and counsel. French investors and commercial people recognise international arbitration as the preferred method for resolving international disputes. France’s recently revamped arbitration law reforms what was already one of the most liberal in the world. Decree 2011-48 came into force on 1 May 2011, and governs arbitrations agreed to after that date. The law is contained in Articles 1442 to 1527 of the French Code of Civil Procedure (CCP). The reforms incorporate principles established by the French courts and make the law more accessible to foreign parties and practitioners. “The new law allows parties to seek assistance from the Tribunal de Grande Instance (‘le juge d’appui’) for assistance, if their arbitration agreement has not adequately provided for the constitution of the tribunal. It also provides that its (new) writing requirement is satisfied by an exchange of writings or a document to which the main agreement refers. It also recognizes that parties may need to obtain from state courts ‘investigative, provisional or protective measures’ before the arbitral tribunal is in place, but also provides the tribunal, once constituted, with authority to exercise these powers,” said Louise Barrington director of Aculex Transnational. The reform brings specific provision for majority awards, or absent majority, a decision by the chair. The death, removal or resignation of one arbitrator no longer ends the procedure, which is now suspended until a replacement is put into place. Parties objecting to any procedural regularity must now do so early, or be deemed to have waived their objection. The new law also allows flexibility for communications, including electronic methods, confirms that an award is generally not subject to appeal, and shortens the time for a party to request rectifications. Ex parte enforcement of awards is the norm. These provisions, and others too numerous to mention here, should streamline the arbitral process available in France. However, even with efficient legislation, it is up to the parties and counsel to use it appropriately. Arbitration procedures frequently become bogged down by procedures which although appropriate for a state court hearing, are inappropriately complex and expensive. Arbitrators and counsel alike must resist the temptation to ‘leave no stone unturned’, and assess the cost efficiency of the procedures they choose. Aculex works with parties and counsel to design efficient proceedings and to keep delays to a minimum. This can result in substantial cost savings for the parties.

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ASIAN IT FOCUS On April 11 2011, India’s Ministry of Communications and Information Technology notified the Information Technology (Reasonable security practices and procedures and sensitive personal data or information) Rules, 2011 under the Information Technology Act, 2000. As a result of this India now has a privacy law, brought into force with immediate effect with wide ramifications on the way companies will do business in India. This client advisory provides a description and review of the new law.

INFORMATION TECHNOLOGY ACT Until a couple of years ago, Indian law had no provisions dealing with privacy protection. The enactment of the Right to Information Act, 2005 gave a fillip to transparency in government dealings and concurrently provided some protection against the unwarranted disclosure of confidential information under that law. In 2008, the IT Act was amended to introduce a new civil provision prescribing damages for an entity that is negligent in using ‘reasonable security practices and procedures’ while handling ‘sensitive personal data or information’ resulting in wrongful loss or wrongful gain to any person. The act further provided for criminal punishment for a person if (a) he discloses sensitive personal information; (b) does so without the consent of the person or in breach of the relevant contract; and (c) with an intention of, or knowing that the disclosure would cause wrongful loss or gain. In effect, the civil provision merely provided for damages for negligent conduct which is already available under common law. The criminal provision is fairly narrow and includes an element of ‘mens rea’, i.e., actual intention to do wrong is required. The two provisions were clearly not comprehensive in terms of privacy protection in India. According to Pravin Anand managing partner of the Indian firm Anand and Anand improvements to the current IT legislation can encourage new investors to come and set up shop in India. “We believe that the strengthening of legislation of this nature greatly encourages new investors to invest in India and set up their businesses in India. The primary objective of Information Technology (IT) Act, 2008 is to create an enabling environment for commercial use of I.T. It also aims to provide the legal infrastructure for e-commerce in India by providing for the legal framework so that legal sanctity is accorded to all electronic records and other activities carried out by electronic means. The cyber laws have a major impact for e-businesses and the new economy in India,” commented Pravin Anand. Anand and Anand is a full service Intellectual property law firm which thrives on challenges, creative thinking and constant improvement of its legal knowledge and skills. The firm is constantly innovating systems to strengthen its infrastructure to support diverse client needs along with identifying ways of adding value in its services to clients. Additionally, Anand and Anand specialises in various diverse fields of intellectual property aspects.

Pravin Anand Managing Partner Anand and Anand +91 120 4059300

IMPACT ON OUTSOURCING Many global organisations are choosing Indian outsourcing companies for a number of reasons, such as cost-effective services, increased efficiency, increased productivity, shared risks, reduced operating costs, increased quality, better services and more time to focus on core competencies. In order for India to keep its reputation as an ideal location for work relocation and outsourcing, the country must maintain efficiencey across the board including the regulation of data protection and information technology. “The introduction of the Rules along with other amendments to the Information Technology Act, has strengthened the laws in relation to data protection and privacy in India. Additionally, Data Security Council of India (“DSCI”), which was set up by the National Association of Software and Services Companies (“NASSCOM”) has been promoting standard practices including as to data protection, developing security and privacy codes and standards and encouraging the Information Technology Enabled Services companies to implement the same,” explained H. Jayesh founding partner of Juris Corp. Mr Jayesh added: “The endeavor is to keep them in line with global standards. All in all, we believe that this will strengthen India as an attractive jurisdiction not only to the outsourcing business, but also for offshoring business.” Juris Corp is not just a plain vanilla law firm but plays a pivotal role in changing mindsets and value addition. The firm believes in being innovative rather than just following archiacal modes of working and set patterns in India. The firm believes in multi-disciplinary approach and has in its midst Chartered Financial Analysts, Charter Accountants and Company Secretaries in addition to each of them being Attorneys. The quality that sets the Firm apart from the other law firms is its ability to think beyond its clients and bringing down unnecessary or avoidable legal costs through innovation and forward thinking. Ms Sivaramakrishnan partner of Juris Corp concluded: “India has been at the forefront of enacting laws furthering the use of information technology. Whenever it has been realised that there are gaps to be filled or course corrections to be made, the government has moved swiftly and ensured that the needful is done.”

H. Jayesh Founder Partner Juris Corp +91 11 4175 1889

Ms. Veena Sivaramakrishnan, Partner Juris Corp +91 11 4175 1889

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TIAG Alliance

TIAG Alliance Robert Sattin President TIAG® +1 727 895 3720

TIAG® (The International Accounting Group) is a global alliance of high-quality, independent accounting firms with more than 100 member firms based in over 60 countries. Member firms serve clients around the world in a range of business transactions. According to Robert Sattin, president, TIAG’s primary distinguishing factor is its alliance with its affiliated law alliance, TAGLaw. Together, the two organisations have 260+ offices in over 90 countries around the world. To highlight the successful interaction between the two organisations, member firm Mercer & Hole produced a 2011 calendar featuring a different TAGLaw or TIAG firm each month, including a success story. One such example, featured on the September page, explains that HSOC Financial & Business advisers in Ireland have helped Mercer & Hole with several clients, ranging from advising on setting up in business in Ireland, to succession planning and completing Irish tax returns. Dealing with Irish VAT for Mercer & Hole’s clients increasingly sees the firm involving Kerri O’Connell at HSOC. Similarly, Mercer & Hole has helped Ms O’Connell’s clients with their UK tax position, both personal and business. Another example, featured on the October page, notes that Mercer & Hole has one particular client who has begun a number of projects to build and supply biomass power stations to deliver renewable energy to the Philippines. Romy Sison of Banaria, Banaria & Co., TIAG member in the Philippines, now supplies accounting help and carries out audits locally, allowing Mercer & Hole to audit the consolidated accounts in the UK. “A second distinguishing fact is that we treat the world as a flat business market place for our firms,” said Mr Sattin. “We are not regionalised in our governance, our conferences or our approach. We are international in that sense and I

think that as a result the relationships around the world that have been formed are very strong, without putting significance on what part of the world the firms come from.” 2011 has been an interesting year for TIAG in several respects. The alliance has added many new members, but has also lost some members to mergers around the world. However, in almost every case where TIAG has lost a member to a merger, that member has helped the alliance to find a larger firm to replace them. Mr Sattin described the most recent conference as successful, noting that they are measured as much by the levels of energy and interaction among the members as by the headcount. “The headcount was about at our usual, but the energy level was very high, as was the interaction,” said Mr Sattin. “The connection between the lawyers and accountants grows, as do the connections within the groups themselves.” The next conference is to be held in Rio in October. The conference is notable as it is the first time the alliance has held a conference in South America, in recognition of the large number of Latin American firms that are active in TIAG. It is also significant as it is only the second time that both law firms and accounting firms will meet for the entire conference – usually they have separate meetings for a day and then together for a day. The focus for the conference is on making members experts in their home jurisdiction on doing business in Brazil. Commenting on his expectations for the next 12 months, Mr Sattin anticipates a change in the difficulty some accounting firms have had in attracting young talent. “I think the best and the brightest around the world may gravitate towards the accounting industry more, which has had several years of struggling to attract high quality graduates out of universities and training programs,” observed Mr Sattin. “I think there’s going to be more talent available to our firms around the world and, sensed just from the number of firms that seek us out now, a growing sophistication in the mid-sized accounting firms as their clients expand around the world. “We remain quite satisfied that the multi-disciplinary approach we’ve taken and the benefit our firms have had – both lawyers and accountants now comfortable with one another and available to one another’s clients – is an advantage, and something that is likely to continue to be of significant benefit to businesses around the world,” concluded Mr Sattin.

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TIAG Alliance

multinational and private companies in Senegal and West Africa. Its main strength is the diversity of services it offers and its ability to work in the three languages of West Africa (English, French and Portuguese).

Ed Martin CPA Adams, Martin & Associates +1 919-239-8522

Babacar Ndiaye Managing Partner BND Consulting Tel: +221 33 889 51 89 Fax: +221 33 821 60 20

António Nunes Administrador NUCASE +351214585700

TIAG Alliance Focus Corporate INTL spoke to three TIAG member firms to get their take on the alliance and the benefits of membership. The firms • Nucase NUCASE was established in 1978. It sets itself apart from other accounting firms through a strong focus on finding the best fiscal solutions for clients and on constant improvement of internal processes, staff training and use of the latest technology. NUCASE’s culture is one of creating a partnership with each of their clients. In order to provide the best service, each client is serviced through a client team, and has a chartered accountant assigned to head the team and manage the relationship. NUCASE is dedicated to meeting the needs of its sole proprietorship and corporate customers, continuously seeking to: • Increase the value add of the relationship with its customers, suppliers, tax authorities, partners and other entities, ensuring compliance with their specific requirements; • Provide innovative services to support the management of the businesses of its customers; • Improve work processes and internal organisational methods, as well as working conditions and the satisfaction of the expectations of their collaborators. In the pursuit of these objectives, NUCASE defines the following standards in its Policy on Quality:

• Involvement and accountability of all collaborators in the provision of services and search for new organisational solutions; • Attitude of innovation in the services provided, through the continuous assessment of the implicit and explicit expectations of current and future customers; • Continuous technical updating, enabling the evolution of all of its collaborators; • Technological evolution, through active research of the most appropriate and effective solutions for their organisation, and consequently more competitive services, better adjusted to the needs of customers; • Encouragement of a management culture, offering external and internal customers an additional platform of complementary services to support management; • Transparency and rigor, providing collaborators and customers with relevant information for the development of their activities. The firm has been ISO 9001 certified since 2003. NUCASE founded an additional company in 1987, Pronucase, in order to provide management consulting services to their clients, designed to support their clients in an integrated fashion (IT consulting, business intelligence, software, QMS, ISO certification). • BND Consulting BND Consulting is an accounting and advisory firm set up in 2005 and operating from Senegal in the 15 member states of the Economic Community of West African States (ECOWAS). The firm has worked extensively for international and regional organisations as well as

• Adams, Martin & Associates Adams, Martin & Associates was established in 1985 and is based in Raleigh, North Carolina. The firm has a team of highly dedicated, experienced and qualified individuals whose mission is to provide its clients with superior service and expertise that result in their improved financial well-being and unsurpassed client satisfaction. The firm employs a client service team approach to offer its business and individual clients a broad range of personalized accounting, tax and advisory services. In addition to providing traditional accounting and tax compliance and advisory services, Adams, Martin & Associates also has specialities in litigation support, forensic accounting, bankruptcy, and state and local taxation. Adams, Martin & Associates has also implemented a team approach in appointing internal quality control committees that continuously review all aspects of its client service, the goal being to provide their clients with the highest quality accounting and tax services possible. The firm has corporate clients representing most industries, including: construction; real estate; professional services; manufacturing; retail; and technology. It has successfully advised companies and their shareholders in mergers and acquisitions. Reasons for joining NUCASE joined TIAG in late May 2011, after some contacts with representatives from TAGLaw and TIAG in Portugal. NUCASE has had contacts with other alliances in the past, but the firm felt that TIAG could help promote its knowledge and expertise, both in Portuguese and Angolan tax systems. “We expect to share experiences with other partners, to create opportunities for them through Portuguese investors and to give all the support needed for foreign investment in Portugal,” commented António Nunes. BND Consulting joined the alliance in July 2011, after the merger of IGAF Polaris and Fidunion International. “The choice of TIAG is justified by the will to belong to a strong alliance that can add value to our competitive position in West Africa,” said Babacar Ndiaye. Adams, Martin & Associates also joined TIAG in May 2011. “Many of our clients are doing business internationally, and we joined TIAG in order to have access to an international alliance of quality CPA firms to whom we can go to as a resource if we have a client that needs assistance or guidance in a particular foreign jurisdiction,” explained Ed Martin. “Additionally, we view TIAG as a venue

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to which we can market our own unique expertise and client service.”

“FOR FIRMS THAT HAVE CLIENTS WITH INTERNATIONAL ISSUES, WE DEFINITELY WOULD ENCOURAGE THEM TO INVESTIGATE HOW TIAG MEMBERSHIP COULD BENEFIT THEIR CLIENTS.” Benefits of membership Mr. Martin noted that Adams, Martin & Associates is very new to TIAG, but the firm is very pleased with what they have seen so far. The firm values having access to an international association of tax and accounting professionals, so that it can provide its clients with the best information and service possible should an international tax or accounting issue arise. “When we meet with a prospective client, we want to be able to tout our own international tax experience, and the international resources we have access to via TIAG.” Mr. Martin added that the firm recently had a client who provides theatre design services that had performed contract services in Puerto Rico and Canada in 2010, and the firm wanted to know their filing requirements. “We were able to reach out to CPAs in those areas and gather the information needed to properly advise our client,” said Mr. Martin. Mr. Nunes stated that NUCASE is very excited about its recent membership with TIAG, and that the firm expects that it will be of great value regarding good practices and experiences exchange. He also expects new opportunities with international firms that want to develop their business in Portugal. Mr. Ndiaye noted that BND Consulting has a lot of expectations for more opportunities to collaborate with stronger firms through joint ventures, knowledge sharing and training. “We value the autonomy left to member firms while sharing strong ethical values,” added Mr. Ndiaye. Recommendations Mr. Nunes stated that NUCASE has already recommended membership of TIAG to Arrabe Assessores, from Madrid. “We have had a partnership for a long time and the opportunity of being available in an international alliance is very interesting,” said Mr. Nunes. BND Consulting would also recommend membership to the alliance, and has started with its partners in West Africa. Mr. Ndiaye believes that this will strengthen the firm’s competitive position in West Africa. Mr. Martin concluded: “For firms that have clients with international issues, we definitely would encourage them to investigate how TIAG membership could benefit their clients.”

Lowe Lippmann Joseph Franck Senior Partner Lowe Lippmann +61 3 9525 3777

Lowe Lippmann is a premier chartered accounting, financial services and consulting firm in Melbourne, Australia, with over 60 years of experience. “The success of Lowe Lippmann can be gauged by our total commitment to pursuing our clients’ interests in a positive, professional and energetic manner,” said Joseph Franck, senior partner. “Ultimately our success is measured by our clients’ success.” The firm’s clients represent a broad range of industries and vary in size from individual employees and investors to companies with annual turnovers in excess of $100 million. “Clients have for many years relied on Lowe Lippmann’s technical and business skills. The close working relationship our partners, consultants and senior personnel have with clients ensures a thorough understanding of each client’s financial circumstances, enabling us to tailor appropriate strategies to achieve their objectives.” Lowe Lippmann has a long-standing involvement with family businesses which receive the direct attention of the firm’s partners, ensuring they achieve the maximum rewards from their business and, where appropriate, the firm assists them in formulating their succession plans and exit strategies. Lowe Lippmann acts for many clients who are the second and third generations of its original client families. The firm continually implements improvements in technology and procedures and offers a comprehensive range of traditional and specialised services in keeping with its clients’ varied requirements. Lowe Lippmann joined TIAG in January 2003 as a result of the dissolution of the firm’s previous affiliation. This membership has provided the firm with direct access to quality accounting firms all over the world. “We value the exchange of ideas gained through our membership and the lessons acquired from other’s experiences,” said Mr Franck. “This aids us in refining our own practice to ensure we deliver world class accounting and business services to our clients.” As members of TIAG, Lowe Lippmann looks forward to the alliance expanding and focusing on regional firms working together more than in the past. “Joining the TIAG alliance is a great opportunity to be part of a global accounting community and provides a platform for us to engage with like-minded accountants across international waters and leverage off their local market knowledge expertise when necessary,” concluded Mr Franck.

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Arbitration in Switzerland

Switzerland is one of the preferred countries for international arbitrations. The country has a modern international Arbitration Law in Chapter 12 of the Swiss Federal Private International Law Statute, which has been in force since January 1, 1989. On a liberal and flexible basis, essential provisions assure a proper constitution and functioning of the arbitral tribunal and give the parties (and the arbitrators) all the necessary flexibility to conduct the arbitral proceedings in accordance with their own fair and reasonable expectations. According to the Swiss Arbitration Association, any dispute involving a business interest is per se arbitrable in Switzerland, no matter what other laws dictate. Michael Schneider is the president of the ASA, a non-profit association with more than 1,000 individual members. Membership within the association is open to all interested individuals. Many law firms support ASA’s various endeavours via the sponsorship of events or participation of their members in ASA’s conferences, workshops and publications. Mr. Schneider, who is also a partner in the largest Swiss arbitration practice, namely LALIVE, commented: “The ASA contributes to the development of arbitration law and practice in the region through the exchange of views and opinions in its regular conferences as well as its quarterly bulletin. ASA is currently supporting the ongoing effort to increase the efficiency of arbitration proceedings through improvement of advocacy. For this purpose, it has established the ASA Prize for Advocacy in International Arbitration – the first of which was awarded in 2010.” According to Mr. Schneider, the arbitration system in Switzerland can be described as modern and efficient. It has a clear and reliable legislative and juridical basis, while all challenges against awards are brought before a single instance, the Swiss Federal Supreme Court. “Arbitration in Switzerland benefits from an experienced network of academics, courts and counsel,” he said. “This network is largely supported by the work of ASA.” In 2004, six Swiss Chambers of Commerce (Basel, Berne, Geneva, Lausanne, Lugano and Zurich, joined more recently by Neuchâtel) harmonised their procedural rules and adopted uniform rules for international arbitration proceedings – the Swiss Rules of International Arbitration. The Swiss Rules can apply to any international arbitration whether the seat is in Switzerland or not (although Swiss arbitration law only applies if the place of arbitration is Switzerland), and are based on the UNCITRAL Arbitration Rules 1976, which are the most popular ad hoc arbitration rules worldwide. Mr. Schneider noted: “Switzerland has a long-standing tradition as one of the preferred countries for hosting international arbitration. A number of reasons may account for this success: political neutrality, a well-developed legal system, geographically convenient location, as well as the Swiss openness of mind for different values, cultures and perceptions of foreign parties coming to arbitrate in Switzerland.” Enforcement Switzerland has a very long arbitration tradition and established expertise in international arbitration. When international contracts between foreign parties are

negotiated, arbitration in Switzerland is very often a dispute resolution concept acceptable to both parties, notably because Swiss arbitration guarantees neutral, professional, high quality and efficient dispute resolution in a stable and competent environment. Peter Schaufelberger, Partner of SVH Schaufelberger & van Hoboken explained to Corporate International some of the benefits that arbitration could offer: “The competence of Swiss arbitrators is a big credit to the success of the system. Although the initial phase of arbitration (that includes filing of requests, constitution of the arbitral tribunal, cost advances, possibly also procedural issues etc.) may seem relatively long, the overall duration to obtain an enforceable award is generally shorter than in ordinary court proceedings due to limited possibilities of appeal. There has also been increased efficiency as a result of International enforcement pursuant to the New York Convention.” The Convention on the Recognition and Enforcement of Foreign Arbitral Awards, also known as the “New York Arbitration Convention” or the “New York Convention,” is one of the key enforcement instruments in international arbitration. The New York Convention applies to the recognition and enforcement of foreign arbitral awards within the member countries. Further, efficiency with regard to enforceability of international arbitration awards in Switzerland has been increased. For example, against a Swiss international arbitration award the exclusive appellate means available is an appeal to the Swiss Federal Tribunal, keeping in mind that the average duration of appellate proceedings usually does not exceed approximately four months, and remembering that the Swiss Federal Tribunal has only very limited authority to review a final arbitral award. As for appeals within the system however, there are very small chances of success. Approximately 95% of all appeals filed against international arbitral awards in Switzerland are dismissed. SVH is a leading Swiss law firm in Zürich-Zollikon, offering efficient, professional and individual services in all areas of business law. A dynamic, motivated and dedicated team of specialised attorneys provides competent and solution-oriented advice, designed for the particular needs of clients. SVH believes in offering international and domestic corporate clients and individuals a true alternative to large law firms. As a boutique firm, SVH combines high quality, specialised services with the personalised and tailor-made approach, transparency and efficiency of a smaller structure. International focus Eric W. Fiechter partner of the firm Secretan Troyanov working closely with Des Gouttes & Associés, the oldest Swiss law firm founded in 1834, believes that instead of looking inward, Switzerland should continue to build and market its strong legal reputation overseas and offer its arbitration and ADR services to foreign and multi-national organisations. “The big new challenge is to make Switzerland a place for arbitration also in commercial disputes involving Chinese counterparts. Being in the middle of Europe, without being a member of the EU should give any

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Arbitration in Switzerland

Michael E. Schneider - President

Dr Peter C Schaufelberger, LL.M. (Harvard ‘83) - Partner

Swiss Arbitration Association +41 61 270 6015

SVH Schaufelberger & van Hoboken + 41(0)44 396 21 21


Swiss arb sept 2011.indd 3

Eric W. Fiechter - Partner

Dr Felix Locher - Partner

Secretan Troyanov +41 22 789 7000

E. Blum & Co. AG +41 43 222 56 00

Urs Weber-Stecher - Partner

Nicolas Herzog - Attorney at law

Wenger & Vieli AG, +41 (0)58 958 58 58

Herzog & Gozzi +41 (0) 44 200 33 99

Dr Matteo Galante - Partner

Philippe Bärtsch - Elected Partner (as of 1st January 2012)

Molino Adami Galante +41 91 913 91 91

Schellenberg Wittmer +41 22 707 8000

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Arbitration in Switzerland

non-European parties the confidence that they can rely on a more neutral ground while giving the EU counterparts the security traditionally offered by good Swiss arbitrators,” said Mr Fiechter. Mr Fiechter further highlighted the benefits of using arbitration and how it can be advantageous to both Swiss and non-Swiss parties looking to settle disputes: “In most international cases arbitration is more suited than domestic litigation because documents need not to be translated and witness statements can be obtained in a more flexible way, with the panel of arbitrators meeting wherever it is the most appropriate, i.e. without having to seek approval by the official authorities to get witness statements. This can lead to very substantial savings in gathering evidence, without compromising the search for what really happened.” Due to its longstanding links with the United Kingdom, Russia and the United States of America and the international background of its lawyers, Secretan Troyanov together with Des Gouttes & Associés has established itself as a legal services provider of choice for international arbitration issues. In recent years Secretan Troyanov has published reports that offer essential advice about ADR in particular the importance of attempting to resolve disputes using mediation before arbitration. The reports feature case studies and examples that outline almost every possible situation where the need for ADR could arise. “Mediation should be tried without preconditions before arbitration or court proceedings whenever the parties can no longer communicate effectively, because the other party systematically misinterprets the communications, or refuses to focus on the real needs, except where the other party is quite obviously trying to elude its obligations, which requires normally some firmer action before a mediation has a chance of success. The intervention of a mediator can also help where the clients’ two lawyers have personal characteristics that make communication between them particularly difficult,” said Mr Fiechter. Foreign Favourite According to Dr Felix Locher partner and attorneyat-law for the Swiss firm E. Blum & Co. AG, Switzerland is a prime location for other countries to conduct their arbitration proceedings: “Foreign companies often favour Switzerland as one of the leading places for international arbitration due to its neutrality, the well-developed, modern legal system, the high professional standards, the geographically convenient location, as well as the excellent infrastructure. Swiss law and practices are also extremely arbitration-friendly.”

Dr Locher continued to explain the finer details of Swiss arbitration including the legal specifics involving jurisdiction disputes: “Any dispute involving a business interest or proprietary right is per se arbitrable in Switzerland, regardless of differing law in other jurisdictions. All IP disputes, including claims for invalidity and cancellation of trademarks, patents, copyrights and designs, may be made the subject of arbitration (with the exception of criminal sanctions and administrative proceedings). The country where the arbitral award may later have to be enforced may, however, follow a more restrictive approach. Enforceability of the award in foreign countries may thus require early (pre-trial) examination of the matter.” E. Blum & Co. AG is able to provide services in all matters relating to intellectual property (IP), including patents, trademarks, designs, copyright, and domain. The firm offers services as legal counsel and technical experts in arbitration matters relating to IP and are is in particular able to efficiently handle technically complex cases. The firm acts on behalf of Swiss clients and foreign clients. Arbitration is big business in Switzerland, and the country’s legal firms have diversified themselves to cover all aspects of the law that may be disputed in Switzerland. This includes intellectual property (IP), including patents, trademarks, designs, copyright, domain names and related fields. Firms must offer services as legal counsel and technical experts in arbitration matters relating to IP and in particular must be able to efficiently handle technically complex cases. Mr Locher also notes that in his opinion firms that have dedicated in-house teams comprising of legal and technical specialists, and act for Swiss based as well as for foreign clients will always have a dynamic advantage when it comes to dealing with arbitration matters. Efficiency and Professionalism Arbitration is often seen as an effective alternative in opposition to bringing cases before the state courts. Urs Weber-Stecher, partner of Wenger & Vieli AG, stressed the importance of the role of the arbitrators in modern day dispute resolution, and commented how the efficiency seen in the Swiss arbitration system is down to the individual legal professionals: “Today, the main advantage of arbitration is to have the ability to choose the best qualified experts to handle the case with great professionalism. State court judges are often unable or less qualified to cope with complex international cases appropriately. A second important advantage is the ability of the parties to help shape the procedure in a way which enables efficient handling of the case.”

Mr Weber-Stecher also commented how forming professional relationships with as many arbitration institutions as possible can be an excellent advantage to the firm and the services it can provide: “Switzerland has a well known and often proven set of arbitration rules laid down in the International Arbitration Rules of the Swiss Chambers of Commerce and Industry. Since we regularly work with these arbitration rules but also with the rules of other well known arbitration institutions, such as ICC, LCIA, DIS or VIAC, we are best prepared to advocate our clients’ position as counsel or to find the appropriate solution as arbitrators.” Despite the high praise given to this method of alternative dispute resolution and the legal professionals involved, one downside is the current cost. According to the Swiss Chambers’ Court of Arbitration and Mediation, organisations or individuals seeking arbitration services may face the combined costs of a registration fee, an arbitrator’s fee and most likely some sort of administrative cost during the legal proceedings. “In recent years the low costs were often mentioned as an advantage of arbitration. Today, compared to the Swiss court fees, in many cases this is not true anymore,” added Urs Weber-Stecher. Mr Weber-Stecher has been a lecturer for international arbitration at the University of Zurich since 2001. Wenger & Vieli’s arbitration team is active in all kinds of work for both national and international clients as counsel and arbitrators. The firm’s specialisations includes, commercial contracts, agency, distribution and license agreements, corporate law, intellectual property, banking law, and private international law. “The professional skills of our attorneys practising international arbitration are excellent. We work in small efficient teams limiting our work to what is really required but ensuring we do not lose sight of our goal to find the best solution for our clients or the parties in dispute. In this way, our work is particularly cost efficient,” added Mr Weber-Stecher. Working through the difficulties “One impediment to arbitrate a dispute may be the size of the litigious amount. If it is rather modest, arbitration is faced with the fact that it tends to be more expensive compared to Swiss state court proceedings,” explained Nicolas Herzog partner of the firm Herzog & Gozzi. Mr Herzog suggested that one solution to this predicament may lie in conducting proceedings before a sole arbitrator rather than a threeperson panel: “Yet in suggesting this idea, clients do sometimes shy away from this alternative. Given that in inter-

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Arbitration in Switzerland

national proceedings involving foreign investors the grounds of appeal before the Swiss Federal Supreme Court are extremely limited, it is understandable that a party does not wish to depend on a single person’s discretion and judgment. In such a situation and depending on the factual and legal questions at issue, it may be worthwhile to assess whether in fact a state court proceeding should be preferred, and if so, if and how the opposing party’s consent to waive arbitration can be obtained.” Another issue is the one of obtaining temporary relief prior to the constitution of the arbitral tribunal. “In such a situation a state court must necessarily fill the gap and issue a temporary order with the applied-for measures. Our firm has experience in advising litigants in obtaining such temporary relief, including the ex parte freezing of assets in Switzerland,” said Mr Herzog. Herzog & Gozzi exclusively undertakes commercial dispute resolution work and regularly represents foreign clients before Swiss courts and in arbitration proceedings. Being a pure-play dispute resolution boutique firm enables the firm to provide its services in a focused and cost-effective way. The firm’s independence and flexibility provide an ideal setting for optimally meeting its clients’ needs. The founding partners’ experience gained in a premier Swiss law firm ensures that any product of the firm meets uncompromisable standards of excellence and responsiveness. Moreover, the firm draws on know-how gained from the arbitrator role in ICC, ICSID and Swiss Rules proceedings. Although the ADR sector of Switzerland is strong, there are not a lot of strategies being

employed by the courts and the authorities in Switzerland to encourage the use of alternative dispute resolution. Mr Herzog clarified the current situation: “Under Switzerland’s new Federal Code of Civil Procedure courts may suggest to the parties mediation in lieu of litigation. Yet, unless all litigants agree to such proposal, mediation cannot take place. In contrast, courts and authorities do not actively encourage arbitration as it is up to the parties to agree on an arbitration clause in their contractual arrangements.” Strong in the face of global recession Arbitration has always been strong in Switzerland. After all, Switzerland is one of the world’s leading arbitration jurisdictions. Therefore it is possible that the global financial crisis has significantly increased the already high level of arbitrations currently ongoing in Switzerland. On the whole, Switzerland remains a safe and thriving place for businesses. Its political and legal systems are business-friendly and modern, and Switzerland has not been affected by the most recent debt turmoil burdening EU member states to a lesser or greater extent. Philippe Bärtsch, elected partner of Schellenberg Wittmer expressed his opinions on Switzerland’s strong global standing and the stability of arbitration services: “I believe the global economic downturn has not affected the number of people or the level of corporations choosing arbitration as opposed to other dispute resolution mechanisms. However,

our growing practice suggests that the current economic environment has led to an increase in the number of disputes, including disputes submitted to arbitration. For example, we have in particular seen in our practice a significant increase in the number of commodities and construction-related disputes.” Schellenberg Wittmer’s International Arbitration Group is one of the largest in Switzerland and is composed of leading specialists providing representation at the highest level in a broad range of complex commercial cases in a variety of fields. The firm has handled cases under a wide range of national laws and under major arbitration rules. Due to the diversity and size of the arbitration team as well as the international nature of the firm’s practice, Schellenberg Wittmer is able to offer clients a unique combination of skills and resources, during complex, cross-border disputes, including matters that have no direct connection with Switzerland (neither seat in Switzerland, nor Swiss law applicable to the merits). Mr Bärtsch added: “It is obviously very difficult to assess how the business environment will be developing in Switzerland in the next few years. As a mostly exporting country, Switzerland is dependent on the economic situation of other regions of the world. As far as arbitration is concerned, however, I am confident that Switzerland, due to its arbitration friendly legal system and the large pool of experienced arbitrators and counsel, should and will remain one of the preferred arbitration seats worldwide.” Switzerland has a long tradition of arbitration and it is expected that it will maintain its competitiveness and remain as a venue for international arbitration in the future.

“The competence of Swiss arbitrators is a big credit to the success of the system.”

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Dunedin acquires Red Commerce from Inflexion for £44m Dunedin acquires Red Commerce from Inflexion for £44m Dunedin has acquired Red Commerce, a global supplier of SAP experts to international corporations and consultancies, in a £44m buyout. Dunedin has bought the company from the original founder and Inflexion, the private equity house that led a £15m management buyout in 2005. Red Commerce, which was founded in 2000, now has a global footprint with access to over 200,000 SAP experts in 80 countries, and offices in the UK, Germany, France, Scandinavia, Switzerland and Brazil. Clients include Bosch, Johnson & Johnson and Novartis. Included within the Sunday Times Fast Track 100 for three consecutive years, Red Commerce’s most recent reported profits were ahead of budget at £5.5 million EBITDA. L.E.K. Consulting was appointed by Inflexion

to conduct a vendor commercial due diligence review of Red Commerce. Inflexion approached L.E.K. for its expertise in the recruitment sector and strong reputation in vendor due diligence. The review was led by Andrew Allum and Jeremy Wheatland, both Partners at L.E.K., and included a detailed analysis of the company’s historical performance, market position and customer relationships. Commentary was also provided on Red Commerce’s proposed business plan. Mr Allum commented: “Red has a strong reputation and market position in the fast growing, global market for SAP resources. We believe they have great prospects and wish them every success under their new owners.”

Advisor to Red Commerce

GG 149 Ltd acquires Ash & Lacey GG 149 ltd acquires Ash & Lacey

Hill & Smith has completed the sale of its wholly-owned subsidiary Ash & Lacy Building Systems (“ALBS”) to GG 149 Ltd, a newlyformed company. ALBS is a long established business engaged in the manufacture and distribution of metal external building envelope systems mainly supplied to the building and construction industry. The consideration of approximately £5.1million, which includes the repayment of net debt of £2.8million, is payable in cash upon completion and is subject to adjustment, based on the capital employed of ALBS, following finalisation of

completion accounts. Hill & Smith expects that a loss on disposal of £5.9million (including goodwill of £5.0million held on consolidation and written off) will be recorded in its financial statements as a non-underlying item. CEO Derek Muir said: “The disposal completes our strategic repositioning of Hill & Smith away from building and construction activities and enables the Group to focus upon the core higher added value businesses involved in infrastructure products and galvanizing services.” GoIndustry DoveBid Valuation Services was valuation provider with a team led by Elaine Shelley.

Finance provided by:

Hicorp95 acquires Leacy MG Birmingham-based classic car component supplier Leacy MG has been acquired by Hicorp95 in an undisclosed deal. David Keene, chief executive of Hicorp95, also based in Birmingham, said he was planning to build on Leacy’s reputation and service offering with the aim of expanding its current product range of over 50,000 line items. In addition, Leacy MG will change its name to Leacy Classics and will be launching a new website. The deal was backed with equity funding from Cedar Invest and NatWest and Springboard Corporate Finance, Harvey Ingram, HBJ Gateley Wareing and BDO advised. Mr Keene said: “I am delighted to be leading Leacy MG into the future. We are keen to ensure the historical depth of knowledge, reputation

for good customer service and high level of stock holding are maintained. We aim to enhance the company’s ability to stock a wide variety of vehicle marques and supply the international market as we move forward.” Nic Hanlon, structured finance director at NatWest, added: “This is a business operating in an established market and provides evidence of the good investment opportunities that exist in the West Midlands.” Diligencia LLP undertook management due diligence for NatWest with a team led by Tim Worrall, Partner at the firm. Commenting on the deal, Mr Worrall said: “This is an MBI, part-funded by an HNWI, a situation that generally produces some interesting interpersonal dynamics, and the HiCorp/Leacy deal was no exception.”

Hicorp95 acquires Leacy MG

Management Due Diligence Provider:

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McGuireWoods represents EO Group Limited in Sale of Ghanaian Oil Interests McGuireWoods represented EO Group Limited in the sale of its 3.5% interest in the West Cape Three Points Blocks and 1.75% interest in the Jubilee Field, both offshore Ghana, to Tullow Oil Plc for approximately $305 million. Successful completion of the deal was announced to the London Stock Exchange on 25 July. Partner David Ronn (Energy and Environmental, Houston TX) is the principal partner for EO Group. Lawyers principally involved in this deal were partners Robert Rakison (Corporate, London) and Bob McElroy (Tax, Richmond VA) and senior associate Daniel Burns (Corporate, London). They were assisted by partners Philip Newhouse (Corporate, London), Adam Greaves (Business and Securities Litigation, London), senior counsel Thomas Taylor (Tax, Wilmington

NC), associate Bradley Ridlehoover (Tax, Richmond VA), staff attorney J. Christian Tennant (Tax, Richmond VA) and trainee solicitor Julia Lewellen (Corporate, London). Commenting on the deal, Mr Ronn said: “This was an important deal for the client. The client was in a position where a number of complex issues needed to be resolved within strict time limits to get the deal ‘over the line’ in a way that would be satisfactory to all interested parties.” Tullow is an independent oil and gas, exploration and production group, listed on the London, Irish and Ghana stock exchanges and is a constituent of the FTSE 100 Index. Tullow was represented in this transaction by Freshfields Bruckhaus Deringer in London.

EO Group Limited in $305 million sale to Tullow Oil plc

Legal adviser to EO Group Limited:

Legal adviser to Tullow Oil plc:

NVM Private Equity completes the trade sale of Promanex Group to Costain Group NVM Private Equity Limited (NVM), the UK independent private equity business, has announced that it has successfully exited Promanex Group Holdings through a trade sale to Costain, one of the UK’s leading engineering solutions providers. Mark R Dixon established Promanex in 1996 initially consisting of a group offering added value service and maintenance. It provided Total Facilities Management (TFM) services to the power generation and general industrial sectors. Based in Warwickshire, Promanex operates in the UK and Ireland with a workforce of over 800 highly skilled maintenance employees. The company’s client base consists largely of major blue chip customers such as Conoco Phillips, EDF, E.ON, Magnox, RWE, Scottish and Southern Energy, Siemens and Total.

Berkshire based Costain has acquired 100% of the issued share capital of Promanex. The consideration for the acquisition, including debt, is £18.8 million. Mr Dixon and the rest of the management team will remain with the business to ensure a successful integration into Costain’s infrastructure division and to ensure continued growth in the business. The sale represents a total return of 1.6 times on NVM’s combined investment. James Arrowsmith who led on the deal for NVM Private Equity Limited said: “As well as providing the funding for the original MBO, NVM supported the company with further investment two years ago. The investment has delivered good financial returns and the sales and profit growth achieved by the company since the involvement of NVM demonstrates the value that can be added by private equity funding.”

NVM Private Equity completes the trade sale of Promanex Group to Costain Group

Equity provider:

Hotbed agrees to acquire Camberley Premier Inn Hotbed acquires Camberley Premier Inn UK private investor syndicator, Hotbed, has completed a forward commitment to purchase the newly constructed Premier Inn hotel in Camberley, UK for £6.7million. The purchase, at a net initial yield of 6.18%, will be paid for with a £3.4million equity investment by Hotbed members and £3.3million debt provided by Santander. The forward commitment stipulates that the hotel will be leased to Premier Inn Hotels for 25 years, with a tenant break in the 20th year. Headquartered in London, Hotbed is a specialist supplier of alternative asset investments where direct private equity and commercial property investments are made available in £25,000 units. Commenting on the deal, Andrew Whitely, co-head of property at Hotbed, said: “There are

a limited number of investment opportunities available that provide a true hedge against inflation. This is why our Premier Inn and Travelodge deals, as well as Hotbed’s ground rents portfolios, have been some of our most popular recent investments, each attracting a large number of investor members.” This investment marks Hotbed’s third hotel investment in the last twelve months. Pricewaterhouse Coopers LLP provided SDLT and structure advice on the transaction. Stephen Coleclough - Head of PwC’s Stamp Taxes Network - led on the deal, assisted by associate, Orla Lowe. The firm was introduced to the deal through Simon Ingram of EMW Law in Milton Keynes.

Provided structure advice:

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OMERS Private Equity acquires V.Group Ltd Omers Private Equity Acquires V.Ships V.Group’s senior management has teamed up with OMERS Private Equity in the buy-out of V.Group, parent company of V.Ships. OMERS will support the further growth of the global supplier of ship management and related marine including offshore services replacing Exponent Private Equity as V.Group’s financial partner. Commenting on the transaction, Clive Richardson, CEO V.Group - who will continue to lead the management team - said: “I look forward to partnering with OMERS Private Equity in continuing to build a market-leading company delivering outstanding service and value to our customers.” Mark Redman, Senior Managing Director of OMERS Private Equity in Europe commented: “V.Group has an attractive and differentiated outsourcing-based business model and is led by an exceptional management team. We believe

that V.Group’s extensive global network, track record of profitable growth, compelling customer value proposition and breadth of services provides significant long-term potential.” Financing for the transaction with an enterprise value of US$520m was provided by RBC Capital Markets. V.Group was advised by Lazard, with further transaction support provided by Allen &Overy, PricewaterhouseCoopers, Deloitte and BCG. Kinmont and Travers Smith advised V.Group’s management. Estin & Co provided strategic due diligence on the transaction with a team led by Marco Maeder. Commenting on the deal, Mr Maeder said: “For the V.Group deal we used our expertise in the marine sector to assist OMERS in a strategic audit of the company. This was a particularly interesting acquisition given the strong growth prospects of V.Group within this fast-moving industry.”

Legal Advisors & Due Diligence providers:

China New Energy Placing New China Placing Admission to AIM China New Energy Limited (“CNE”), an engineering and technology solutions provider to the bioenergy sector, announced its admission to trading on AIM and the commencement of dealings in its ordinary shares under the ticker symbol CNEL. The Company raised £655,210 through the Placing of 9,360,147 new Ordinary Shares at 7p per share. The market capitalisation of the Company at the Placing Price on Admission was £20.8million. Cairn Financial Advisers LLP acted as Nominated Adviser in relation to the Admission and SVS Securities plc acted as Financial Adviser and Broker. Stephenson Harwood was legal adviser to China New Energy Limited, with a team led by Matthew Gorman. The firm was introduced to the deal by Foo Shiang Peow, NED of CNE. Commenting on the deal, Mr Gorman said: “The placing demonstrates the continued appeal of AIM for Asian/Chinese companies; the ongoing attractiveness of

the alternative energy space to investors; and the fact that the London investment community still recognises the value of well managed growth businesses with a focused business plan and a professional approach.” Crowe Clark Whitehill was reporting accountants on the transaction. Robin Stevens, the corporate finance partner at the firm who led the deal, said: “The Company has historically been operating principally in China, with some activities in Europe. The listing on AIM will help the Company to raise its profile generally, but particularly in Europe where the Company plans to expand its market presence. The CNE transaction demonstrates the clear advantages of international status, combined with good governance and a practical principles based admission process, that AIM has compared with many stock markets in Asia and the US. That is why many overseas Companies continue to chose London rather than local or regional stock markets.”

Solicitors to company:

Reporting Accountant: Reporting accountants:

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RJD backs Verdant Leisure’s first bolt on acquisition Verdant Leisure (“Verdant”), owner and operator of two well established holiday parks in South East Scotland, has completed its first acquisition, adding Viewfield Manor, a holiday park located a few miles inland from the Ayrshire Coast and c.20 miles from Glasgow, to its portfolio. RJD Partners (“RJD”) one of the leading UK lower middle market private equity investors, first invested in Verdant in September 2010, backing a highly experienced leisure sector management team in a management buy-in of Dunham Leisure Limited, the then owners of the Pease Bay and Thurston Manor parks. The Verdant team comprising Graham Hodgson as Chief Executive, Andrew Wall as Finance Director and Bev Dixon as Operations Director, recognised that these two parks offered an at-

tractive platform from which to implement a buy and build strategy to create a larger regional group with significant scale. Verdant’s first bolt-on acquisition, Viewfield Manor, is a 298 static pitch site offering significant development potential. The vendor was a private family vehicle. Frazer Coogans Commercial Solicitors conducted commercial property work on the transaction with a team led by Norman Geddes and Peter McNamara. Commenting on the deal, Mr McNamara said: “This is the third major deal completed by Frazer Coogans this year. There is strong activity in the Leisure market at present; we were able to assist as we have wide experience in the Commercial property market.”

RJD backs Verdant

Legal Advisor:

Technology in Motion acquires Ossur in MBO Healthcare company Technology in Motion is preparing for expansion after changing hands in a management buyout (MBO). The firm, which is based in Whinmoor, Leeds, plans to create franchises throughout the UK and Ireland this year following the acquisition, for an undisclosed sum, from Iceland-based orthopaedic products and prosthetics firm Ossur. Technology in Motion, a wholly-owned subsidiary of Ossur, which has its UK base in Manchester, has a £500,000 turnover, three full-time staff and satellite clinics in London, Bristol, Coventry, Manchester and Glasgow. The company was acquired by its business development manager, Steve Mottram, and clinical specialist Sandie Waddell. The acquisition includes the business and products of Technology In Motion, which pro-

vides orthopaedic braces and supports for knee and ankle injuries and osteoarthritis sufferers to patients as well as cranial remoulding treatments for children with plagiocephaly, known as flathead syndrome. Godloves Solicitors provided corporate transactional advice with a team led by Michael Cantwell, Head of Corporate. Commenting on the deal, Mr Cantwell said: “We are delighted for our client Constellation Orthopaedic Holdings Limited. The acquisition of Technology In Motion Limited and its future development by management will clearly reinforce its position in the industry as a market leader. We have been extremely impressed by the level dedication and care shown by Stephen and Sandie toward their clients and the level of professional services provided by Garbutt & Elliott.”

Tech in Motion MBO

Legal Advisors:

Weedon Holdings buys Rowpak Containers Weedon Holdings buys Rowpak Containers

UK-based Weedon Holdings Group has acquired Rowpak Containers, a manufacturer of corrugated packaging based in Audenshaw, Manchester. The acquisition will enable Weedon to manufacture some of its own corrugated sheet board, adds the facility for high volume case-making to the group’s portfolio and gives it a base in the North of England. Weedon said the acquisition is expected to double the group’s annual turnover to £20m and will also secure the future of Rowpak’s operations,

where 100 jobs have been under threat. The acquired firm will be known as Weedon Corrugated Products and will continue to operate as an independent business. Weedon Holdings is a family-run business which already includes Weedon PSC, a manufacturer of retail ready packaging and point of sale display units; and retail own label packaging specialist i2i europe. Shaun Knight of Baldwins Ltd West Midlands branch provided financial advice on the transaction

Baldwin and Co:

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Who’s Who CONTENTS PAGE Competition Law p69

An insight into the global competition/antitrust sector.

Global Corporate Immigration p72 An overview of corporate immigration specialists from around the world.

Insolvency Law p76 An insight into the global insolvency sector.

September2011Contents.indd 2

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Competition law

COMPETITION LAW GUIDE Key Contact: Antitrust and Trade Law Section of the International Bar Association

Monitoring and maintaining competition in global markets has become an integral part of the global business environment and a mainstay of the business pages worldwide recently. This pressure and scrutiny on global conglomerates has given rise to some landmark competition cases. Competition law differs from country to country around the world, but all regimes are based on the same fundamental issues of controlling collusion and anti-competitive practices, such as cartels and price-fixing, that can lead to falsely dominant positions in the market and an unfair advantage over other companies. Competition law in Europe European Community competition law is one of the areas of authority of the European Union (EU). The EU is one of the largest economic blocks in the world and thus EU competition law is particularly influential. It is regarded by the European Commission as an integral part of ensuring the completion of the internal market, meaning the free flow of working people, goods, services and capital in a borderless Europe. The European Court of Justice has endeavoured to give the term ‘trade between members states’ a broad definition, in order to make it applicable to as many situations as possible. Competence for applying EU competition law rests with the European Commission and its Directorate General for Competition. On the 1st of May 2004, a decentralised regime for competition law came into force, to increase the application of EU competition law by national competition authorities

CHINA Liyong Jiang, Partner Gaopeng & Partners – Prc Lawyers +86 10 5924 1159

Founded in 1998, Gaopeng & Partners has become an integrated law firm with its headquarters in Beijing and branches in major cities. As a pioneer in the competition field, Gaopeng’s lawyers have provided a large amount of anti-monopoly and anti-unfair competition legal services to clients. Liyong Jiang, partner, noted: “Gaopeng lawyers have taken an active part in drafting the Chinese anti-monopoly laws, by providing consultation and recommendations to the legislators. The firm has also maintained a close working relationship with administrative agencies responsible for anti-monopoly and anti-unfair competition, such as the Office of Legislative Affairs of the State Council, the Ministry of Commerce, the National Development and Reform Commission and the State Administration for Industry and Commerce. This enables them to be the first to learn about changes and developments in Chinese laws and policies.” When asked to summarise some of the key competition issues for companies operating in China, Mr. Jiang added that threshold and timeline are important for merger control in China. He said: “If a merger or acquisition meets the threshold stipulated by the Anti-Monopoly Law, the transaction shall be notified to MOFCOM. The threshold requires that the aggregate global turnover of all operators exceeds RMB 10 billion, and at least two of the operators each has a turnover of more than RMB 400 million; or, the aggregate domestic turnover of all operators exceeds RMB 2 billion, and

and national courts. Competence for enforcing EU competition law is now shared between the Commission and the national authorities. Antitrust law in the USA The American term antitrust arose not because the US statutes had anything to do with ordinary trust law, but because the large American corporations used trusts to conceal the nature of their business arrangements. Big trusts became synonymous with big monopolies. The perceived threat to democracy and the free market these trusts represented led to the Sherman and Clayton Acts. These laws, in part, codified past American and English common law of restraints of trade. Senator Hoar, an author of the Sherman Act, said in a debate: “We have affirmed the old doctrine of the common law in regard to all inter-state and international commercial transactions and have clothed the United States courts with authority to enforce that doctrine by injunction.” Competition law has already been substantially internationalised along the lines of the US model by nation states themselves; however, the involvement of international organisations has been growing. Increasingly active at all international conferences are the United Nations Conference on Trade and Development (UNCTAD), as well as the Organisation for Economic Co-operation and Development (OECD). Further, while it is incapable of enforcement itself, the recently established International Competition Network (ICN) is a way for national authorities to coordinate their own enforcement activities.

at least two of the operators each has a turnover of more than RMB 400 million.” Failure to make a filing will result in a fine up to RMB500, 000, or undoing the transaction. Also, compared to other jurisdictions, the anti-monopoly review by MOFCOM may take a longer time – which will affect the timetable of closing of transactions. To accelerate the procedure, the notifying party shall start to prepare for the filing as early as possible, and make every effort to reduce vagueness in the filing documents so as not to invite unnecessary questions from MOFCOM. Mr. Jiang added that, meanwhile, China has not suffered from the global economic downturn. “On the contrary,” he said, “the Chinese economy continued to grow in the first half of 2011 due to expansion of domestic investment and consumption. M&A remains active in China, and cases of merger filing also increased steadily according to statistics of MOFCOM. Private litigation – mainly against abuse of dominance – also shows signs of increasing, since the Anti-Monopoly Law is deemed by consumers and small companies as a good tool to challenge the bargain power of the giant company. “This fast growth of the Chinese economy also leads to inflation. Therefore, the Chinese government also wishes to take advantage of the Anti-Monopoly Law to crack down on cartels. In 2011, authorities have announced at least two decisions on punishment of cartel activities.” In recent months, Gaopeng has successfully assisted several clients for obtaining the approval of MOFCOM for their merger filings. The average amount for transactions attended to by Gaopeng has exceeded 500 Million USD. For the remainder of 2011, moving into 2012, Gaopeng plans to strengthen its position in both areas of merger filing and counselling – in order to best meet the need of clients.

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Competition law

COSTA RICA Claudio Donato, Partner Zurcher Odio & Raven +506 2201 3817

Zurcher Odio & Raven (ZOR) is a consolidated law firm in Costa Rica, committed to offering the best legal services in the country. The firm represents large- and medium-sized companies, both national and multinational, professional associations, financial institutions, public offices and individuals. The law firm also has a consolidated area of practice in Competition and Antitrust Law. Its experience includes handling cases of abuse of market position, monopolies, and restrictions to free competition, unfair competition and misuse of privileged information. Services include, among others, solutions to common antitrust questions, claims of clients and the defence against claims of others in antitrust litigation, compliance programs and complete assessments of a company. The antitrust team area of practice is led by partner Mr. Claudio Donato, who has extensive experience in the field, and presided the National Competition Commission and attorney Mr. Marco López, specialist in regulatory law and administrative proceedings. Further, the firm represents clients in formal proceedings, and has extensive litigation experience including participation in hearings and appeals before the National Competition Commission and the Costa Rican Courts. Mr. Donato noted: “ZOR has participated actively in different national forums discussing antitrust issues, and has handled various cases before the competition authorities. However, what distinguishes our firm is our

GERMANY Dr. Sebastian Jungermann, Partner Kaye Scholer +49 69 25494 300

Kaye Scholer was established in New York City back in 1917, with an additional Frankfurt office set up in 2001. Today, the members of the German office advise clients on international litigation and transactional matters. The focus of the practice in Frankfurt reflects the firm’s overall strength in antitrust, litigation, corporate reorganisations, mergers and acquisitions and complex financings, as well as general corporate work. Kaye Scholer’s Antitrust practice brings together attorneys from the firm’s Frankfurt, Washington D.C., New York, and Los Angeles offices. This highly skilled and diverse team includes lawyers who served with antitrust agencies and attorney’s general offices, as well as former federal prosecutors and corporate counsel. The firm’s practice boasts a wealth of experience in addressing the wide range of competition law issues confronted by international clients in litigation, merger control and counselling situations. Dr. Sebastian Jungermann, partner with the firm, noted that when clients contemplate complex transactions, they require prompt, insightful advice and effective representation before the German Federal Cartel Office, the European Commission and before other authorities that decide whether to permit or challenge them. “They get both from Kaye Scholer,” he said. “Our lawyers know what questions to ask in order to understand both the essence and details of a proposed transaction quickly – as well as how to develop and present the

experience in legal counsel for large corporations with dominant market positions, with a focus on prevention.” When asked about some of the main competition law issues that may arise for companies operating in Costa Rica, Mr. Donato said: “Concentrations with anticompetitive effects are prohibited in Costa Rica. In Costa Rica, there are no pre-merger mandatory filing or authorisation requirements. Consequently, in different M&A procedures, our firm must provide a proper due diligence analysing the merger effects in the market with respect to the antitrust laws.” As regards the measures that companies can put in place to ensure compliance with Costa Rica’s competition rules, Mr. Donato added: “Our experience indicates that the most important aspect for companies, especially those with a dominant market position, is to have employee training and compliance programs regarding illegal and correct competition practices. ZOR closely follows the jurisprudence from our competition authorities, and provides advice and training taking into consideration the legal effects of the rulings of the competition authorities.” In terms of the consequences of non-compliance, fines of up to 680 times the domestic minimum salary – approximately $450 – may be imposed for illegal practices in Costa Rica. In particularly serious cases, fines of up to 10% of the parties’ sales in the previous year, or 10% of their assets, may be imposed. “Although the penalties may be high, these are not the only costs that the company must cover in a legal proceeding,” said Mr. Donato. “Therefore, the most important companies have understood that the best defence against antitrust penalties and proceedings is prevention through training and compliance programs for key company personnel – such as those responsible for the preparation of commercial policy and management. ZOR has extensive experience in that particular area.”

client’s story to the authorities in a manner that will achieve the desire results.” In recent years, Kaye Scholer has obtained approvals for combinations in the communications, consumer products, defence, entertainment, Internet, pharmaceutical and tobacco industries, including approvals that surprised antitrust commentators and the market alike. In some instances, the firm teamed up with one or more other law firms working with the client on a transaction and created what Dr. Jungermann refers to as a “virtual” firm for the purpose of the transaction – enabling a multi-firm, multi-city team to provide the client with a seamless mix of the precise talents needed for the particular transaction. Dr. Sebastian Jungermann added: “Companies may confront multifaceted antitrust risk, resulting from employees’ conversations with friends and former colleagues who now work for competitors, which may later be misinterpreted by regulators, plaintiffs’ counsel, or customers – leading to years of expensive and uncertain litigation.” Further, he said that a new marketing and sales plan may represent the company’s market share in a way that is later viewed as implying a dominant position. The company’s desire to capitalise on a healthy portfolio of IP rights may raise antitrust concerns. Effective counselling – provided by lawyers who understand both the law and the client’s business – is the proverbial ‘ounce of prevention’. He concluded: “Kaye Scholer’s Antitrust practice group provides such counselling to clients on the timetable required in today’s business environment – whether the issue is a proposed joint venture, an IP licensing program, a customer relationship or a new marketing program for a flagship product. By learning our clients’ objectives and operations, we help them achieve their goals.”

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Competition law

Hulda Árnadóttir

ICELAND ROMANIA Alexandru Codescu - Partner Tanasescu Leaua Cadar & Asociatii +4 031 405 43 04 SWITZERLAND Philipp Zurkinden, Partner Prager Dreifuss Ltd. +41 44 254 55 55

Þórunn Guðmundsdóttir

Heimir Örn Herbertsson

LEX +354 590 2600

Comprised of 45 lawyers, LEX is one of Iceland´s largest law firms. Over the past decades, LEX has successfully acted on behalf of a large number of internationally respected corporations, organisations and private individuals both in Iceland and abroad. LEX is also a member of Lawyers Associated Worldwide (LAW). The firm provides comprehensive services in the field of competition law and has represented many clients in proceedings before the Icelandic Competition Authority (ICA) as well as the Appeals Committee, both complainants and targets of investigation. Further, LEX provides all necessary services in respect of merger control, ranging from the assessment of whether a merger requires notification, to the preparation and filing of a notification and representation before the ICA and the Appeals Committee. Hulda Árnadóttir is a specialist in European law, competition law, media law, IP law and property law at LEX. Ms. Árnadóttir said that from an M&A perspective, it should firstly be noted that all mergers meeting specified turnover thresholds must be notified to the ICA. She explained: “Any violation thereof can lead to a fine. Secondly, it is important to observe that the ICA has up to 115 working days from reception of a satisfactory merger notification to reach a decision on SWITZERLAND whether to allow the merger, annul it or allow it with conditions.” Scherer Matthias - Partner (Geneva) It is therefore essential to file a notifiLalive cation in a timely manner. It is moreover vital to present all required0041 information (0)22 319in 87the 00 tion; if not, it may be deemed unsatisfactory and the above mentioned time limit accordingly adjusted. Thirdly, it is imperative to note that a merger falling under the notification regime cannot be executed until the ICA has taken a positive decision to that extent. Any infringement thereof can result in a fine. LEX offers general advice on competition law compliance, and has assisted a number of clients in preparing a framework within their establishments for that purpose. This is a growing demand – as the consequences of non-compliance can be severe and may lead to high fines and, in some cases, imprisonment of the individuals involved in the infringement. Ms. Árnadóttir also noted that Iceland was hit hard by the global economic crisis and, consequently, a larger number of companies have been taken over by the banks for restructuring. She said: “This has led to a heavy merger case load with the ICA, and has presented several issues from a competition law perspective. “To date, the ICA has habitually allowed such mergers with a set of conditions to ensure effective competition in the relevant markets. Financial restructuring of many of these companies has now been completed, and the relevant companies sold to new owners or, alternatively, returned to their old owners. What effect this will have on compatition in the relevant markets remains to be seen; however, it is already clear that many companies that behaved cautiously prior to the downturn perceive themselves as being at a competitive disadvantage following such measures.”

Prager Dreifuss Ltd. is a medium-sized full service law firm in Zurich, Switzerland with approximately 30 attorneys. The firm is home to further offices in Brussels and Bern, where its competition law team is based. For more than ten years, Prager Dreifuss’s competition law specialists have been serving domestic and international clients in antitrust and merger proceedings. The team consists of Dr. Philipp Zurkinden, Dr. Marino Baldi, Dr. Christoph Tagmann and Bernhard Lauterburg, Marino Baldi is considered the intellectual father of the Swiss Cartel Act and was, until recently, a member of the Competition Commission. Meanwhile, Philipp Zurkinden and Christoph Tagmann have long-standing experience in competition law owing to their previous positions in the commission. With regard to merger control Dr. Zurkinden noted: “International clients operating in Switzerland need to be aware that upon reaching certain triggering events and thresholds, mergers and acquisitions in Switzerland must be notified to the competition authorities for clearance – as is the case in many other jurisdictions.” He added that following notification, the concerned undertakings must refrain from implementing the merger or acquisition for a month, unless the Commission has at their request authorised them to do so for good cause. If the Commission does not open an in-depth investigation, it may be implemented. The notification thresholds are the following: The combined aggregate turnover of the concerned undertaking is at least CHF 2 billion or the combined aggregate turnover in Switzerland is at least CHF 500 million. The individual turnover in Switzerland of at least two of the concerned undertakings is at least CHF 100 million. Notwithstanding these thresholds, notification is mandatory in Switzerland, if one of the concerned undertakings has been previously declared dominant in a specific market in Switzerland. When asked what measures can companies put in place to ensure compliance with Swiss competition rules, Dr. Zurkinden explained that companies operating in Switzerland will find an increasingly strict regime against anti-competitive behaviour. Companies should therefore implement corporate polices and ensure that employees are aware of the consequences of non-compliance with competition rules. “Although the implementation of such policies will not release an undertaking from liability, the Commission may take them into account as a mitigating factor in the determination of the applicable sanction,” he said. “Non-compliance with competition rules may result in administrative sanctions against the non-complying undertaking up to 10% of the turnover achieved in Switzerland in the preceding three financial years.” Meanwhile, Switzerland was not spared the detrimental effects of the global economic downturn, and local producers are battling to remain competitive in the face of rapidly falling foreign exchange rates vis-à-vis the Swiss currency. The competition authorities are aware of this issue and will appropriately respond if they find that such price differences result from restrictive business practices or an abuse of a dominant position. “Prager Dreifuss Ltd., with its strong national and European network and resources, is excellently poised to advise as regards regulatory demands on multinational and domestic companies.”

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Global corporate immigration

Global Corporate Immigration Immigration is playing an increasingly important role in global business as companies operate across multiple jurisdictions, and labour moves more freely around the world. Corporations often need to act quickly to move appropriately skilled people across jurisdictions, depending on workflow, contract wins or economic developments. A good immigration lawyer can help smooth the process, employing an expert knowledge of a particular country’s immigration procedures to eliminate mistakes and secure appropriate visas as quickly as possible. This can mean the difference between contracts won and lost, deadlines met or missed, and satisfied or unhappy clients. The role of the immigration lawyer An immigration lawyer will be on hand to provide advice in all areas of corporate immigration including business visitor visas, temporary work and residence permits, entry clearances, entry visas and passports, guidance for security and medical clearance processing, visa issuance and counselling on entry and departure procedures. Other areas of assistance include document procurement, including acquisition, translation, legalisation and apostilles, advice on short-term assignment planning and back-to-back assignment strategies, business traveller and passport services, as well as student-related matters and maintenance of status. An immigration lawyer can also advise clients with regard to the immigration aspects of mergers and acquisitions, divestitures and corporate reorganisations.


Travelling in the EU for business purposes Ensuring that key employees are in the right place at the right time is an essential business need as it maximises business performance and efficiency. This is perhaps even more important in the current economic climate. For those travelling within the EU for business purposes the Schengen Visa has made traveling between its 15 European member countries much easier and less bureaucratic. Travelling on a Schengen Visa means that the visa holder can travel to any (or all) member countries using one single visa, thus avoiding the hassle and expense of obtaining individual visas for each country. This is particularly beneficial for persons who wish to visit several European countries on the same trip. The Schengen visa is a ‘visitor visa’. It is issued to citizens of countries who are required to obtain a visa before entering Europe. Non compliance The consequence of non compliance with immigration legislation varies from country to country. However, punishment can be extremely severe and companies that continue to operate in violation of frequently changing rules have suffered severe penalties, including criminal prosecution of executives, workers, and large fines.

Yoshio Shimoda, Managing Partner ILS Shimoda Office L.P.C. +81 3 5521 1901

ILS Shimoda Office L.P.C. exclusively provides legal services related to Japanese immigration cases. The firm’s services includes vicarious applications with the immigration authorities such as for certificate of eligibility, extension/change of status of residence, and permanent residency, together with the relevant document preparation and consultation both in English and Japanese. As one of the leading firms in the field of corporate immigration, with its cumulative handling of nearly 50,000 cases since its establishment, ILS Shimoda Office provides services through consultants with ample experience and knowledge, and fluency in Japanese and English. The firm also uses a qualified personal information protection system. Yoshio Shimoda is a managing partner at ILS Shimoda Office L.P.C. When asked to describe Japan’s current status as a business location, Mr. Shimoda noted: “Despite its suffering from the Great East Japan Earthquake on March 11th, 2011, Japan still has the potential to attract foreign businesses as one of the centres of the Asian economy. Its currency is intensifying its strength in the global market – and the region also offers a stable supply of safety and social infrastructure.” Today, Japanese immigration laws divide the resident status of foreign nationals into 27 categories. Of this, Mr. Shimoda said: “We analyse each applicant’s case based on their respective circumstances and relevant documents, in order to determine and prepare for the most appropriate status.” For example, he explained, when business persons accompany family members on their stays in Japan for long-term assignment in Japan, the family members who are allowed equally long-term stay visa-wise have historically been limited to their legal spouse and children with only small amount of exceptions.

“The people who do not select the wedlock-based family style are on the increase,” he said. “A good example of this is the common-law-based spouses and their children. When a client intends to accompany such ‘family’ members for his/her assignment in Japan, we provide our utmost effort, with predominantly successful results, to help them obtain an appropriate status of residence within the capacity of the currently valid relevant laws.” As regards the future of the immigration sector in Japan, in 2009, a bill to revise the Immigration Control and Refugee Recognition Act and Pertinent Laws was passed. Mr. Shimoda said: “The significant parts of these revised laws are scheduled to be made in effect by July 2012, namely: replacement of the current Alien Registration Card by Alien Residence Card (Zairyu Card) for the immigration authorities to collectively control the relevant data; the alleviation of the re-entry permit to exempt foreigners to obtain one for travels abroad within one year; and the extension of the longest allowable status of residence from the current three years to five years.” He added: “Besides the above, the government is scheduled to introduce, by the end of 2011, a benefit point allocation system to foreign nationals working in Japan – in order to attract more foreign nationals with highly skilled experience and expertise.”

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Global corporate immigration


Timur Beslangurov, Managing Partner VISTA Foreign Business Support +7 495 933 7822

VISTA Foreign Business Support offers professional legal advice and support to foreign companies doing or planning to do business in Russia in the fields of corporate immigration, labour, tax, accounting and corporate matters. According to Timur Beslangurov, managing partner at the firm, Russia is a very attractive location in which to do business as it is constantly developing – there is high buying power, and there are still sectors where completion is quite low. When asked about some of the legal complexities associated with immigration in Russia, Mr. Beslangurov said: “Russian immigration legislation is relatively new and, therefore, there are consistently new laws and regulations in development. This requires not only monitoring of these amendments, but also a proper understanding of such developments, as well as obtaining official opinions from the government in cases where this is required.” He added: “Our firm always monitors such amendments, and works closely with the immigration authorities to obtain clarifications from them on any controversial issues.” As regards the attractive features that Russian immigration law offers to potential foreign investors, as of the 1st of July 2010 Russia has adopted a new law which introduces a new category of work permit applications – the Highly Qualified Specialist (HQS) work permit. The main criterion to qualify for such a work permit is the amount of annual salary that has to be paid in Russia to a foreign worker. HQS work permits make it possible to obtain a three-year work permit and a three-year work visa – instead of a one-year work permit and visa as applies for standard procedure. Further, the processing time for HQS work permits is only three weeks, instead of four months for a standard procedure. When asked how Russia – specifically the immigration sector – fared during the global economic downturn, Mr. Beslangurov explained: “From our experience there weren’t many companies that have reduced their expatriate population in their Russian

US – Minnesota

offices; moreover, certain companies were even increasing the number of expatriates. Now – after the onset of the crises – we see more and more companies increasing their expatriate population, especially with the new HQS procedure being enforced.” Russian immigration laws are constantly developing – and there may indeed be further changes in the future. To this end, Russia consistently works with such countries as the US, as well as locations within the EU, to agree on benefits for both parties in the immigration sphere. Apart from working closely with the labour and immigration authorities in Russia, VISTA Foreign Business Support also maintains good relations with the Russian embassies worldwide, which is very useful for its clients, as consular procedures differ from embassy to embassy, and professional support is often needed. Established in 1997, VISTA Foreign Business Support has – since 2002 when the immigration legislation was adopted – helped hundreds of foreign companies with their immigration, tax and labour needs connected with bringing foreign employees to Russia. Mr. Beslangurov concluded: “There are 40 lawyers situated within the firm, including 20 within the immigration department. Annually, we process approximately 1,500-1,800 work permit applications – not only in Moscow, but in more than 20 regions of Russia.”

Myers Thompson P.A. +1 612-349-3030 Elizabeth Thompson – Sam Myers –

Myers Thompson P.A., located in Minneapolis, MN, strives to be the highest quality immigration law firm in the US. The firm’s partners earn their clients’ trust every day – and the quality of their clients proves it. Myers Thompson’s client base consists of both small- and medium-sized regional employers as well as large, international employers with operations throughout the US and the world. In addition, many clients prefer the firm to act as a central source of their US immigration case processing in order to ensure consistency, predictability and control over this important aspect of their operations. Sam Myers and Elizabeth Thompson own and run the firm. For many years, Mr. Myers and Ms. Thompson have been listed in the national publications, Best Lawyers in America, An International Who’s Who of Corporate Immigration Lawyers and in the regional publication Law and Politics, as ‘Superlawyers’ for their accomplishments in the field of immigration law. For the past several years, Mr. Myers has been recognised as one of the most respected corporate immigration lawyers by the International Who’s Who of Corporate Immigration Lawyers. This firm also maintains a team of 17 attorneys, case managers and administrators, comprising a diverse team of immigration professionals with a stunning record of success. This team provides advice on preparing nonimmigrant visa petitions and applications, labour certification applications, immigrant visa petitions and adjustment of status. Further, the firm handles the processing of a wide variety of temporary work and training visas for professional and technical employees, most commonly H-1B, H-1B1, L-1, E-3, TN, and H-3. The firm works with clients to obtain US permanent residence for its employees, in all preference categories, including PERM green card processing for EB-2 and EB-3 quotas, multinational managers and executives, extraordinary ability workers, outstanding researchers and persons eligible for national interest waivers.

Myers Thompson

Legal services to clients also extend beyond case preparation and processing, and include comprehensive case management – made possible via its proprietary customised forms and database systems developed and refined by the firm over the past 20 years in order to document production and maintain up-to-date information.

An immig specialisi

Some highlights for the firm include: • Shaping the passage of ImmAct ‘90, including the first H1B quota. ImmAct ‘90 continues to be the most comprehensive change to the Immigration & Nationality Act since 1952. • Preparing several (more than 60) visa petitions in one weekend for managerial transferees of a major transportation company. • Managing all aspects of immigration for many corporate clients in significant mergers, acquisitions and divestitures, including multiple consecutive acquisitions by a telecommunications products maker, and the merger of two major international food companies. ThisMyers work has included keepThompson Professional Association, 123 North 3rd Street, Suite For further information please contact hnguyen@m ing cases progressing following a succession of mergers and divestitures. • Myers Thompson is of the most successful law firms in the country using the blanket L petition process to decrease both cost and delay in transferring key international employees to the US. Its use of blanket L approvals has saved its clients months of government processing delays and thousands of dollars in government filing fees.

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Incorporating Businesses in the BVI

Incorporating Businesses in the BVI The BVI Business Companies Act (No 16 of 2004) is a statute of the British Virgin Islands relating to the formation of all companies in the British Virgin Islands, both offshore companies and local companies. It replaced the extremely popular and highly successful International Business Companies Act. The decision to replace the International Business Companies Act was driven by two things. Firstly, there was a general perception that the older legislation was becoming a bit dated, and needed modernising. Secondly, the OECD and other multinational organisations had expressed concerns about ring-fenced tax regimes in tax havens, such as that under the older legislation and were putting jurisdictions under pressure to repeal them. The British Virgin Islands Financial Services Commission dealt with both issues in a single legislative swoop. The BVI Business Companies Act is actually based upon a New Zealand statute (as opposed to the International Business Companies Act, which was based on Delaware corporation law). Conscious of how widely the earlier legislation had been copied by other tax havens, the BVI Business Companies Act was drafted with a large number of forms and procedures which specifically tied it into the Territory’s regulatory structure, thereby making it much harder to simply copy and enact. Essentially, a modern IBC is a private corporation which is exempt from tax, suitable for virtually any international business activity, has a flexible organizational structure, is not burdened by excessive reporting and record-keeping requirements, and maintains strict confidentiality provisions.

Tax exemption

A BVI Business Company is exempt from the BVI income tax, the same exemption applies to all dividends, interest, rents, royalties, compensations and other amounts paid by a company, and all capital gains realised with respect to any shares, debt obligations or other securities of the company. No estate, inheritance, succession or gift tax is payable with respect to any shares, debt obligations or other securities of a BVI BC. All transactions and instruments relating to transfers of any type of property of assets, shares, debt obligations or securities to or by a BVI BC are exempt from the stamp duty, with a sole exception for land-ownership transactions in the British Virgin Islands, in which case stamp duty remains payable.

The advantages of choosing the BVI

These are some of the general advantages of the British Virgin Islands over many other offshore financial centres:US dollar is the official currency in the BVI - therefore, by definition, there can be no currency controls and no artificial manipulation of money supply by the local government. BVI are a British Overseas Territory, which provides for an outstanding political stability. The country also maintains a low international profile and a clean reputation, thus avoiding the pitfalls experienced by some more publicised and less scrupulous offshore tax havens. BVI has an independent judicial system based on English Common Law. Laws and regulations are routinely developed in consultation with the private sector. Offshore financial

services sector contributes a very significant part to the country’s gross domestic product. Therefore, an inherent and pronounced interest exists both with the government and with the general public to maintain and develop the country’s status as a competitive offshore financial centre. BVI is an independent country with a fairly high standard of living. Therefore, it avoided entering any information-sharing agreements with foreign countries or organizations for exchange of financial aid. Client confidentiality is robustly enshrined in the BVI corporate and business legislation. BVI is easily accessible by sea and air, has modern telecommunications and is on US Eastern Standard Time (1 hour behind EST in winters).

Flexibility and confidentiality

A BVI Business Company requires a minimum of only one owner, one shareholder, and one director. All of them can be one and the same person. Apart from the director, the company need not appoint any operating officers. The management structure of the BVI Business Company may be designed in accordance with the widest variety of requirements. The shareholders, directors and officers of a BVI Business Company may be individuals or corporations and of any nationality. The shareholder’s or director’s meetings need not be held in the British Virgin Islands and there is no requirement for an Annual General Meeting. Meetings can be held by telephone or other electronic means; alternatively, directors as well as shareholders may vote by proxy. Where a Business Company has only one member who is an individual and that member is also the sole director, such sole member / director may specifically appoint a reserve director to act in his place in the event of his death. Furthermore, Confidentiality is one of the key features of the BVI Business Company as details of the company beneficial owners, directors and shareholders are NOT part of public record. Register of Members, Register of Directors and all Minutes and Resolutions by the Company are kept only at the offices of the Registered Agent in complete confidentiality. Certainly, though, these files are available for inspection to Company shareholders. The only documents held on public record are the Memorandum and Articles of Association, but these normally do not contain any indication as to the actual shareholders, directors or the beneficial owners of the company.

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Incorporating Businesses in the BVI

Folio Corporate Serv ices Limited Tel: +1 284 494 7065 | Fax: +1 284 494 8356 m | www.folioadmin. com Calum McKenzie - Director

“Our ability to provide the quality service and diversity that is demanded by our clients has been demonstrated by our year on year growth since we began operations in 2005.” - Calum McKenzie Folio Corporate Services Limited (“FCSL”) is a BVI based corporate services company. The Company provides a full suite of corporate services to BVI companies and offers services in a number of other jurisdictions. These services range from the most commonly used, such as incorporation / registered Office & Agent services, through to handling licencing applications for investment business and trust companies, providing director/corporate governance services, opening bank & brokerage accounts throughout the world and other ancilliary services such as ship registration. FCSL is a subsidiary of Folio Administrators Limited, celebrating its 10th business anniversary this year, and is part of the Folio group of companies which also provide Fund Administration and Insurance services across a wide number of jurisdictions. Calum McKenzie, FCSL Managing Director, said that given the Company’s origins as a subsidiary of a Fund Administration company, its core competence has been dealing with the registration and approval/licencing of mutual funds and related companies. He said: “We have established a reputation as a premier service provider in this area and have grown our business around mutual funds and companies related to them. We do not operate the common BVI business model being a provider of high volumes of companies for extremely low margins.

Amy Roost

Established in 1863, Jordans are a leading supplier of corporate and trust services both in the UK and other offshore locations. In addition, Jordans provide company search and information services and are the largest independent legal publisher in the United Kingdom. Jordans International Limited, part of the Jordans group of companies, headquartered in Bristol, in the UK, and in concert with its offshore offices/subsidiaries, provides corporate and trust administration, taxation and accounting services primarily on behalf of professional advisors and entrepreneurs involved in cross border transactions. “Our long heritage, independent ownership and the diversity of expertise we offer across our group are all features that set us apart,” said Amy Roost, director. “For our clients, these qualities mean we are responsive, dependable, flexible and accurate. The British Virgin Islands is one of the most popular incorporation jurisdictions in the world with over 500,000 active companies on the register. Commenting on this popularity, Ms Roost stated that “the BVI company is wellestablished and is a known quantity to banks and other financial institutions”. Its corporate legislation is modern and state of the art. The BVI also enjoys a high level of regulation and is an OECD white-listed jurisdiction meeting the international tax standard on transparency and information exchange. A BVI Business Company offers considerable flexibility on the location of its administration. Statutory records may be held anywhere in the world on the proviso that copies are held by the registered agent in the BVI. Director and shareholder details are not held on public file, although incumbency

Our focus is to provide what would be termed ‘value added services’ and provide our clients with something that adds real substance to their operations.” Indeed, as Mr McKenzie noted, the firm has an excellent record of client and company retention, much higher than the industry norm and has a much lower percentage of companies/clients who do not renew on an annual basis. “We provide services to a wide range of companies from basic business holding and trading companies through to mutual funds and listed companies. We provide director services to a diverse range of companies also, drawing upon the extensive pool of experience, knowledge and professionalism of our team of highly qualified personnel,” he said. “Our ability to provide the quality service and diversity that is demanded by our clients has been demonstrated by year on year growth since we began operations in 2005.” Mr McKenzie went on to explain that the BVI is the leading jurisdiction for the incorporation of companies. The number of companies registered is now fast approaching 1 million. “The main single reason for this is the product… the BVI company is quick and simple to obtain/register, easy to use and to understand, thanks to pragmatic, clear and simple legislation, recognized worldwide and historically proven . Service providers in the BVI are very competent and good at what we do. The jurisdiction has built its own reputation for the past 25 years and has proven it will do what is necessary to enable business to thrive within the BVI. ” he said.

Jordans (Caribbean) Limited +1 284 494 66 amy_roost@jordans 43 www.jordans-intern

certificates are commonly issued to confirm this information. An absence of public filing requirements affords an inexpensive means of preserving confidentiality, although Ms Roost believes that the benefits of such confidentiality nowadays can be overstated. A BVI BC typically takes just two days incorporate, a consequence of a modern electronic incorporation system to which licensed BVI registered agents have exclusive access. “Once we have full due diligence on our clients we are able to incorporate efficiently using the system,” explained Ms Roost. “The company number and electronic Memorandum and articles of association are received within 24 hours and the certificate of incorporation is generally received on the following business day.” Ms Roost noted that the most recent BVI legislation includes the Financing and Money Services Act (regulating Foreign Exchange and money services providers operating in the BVI) and the Securities and Investment Business Act which overhauled the mutual funds legislation, and introduced the regulation of BVI companies conducting investment activities around the world. Concluding with her predictions for the rest of the year, Ms Roost stated that volumes of BVI companies are likely to increase.

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INSOLVENCY Who’s who INSOL Europe is the European organisation of professionals who specialise in insolvency, bankruptcy and business reconstruction and recovery. There are currently 1100 individual members from 30 different countries, and each of them has a special interest in European cross-border insolvency and restructuring. Chris Laughton, president of INSOL Europe and partner at Mercer & Hole,

concerned with bank regulation. Banks are looking to

of the insolvency industry in the UK. There were fewer corporate insolvencies

have bad loans on their books.

noted that the recent recession is seen as different to previous ones by members than expected, compared to previous recessions.

“This was a financial crisis and as we all now know, it was to some extent bank

led,” explained Mr Laughton. “The banks have been very sensitive to the whole financial situation for two reasons: i) political; and ii) banks’ balance sheets.

“The political point is relatively straightforward. When banks are being

as bashed as they have been it really doesn’t go down too well for them to be making a lot of insolvency appointments.”

Mr Laughton noted that the financial point is more significant and

strengthen their balance sheets, and therefore don’t want to “Clearly if one of their customers goes into a formal

insolvency proceeding, it’s pretty difficult not to recognise that as a bad loan. If, on the other hand, they have a com-

pany that is going through some stress and couldn’t afford to pay if it was demanded, because base rates are still at

half a percent it’s not that difficult for the stressed company to keep going provided its bank isn’t pushing it too hard.

The banks aren’t pulling plugs on companies because they

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don’t want the hit on their balance sheets.”

Mr Laughton noted that in the UK insolven-

cy is seen very much from a rescue perspec-

tive, where the administrator’s primary obligation is to rescue the company in question. “It is a complete nonsense to say that

because at some stage in the past the company was related to a company with a final salary

scheme, the insolvent company therefore has

will be the only people that they can get hold of to say or do anything about it.

The third quality is being human, as the

practitioner is dealing with human beings,

some of whom have suffered. Mr Laughton

explained that the most difficult part of any insolvency practitioner’s job is laying off people “It never gets any easier. It happens from time to

time, but it’s desperately sad for them. It’s also sad

just doesn’t fit the rescue culture at all.

sight of that – insolvency involves financial loss and

“I understand there may well be legislation

brought forward to regularise that, to stop the apparent advantage the pension fund might

have as a result of the way the courts are currently interpreting the law.”

According to Mr Laughton, the key skills

required of an insolvency practitioner are to be professional, commercial and human.

“You’ve got to be thoroughly professional

because it’s a professional and legally-based

job. Constantly you have to bear in mind your responsibilities as an officer of the court. You are a fiduciary for a whole range of people,

for the creditors who’ve lost money. You can’t lose that is very difficult for people to deal with. You

have to remember that despite all of that, you’re the professional who does know how to do what he’s

doing, and you do that to the best of your abilities.”

Mr Laughton believes that solving cross-bor-

der issues is an area where there is increasing involvement by ordinary practitioners. More

and more clients, whether it’s troubled debtors or creditors who are looking for assistance, are coming from outside of a practitioner’s home jurisdiction, simply because that is the way business is done these days.

“Many businesses have some part that

usually the creditors, and it’s your job to do

involves importing or exporting, and people

You’ve got to balance conflicting interests and

looking to solve situations in financial distress,

things in the interests of all the creditors.

there are high moral standards required.”

An insolvency practitioner has to be com-

mercial because they are dealing with the

travel,” explained Mr Laughton. “When you’re once you get country borders coming into play it can get very complicated very quickly. “The golden rule is you can’t solve these

realisation and distribution of assets.

cross-border problems yourself. What you need

place you have to be able to do a deal, get the

other side of the border in question. The one thing

“In the right circumstances and the right

money out and make it available to the credi-

tors. You have to be able to deal with a whole range of commercial issues. You never know

what type of business you’re going to be faced with one day to the next.”

Mr Laughton added that an insolvency prac-

titioner must be able to deal with pressure, as

many people are going to be very angry when a business fails. The practitioner, or his team,

INSOL Europe

if there’s no work for them.

to suffer a pre-preferential claim in order to

put money back into that pension scheme – it

in association with:

is a fellow professional you can work with on the I would say to any practitioner who is looking

at cross-border situations or to anybody with a

cross-border situation where they needed help is

this: you can’t just go to one place and have all your

problems solved unless you’re talking to somebody who is sufficiently well connected that they know who to work with on the other side of the border. That’s where INSOL Europe and its network of

Chris Laughton President +44 (0) 20 7427 5507

professionals across Europe comes in.”

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Switzerland Ernst & Young Olivier Dunant Partner | Legal +41 58 286 56 71

Dr Thomas Bauer Partner | Legal +41 58 286 84 70

Ernst & Young is a leading provider of audit, tax, transaction and advisory services. The firm’s 144,000 employees around the world provide quality services by combining their common values with consistent commitment. In Switzerland, Ernst & Young is a leading audit and advisory company offering services in the area of tax and legal issues, as well as in transactions and accounting. The company has around 2,000 employees at 10 locations also in the area of tax and legal, as well as in transactions and accounting. The firm provides hand-tailored teams composed along the real needs of the clients. It mobilises on short hand the IT specialists, tax advisors, corporate lawyers and accountants, not only in Switzerland, but all over the world. In particular, Ernst & Young successfully meets the needs of large corporate structures, restructuring and insolvency cases with cross-border issues and the firm has a long and successful tradition as advisor or court-appointed administrator. Restructuring Ernst & Young’s team develops solutions principally for corporate clients that are experiencing reduced stock market valuations, underperformance in part of their entire portfolio, restricted access to capital markets or pressure to restructure. The solutions that the firm uses in such situations include: • Business deconstruction/reconstruction techniques (a cost value approach to business analysis and operational restructuring)

Germany bunk-alliance Rae. Artur Bunk, Partner +49 6241 97249 0

With a strict emphasis on high quality legal expertise, bunk-alliance Rae. is focused on bankruptcy, distressed M&A, cross-border insolvency, debt collection and associated areas. The firm and its associated consulting company consist of a small team of highly motivated professionals who give full attention to clients’ needs and demands. Artur Bunk, partner with the firm, noted: “Because we do not belong to one of the large international legal networks, we must convince our clients with a high degree of responsiveness and attention to his/her needs as well as high efficiency. Because of our limited size, a resulting flexibility and ability to provide our clients with tailor-made solutions, rather than being limited by internal procedural standards, is a competitive advantage. We do not have to convince a ‘legal opinion committee’ in order to respond quickly if the client needs a peculiar out-of-the-box solution.” In addition, because of bunk-alliance’s dedicated focus on cross-border transactions, its lawyers and consultants are confronted with non-native clients and nongerman company structures and needs on a daily basis. As regards case studies that bunk-alliance has worked on recently, Mr. Bunk explained that in one recent case, the firm acted as special counsel and agent in a

• Optimisation of working capital – receivables, payables and inventory • Portfolio value optimisation, value creation and maintenance strategies • Portfolio reorganisation including full M&A and business exit services; and financial restructuring, options, evaluation and negotiation. Insolvency Ernst & Young’s service offering aims at carrying out large-scale and complex debt moratorium and bankruptcy proceedings or to assist bankruptcy offices as auxiliary. As bankruptcy administrator, the firm’s services include, as appropriate: questioning the debtor; taking the inventory; preparing and organising the initial meeting of creditors, valuing and administering real estate and work in progress; drawing up schedules of claims; lists of encumbrances and distribution lists; tasks in realising assets; establishing and selling rescue companies and selling off parts of the business. Olivier Dunant, partner, explained that Switzerland is an exportorientated country with groups of companies and an international presence, which requires a broad expertise both in national and international corporate and insolvency law. “The most exciting challenge for the Swiss economy is the strong Swiss Franc having adverse effects and complex impacts both for Swiss companies and their partners and subsidiaries abroad,” said Mr Dunant. Dr Thomas Bauer, partner, observed that Switzerland is facing major changes in corporate and insolvency law, the purpose of which is to strengthen the legal frame for turnarounds and recovery. “We are closely accompanying the actual ‘too-big-to-fail’ legislation process and its impacts on not only the banks, but also the clients,” commented Dr. Bauer. He concluded: “The ongoing economic turbulences will make recovery services even more important for our clients than this was the case by now.”

cross-border insolvency of a German multinational concern – managing the legal aspects, communications and general advisory aspects for the multinational’s Polish subsidiary branch. He added: “Jointly with the support of the German main administrator and the Polish established branch administrator and court, we managed to ensure a smooth takeover by the purchaser of the German holding. The alternative would have been a separate asset liquidation of the Polish branch with disastrous impacts on the entire deal. In another recent case we advised on directors’ liability in the Polish branch of a German holding company acting on behalf of one of the largest German insolvency law firms.” When asked how best to describe the restructuring and insolvency environment in Germany, Mr. Bunk stated that German insolvency and restructuring law is governed mainly by the German statutes on insolvency law. However, various acts, statutes and ordinances in other related fields also have an impact on the framework, which a company under restructuring or insolvency must comply with, and which might have a significant impact on the possible course of action. He said: “A significant difference to other regimes is the very limited possibility to influence the choice of the established administrator. Due to the unpredictability of the courts’ choice, an envisaged and agreed plan for restructuring might become completely spoilt when the motion for the opening of proceedings is filed.” He concluded by noting that as present there is a huge discrepancy between the globalised environment most companies are faced with, as well as the very local way in which most insolvency offices and administrations are carried out. Because insolvency administration is typically a local business model, opportunities are being lost because sometimes the appointed administrator is lacking the experience or the network to take full advantage of the companies’ external potential.

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US – New York John J. Rapisardi Cadwalader, Wickersham & Taft LLP Partner and Co-Chairman, Financial Restructuring Department Tel: +1 212 504 5585 | Fax: +1 212 504 6666

Cadwalader’s Financial Restructuring Practice is a premier restructuring, bankruptcy, insolvency and workout group, distinguished by its broad experience, the diverse nature of its clients, its significant global expertise and its expert attorneys. The firm’s practitioners, many of whom are internationally recognised leaders in their field, bring clients the business acumen and in-depth legal knowledge necessary to successfully navigate complex restructurings and reorganisations. The department has a preeminent full-service restructuring group with dedicated experience and professionals in both the United States and the United Kingdom, allowing its attorneys to quickly respond to cross-border restructurings. Cadwalader’s restructuring and insolvency experts in the US and UK have been at the forefront of some of the most complex, recent international insolvencies, and the firm routinely advises clients with interests in North America, Europe, Asia, Latin America, and Africa. “By using a multidisciplinary approach, our clients benefit from Cadwalader’s strong experience in debtor financial restructuring and bankruptcy, corporate transactions, finance, real estate, capital markets, litigation, and tax structuring,” said John J. Rapisardi, Co-Chair of Cadwalader’s Financial Restructuring Department and a member of the firm’s Management Committee. Cadwalader’s prestigious Financial Restructuring practice is continually recognised for its preeminent and renowned work within the field. Recent accolades include US News & World Report: Cadwalader’s Financial Restructuring practice was named a National Tier One firm for bankruptcy law and the firm was described as having “exceptional restructuring attorneys with the highest integrity.” Law360, a Portfolio Media, Inc. newswire: Cadwalader’s Financial Restructuring practice was honoured as a Bankruptcy Group of the Year by Law360. The Bankruptcy Group of the Year accolade is conferred upon the top five law firms “that did the hard work behind the headlines in 2010’s big-dollar bankruptcies, whether it was for debtors or their creditors.” The firm was praised for its exceptional work on the LyondellBasell chapter 11 bankruptcy as well as for the team’s ability to obtain consistent results on behalf of all clients in many notable bankruptcies and restructurings in 2010. Law360 noted that the judge overseeing the LyondellBasell restructuring called the deal that ended the case “one of the most complex settlements” he had ever seen. Financial Times Innovative Lawyers Report: Cadwalader was one of only three firms ranked as “standout” for exceptional work in 2010 in the automotive sector for advising the U.S. Treasury Department Presidential Auto Task Force in the historic restructuring of General Motors and Chrysler and in the restructuring category for its work on the chapter 11 of petrochemical giant LyondellBasell. Investment Dealers’ Digest: Cadwalader won recognition in for its work as debtor’s counsel to LyondellBasell in its chapter 11 case, which was named 2010 Restructuring Deal of the Year. IDD noted that the workout involved “many unique twists.” The awards celebrate dealmakers that created the most value for their corporate clients and for their investors. Commenting on the restructuring and insolvency environment in the US, Mr Rapisardi explained that during the first half of 2011, distressed companies generally attempted to take advantage of available financing to extend near-term maturities rather than pursuing bankruptcy alternatives. Additionally, a significant percentage

of the bankruptcy cases that were filed were either prepackaged or prenegotiated filings, where prepetition agreements with existing creditors expedited the bankruptcy process, or were filed to take advantage of section 363 of the Bankruptcy Code, which allows a debtor to sell assets outside the ordinary course of its business. “More recently, we have seen an increase in defaults under credit documents that will require the companies involved to either obtain amendments or forbearance agreements from their lenders or seek bankruptcy protection,” said Mr Rapisardi. “We foresee lenders becoming more inclined to pursue available remedies rather than continuing to forbear in the near future.” Mr Rapisardi noted that one of the biggest challenges facing distressed companies and their lenders is maximising leverage in restructuring negotiations. The firm regularly advises its clients that such leverage stems from a thorough understanding of the details of all applicable credit documents, market forces, and the advantages potentially available under the Bankruptcy Code and other applicable laws. “To that end, Cadwalader brings subject matter expertise to restructurings in a great number of industries, including financial services, retail, health care, manufacturing, shipping, insurance, printing and gaming,” said Mr Rapisardi. Additionally, Cadwalader recently supplemented its existing practice groups by launching a best-in-class Energy & Commodities practice in January 2011. Over the course of 2011, Cadwalader’s Financial Restructuring and Energy & Commodities attorneys have worked closely on several matters, offering clients both traditional restructuring counsel and an in-depth understanding of how market and regulatory forces will impact restructuring negotiations. “While no longer on the horizon, many large financial institutions are attempting to understand the steps that will be required to comply with the so-called ‘living-will’ provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act,” explained Mr Rapisardi. Section 165(d) of Dodd-Frank requires “systemically significant” financial institutions to periodically report to the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Company and the Financial Stability Oversight Counsel a plan for the rapid and orderly resolution of their business in the event of material financial distress. Additionally, the FDIC and the Federal Reserve recently proposed joint rules governing the implementation of these “living will” provisions. “We expect large financial institutions to devote immense resources to the process of preparing living wills over the next year and in updates quarterly and annually and have therefore dedicated significant attention to understanding this new reporting requirement,” concluded Mr Rapisardi.

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Mexico Cervantes Sainz, S.C. Alejandro Sainz, Co-Managing Partner +(52)(55)9178.5046

Cervantes Sainz, S.C. is a full service law firm actively engaged in a dynamic and complex domestic and international practice. The firm is composed of prestigious lawyers accumulating a high level of experience, who ventured to form and achieve an innovative style of organisation. The firm maintains an active and diversified insolvency and restructuring practice, and has worked with respected international law firms in various types of crossborder transactions. Crucially, the firm provides prompt and responsive representation including advising clients, domestic and foreigners, in both the financial and procedural aspects of insolvency and bankruptcy matters. The firm is also well-known for successfully representing bondholders – ad-hoc committees – while at the same time its lawyers are admitted to practise in local and federal courts throughout Mexico. Alejandro Sainz, co-managing partner with the firm, noted: “Cervantes Sainz has proven efficiency in a wide range of complex and critical cross-border restructuring and insolvency matters involving issues of unsecured creditors, secured creditors, derivatives and domestic and foreign claims. Its litigation practice has the intellectual depth and creativity to resolve virtually any type of legal dispute arising in Mexico.” Mr. Sainz also acts as chairman of the Insolvency & Restructurings Practice Group and Co-Chair of the Mergers & Acquisitions Practice Group of Cervantes Sainz. Through these

Poland BEITEN BURKHARDT law firm Peter Daszkowski Managing Partner

Paweł Kuglarz Attorney at Law - Partner

BEITEN BURKHARDT P. Daszkowski Sp.k. is one of the leading law firms and has been on the Polish market since 1995. About 35 lawyers and tax advisors provide services and realise projects and transactions in English, German and French. We render legal advice to mid-sized companies, large corporations and corporate groups on every aspect of their business. In particular, we offer legal services on prevention of restructuring and insolvency, but also when it comes to a financial crisis or insolvency of the company. Our Clients can rely on our necessary legal expertise and our in-depth understanding of the economic background. This unique combination enables us to develop and execute effective solutions at short notice. We assist our Clients: • in dealing with counterparties at risk of insolvency • with corporate and revenue law aspects in restructuring • in avoiding liability in times of crisis • with insolvency proceedings, and • with restructuring and its impact on balance sheets We also specialise in international insolvency proceedings within and outside the European Union. In cooperation with BEITEN BURKHARDT’s offices in Russia and Ukraine as well as our close partners in the Czech Republic, Slovakia, the Baltic states, Hungary

two groups he represents national and multinational clients in a broad range of transactional matters, providing legal advice in the areas of corporate, finance and commercial law, including reorganisations, restructurings and work-outs as well as bankruptcy and cross-border insolvency procedures, among other areas. He was selected by Latin Lawyer as one of Mexico’s top lawyers, and by The International Who’s Who of Insolvency & Restructuring Lawyers 2009 as one of the world’s pre-eminent Insolvency & Restructuring lawyers. In the restructuring and insolvency arena, Mr. Sainz has represented: the ad-hoc committee of foreign secured creditors in the US$800 million cross-border restructuring of the debt of Satmex, as well as Grupo lusacell in its US$650 million cross-border restructuring of its debt, among other noteworthy succesful transactions. Meanwhile, the recession caused financial problems for many Mexican companies, particularly those that contracted loans and placed debt in foreign currency, which placed them in financial distress ending in restructuring or insolvency situations. “Thus,” said Mr. Sainz, “these cases have been more complex than in the past, since many of such distressed companies are facing claims from foreign creditors such as banks, derivative counterparties, and/or domestic and foreign bondholders, and even foreign equity holders. This situation always represents a challenge since the company and its constituencies need to evaluate the filing of a foreign insolvency procedure – e.g. Chapter 11 or Chapter 15 – vs. the filing of a Mexican concurso procedure.” He concluded: “In the coming months, the first critical issue to evaluate when assessing a distressed business will be the type of creditors of the company. The nature of such creditors – secured vs. unsecured, bondholders, banks or and/or derivatives – and the place of issuance of the debt – foreign or domestic – will result in the company taking a different approach when dealing with such creditors.”

and Austria we can offer professional assistance with respect to international insolvency proceedings. With our broad experience in international taxation we also offer tax optimisations in any critical situation. We offer comprehensive solutions combining corporate, revenue, accounting and tax law aspects. With this strategy we can achieve the best results for your benefit. Our restructuring team is well-versed in all upcoming questions regarding insolvency and recovery, coordinating all legal areas involved. If necessary, we can utilise our established resources from a network of auditors, tax advisors and business consultants. The Polish bankruptcy law is modern and well developed. There are two types of bankruptcy proceedings: (i) reorganisation and (ii) insolvency. Whereas the reorganisation is aimed at entrepreneurs facing a financial crisis and threatened with insolvency, the insolvency proceedings are initiated for entrepreneurs who are already insolvent. The latter one – depending on the content of the petition – can be led with a view to liquidate the debtor’s estate or to conclude an arrangement with its creditors. Recent figures have shown that reorganisation counts for only a few percent of overall bankruptcy proceedings. A separate section of the bankruptcy law deals with consumer bankruptcy. A petition for bankruptcy may be filed only by the debtor and a bankruptcy might be declared if the insolvency was a consequence of exceptional circumstances over which the debtor had no influence. The possibility for announcing bankruptcy is restricted in case where within ten years prior to the submission of a bankruptcy petition bankruptcy proceedings had been instigated against the debtor. Major amendments to the Polish law on mortgages, which were enacted earlier this year, are expected to significantly influence Polish bankruptcy proceedings. As there are no precedents concerning the new law yet, the forthcoming months are deemed challenging.

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Global Complex Issues. Resolved.

Carribbean KRyS Global Andrea Harris-Kellow Senior Analyst +1 345 947 4700

KRyS Global is a professional services firm committed to resolving complex cross-border issues in the areas of corporate recovery, insolvency, forensic accounting and business advisory services. KRyS Global has over 40 professionals who work from offices in four jurisdictions: the Cayman Islands; British Virgin Islands; Bahamas; and Bermuda. Each office has a team of independent, dedicated and experienced professionals with practical expertise, global experience and the ability to provide objective, sound advice. Through vigilance, dedication and thoroughness, we are committed to delivering results and achieving exceptional value for our clients. Unlike a number of other firms, KRyS Global only provides insolvency, liquidation, corporate recovery, forensic accounting and related services, which enables the firm to provide independent, focused and experienced service to its clients. KRyS Global’s staff are experienced and qualified in the field of insolvency and forensics, and the firm ensures all engagements are carried out by closely managed teams led by a dedicated director. Clients benefit from these close-knit teams of professional accountants, certified fraud examiners, insolvency professionals and certified anti-money laundering specialists. Our practical hands-on approach, along with the depth and range of

Kosovo Lawfirm IOT


Mr. Virtyt Ibrahimaga, Partner +381 (0) 38 227 358

Lawfirm IOT (Ibrahimaga/Osmani/Tigani) is a full service law firm dedicated to professional excellence, and is home to attorneys held in high esteem throughout Kosovo and the surrounding region. Each partner and attorney at the firm is highly reputable and is a leading expert in his or her respective area of specialisation, within disciplines such as corporate, mergers and acquisitions, real estate, tax law, civil law, labour law, administrative law, litigation and arbitration, liquidation and restructuring, including EU and competition law. Mr. Virtyt Ibrahimaga, partner with Lawfirm IOT, noted: “Our firm is one of the pioneers in providing advice on liquidation and restructuring in Kosovo. We have initiated the first procedures of liquidation of companies in Kosovo.” Mr. Ibrahimaga is renowned among industry insiders as being the leading expert in liquidation and reorganisation in Kosovo. He is currently acting as adviser of the Kosovo Privatisation Agency of Kosovo in liquidation of the State Owned Companies. He was also engaged as an adviser of the World Bank on the preparation of the assessment of the liquidation and reorganisation system in Kosovo. He is also a full member of INSOL Europe and the Association of Insolvency and Restructuring Advisors.”

experience of our professionals, ensures our clients receive answers and remedies specifically suited to meet their needs and demands. KRyS Global is involved in some of the largest, most complex and unique international and cross-border assignments in the Caribbean, and obtains work from lawyers, regulators, fund managers, administrators and insolvency and professional firms in other jurisdictions. The firm’s larger engagements include SPhinX Group, Fairfield Sentry and Sextant Funds. All of these engagements involve elements of fraud, cross-border litigation and highly complex issues requiring specialised strategies to recover assets for the benefit of creditors. The Cayman Islands insolvency law is based on the UK Insolvency Act of 1986 with some modification to make it relevant to the local financial services sector. The majority of work undertaken in the Cayman Islands comprises court-supervised liquidations and forensic accounting engagements. Due to the nature of the financial services sector, it is rare for the liquidator to find the books and records, assets or operations to be located within the jurisdiction of appointment. Offshore liquidators avail themselves of their forensic skills and toolkits to trace assets, and are experienced at cross-border litigation in seeking recoveries for creditors. The landscape of international cross-border insolvency is changing, requiring the professionals to be flexible and able to respond quickly to the hurdles presented in cross-border assignments, whether it’s collecting books and records, tracing assets, transparency or recognition issues. Our firm develops strategies tailored to maximising the recoveries to the estate while weighing and balancing the risks.

According to Mr. Ibrahimaga, the restructuring and insolvency of private companies in Kosovo is a novelty, while the liquidation of socially-owned companies is more developed. The legal framework has not yet been complete; not many private companies have initiated liquidation procedures, and only a few privatelyowned companies have initiated restructuring procedures. When asked about some key challenges and complexities that can be encountered when working within the field of restructuring and insolvency in Kosovo, Mr. Ibrahimaga provided comment: “The challenge is a lack of expertise of professionals for handling liquidation and restructuring,” he explained. “Our firm has contributed thorough assessments and advisory services to the state authorities via initiation of procedures for the development of this field in Kosovo.” As regards new and pending pieces of legislation that may affect the industry, he concluded: “There is a new law on liquidation of socially-owned enterprises in preparation. The amendment of the current law on liquidation of privately-owned corporations has also been initiated. The reform of the legal framework is aimed towards the enhancement of the capacities and efficient procedures for liquation and restructuring in Kosovo. “Further, with the new draft law, socially-owned enterprises will no longer be liquidated by civil servants of the state, but by the private practitioners. The procedures for the liquation will be simplified in order to ensure the effective liquidation of enterprises. For the near future, we expect the completion of the legal framework for liquidation and restructuring in Kosovo.”

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Israel SHAPIRA & Co. Ofer Shapira Managing Partner +972 3 7766999

SHAPIRA & Co. is a boutique law firm specialising in insolvency & reorganisation, property law and litigation. SHAPIRA & Co. provides service in all matters related to the handling of distressed businesses, scheme of arrangements, collection of debts and realisation of assets in Israel and abroad. The firm also provides high-end services in complicated property transactions and construction projects, as well as in commercial litigation. The services of SHAPIRA & Co. also include representation in complex and diverse litigation, management and realisation of assets and businesses and initiation and execution of legal arrangements to maximise the value of each project’s objectives. The extensive experience of SHAPIRA & CO. in dealing with complex crises regarding distressed companies includes management of insolvent companies as going concerns, representation of major creditors, initiation and management of scheme of arrangements, realisation of assets and litigation. The firm’s team of professionals is accustomed to spearheading complex projects, defining assignments and timetables and managing co-experts in the areas of each project, including accountants, appraisers and others, towards the specific goal. SHAPIRA & Co. has been involved in many of Israel’s most significant insolvency cases. SHAPIRA & Co. is a member of Begbies Global Network, the premier global network of professionals working with struggling and declining businesses and comprised of leading lawyers, accountants, forensic investigators, profit improvement consultants and turn-

Spain Pintó Ruiz & del Valle, S.L. Carlos Noguera, Associate +93 241 30 20

Pintó Ruiz & Del Valle is one of the founders of Pannone Law Group EEIG, a group of international law firms with members in most of the EU countries, and associated members in several countries all over the world. In addition, Pintó Ruiz & Del Valle is member of INBLF, with presence in the US markets. The firm holds the deputy chairmanship at the Commission of Bankruptcy Laws of the Barcelona Bar Association. The firm is also home to professors at the School of Law Practice of the Barcelona Bar Assocation, who are in charge of the training of bankruptcy administrators for the Barcelona judicial district. These professors have acted as speakers at several conferences and seminars where professionals in this legal area, and magistrates of the mercantile courts, have also intervened. Further, the Restructuring and Bankruptcy department at Pintó Ruiz & Del Valle offers legal advice to companies and groups of companies. In the restructuring field, the firm excels rather in reaching restructuring agreements at the private field and, especially, in the property sector – rather than in intervening in judicial takeovers itself. Carlos Noguera is one of the lawyers on active service within the firm. Mr. Noguera

around and restructuring managers all over the world. This network of professionals allows SHAPIRA & Co. to provide services in connection to businesses with affiliates anywhere in the world. Commenting on the environment for restructuring and insolvency in Israel, Ofer Shapira, partner, said: “Much like the competing approaches that dominates the Anglo-American insolvency thinking, the Israeli judicial atmosphere within the restructuring & insolvency field can be described as being governed by two major approaches: the economic and proprietorial approach and the social approach. “The economic and proprietorial approach is known in its adherence to economic efficiency and proprietary values, while the social approach is much like to take into consideration elements like distributive justice and other social considerations. The Israeli judicial restructuring & insolvency environment is therefore an outcome of the tension between these two opponent approaches.” On May 17th 2011 the Israeli government published the bill of the 17th amendment to the Israeli Corporate Law. This amendment focuses on corporate reconstruction, and its purpose is to furnish additional tools and solutions in the corporate reconstruction field. Concluding with his predictions for the rest of 2011 and 2012, Mr Shapira explained that, due to the global and local recessions, he expects that a growing number of companies will experience difficulties in capital raising and in obtaining credit. “Therefore, we anticipate two major outcomes in this context: one of which is that some of these companies will have to achieve scheme of arrangements with their debtors or go into bankruptcy,” he said. “The other outcome is that some of the companies that have already reorganised their debt not so long ago will have to restructure it again, due to a recurrent insolvency.”

offers 40 years’ experience in the Bankruptcy domain. Although the firm’s Restructuring Department headquarters are in Barcelona, its sphere of action also includes Madrid, Málaga-Costa del Sol, PalmaBalearics Islands or Valencia-East/Mediterranean Coast, apart from the Courts of Tarragona, Girona and Lleida in Catalonia. Of the firm’s recent activity, Mr. Noguera noted: “During the current financial year 2011, the main case that we are taking charge of is the voluntary bankruptcy of ESTABLIMENTS MIRÓ, S. L., which has been the one with the most relevant liabilities in Barcelona. We are also taking part in many others with less significance but with a similar complexity. “Meanwhile, the Current Insolvency Act 22/2003, which became effective on July 9th, has been seen as a step forward in the creation of the Commercial Courts focused specially on restructuring and insolvency, and which takes under its jurisdiction – on a sole and exclusive basis – practically all subjects related to restructuring and insolvency.” He concluded by noting that in Spain, the Restructuring environment has been deeply changed, and all of these changes are summarised in one law, 22/2003, which came into force on September 1st 2004. He said: “The mentioned law was reformed on March 2009 and, at the moment, there is another reform in development which will come into effect before the end of the year. “All of these factors have caused a legislative upheaval; however, it is justified because of the global financial crisis on the whole and, in particular, because of the southern countries of Europe.”

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Latvia RASA & EŠENVALDS Janis Ešenvalds Partner +371 67280685

Law office RASA & ESENVALDS is a relatively new office, which joins together two young and capable sworn attorneys: Jānis Ešenvalds (LLM) and Armands Rasa (LLM, MBA). Both partners have significant eight year long previous work experience in other famous law firms. Both partners are certified insolvency practitioners since 2007. Mr Ešenvalds has experience as a liquidator’s assistant since 2003. Within those years, the partners have finished more than 100 cases, not only through bankruptcy but also through legal protection proceedings and recovery. The partners are experienced and aware on theoretical and practical law issues, but at the same time quite young and passionate on any case study and performance. RASA & ESENVALDS provides legal services in such sectors as corporate law; restructuring, M&A, legal due diligence, labour law; real estate & construction; investment protection; EU law; international trade and transport; litigation; maritime law; and intellectual property law. The firm’s experience includes cases such as belt factory legal protection proceedings; metal factory legal protection proceedings; fish factory recovery; recovery of a road building company, restructuring of motion pictures studio and many other

bankruptcy cases in a wide variety of areas. A new insolvency law came into force in Republic of Latvia on 1st November 2010. Mr Ešenvalds explained that the law includes two solutions for insolvent companies (bankruptcy and legal protection proceedings). “As always the new regulation brings a lot of complexities, the same situation is right now with insolvency law enforcement in Latvia,” explained Mr Ešenvalds. “Despite of that the partners always will find the best and the right solution for every situation, because of remarkable and irreplaceable experience and will power.” The success story of law office Rasa&Ešenvalds relies on individual approach to each of their clients and careful preliminary analysis of the situation before the work starts. The individual approach means that for the firm’s office the client and the client´s wishes are the key priority. Unlike major law offices, Rasa&Ešenvalds does not grade its clients by size or other features; every client is welcome and may be sure to receive a perfect attendance. Situation analysis is an important factor in providing the best service. As we know from our partners´ experience, even a small detail, such as an incorrect wording of a claim statement, may be crucial. Therefore, before starting legal procedures, we have to carefully evaluate the circumstances of the case and analyze similar cases. Doing our work perfectly already for the first time is the only way how we can approve oueselves. Therefore, we never stop at our achievements, but keep on working with a double effort.

level of sophistication and complexity of the numerous bankruptcy cases. In general, these developments have been positive with the courts and local practitioners inclined to take a “business” approach on matters. “That said, there are still practical difficulties caused by differing interpretations of the legal provisions by the various interestDana Radulescu - Partner Charles Vernon - Managing Partner ed groups (lawyers, creditors, syndic judges, administrators and +40-(0)21-311-5654 +40-(0)21-311-5654 so on),” said Ms Radulescu. “In addition, there is still a tendency for the courts to avoid making some of the tough decisions or to permit more drastic (but needed) actions or solutions.” Like many countries in the region, Romania has seen a significant rise in insolvency cases over the last few years. 2008 and 2009 saw the Vernon | David is a full service law firm that has been active on the Romanian market largest increase in cases, while in 2009 and 2010 the situation stabilised. since 2001. The firm’s insolvency practice focuses on advising and assisting creditors, “However, with the growing financial uncertainty in markets particularly large financial institutions, during both the pre-insolvency phase and insolvency proceedings. From negotiating the restructuring of debts to standstill agreements over the last six months, we believe there is likely to be an increase in cases over the next year,” added Ms Radulescu. to drafting restructuring plans, Vernon | David provides a variety of services to its cliRomania has recently introduced a revised and significantly ents. The firm also has a significant litigation practice and represents clients through the modified Civil Code. Ms Radulescu explained that many cominsolvency proceedings and hearing. Vernon | David’s primary goal is to protect credimentators are labelling the new changes as “radical” and many tors’ interests while maximising returns and collections during the insolvency process. legal practitioners are concerned as to the practical effects these modifications will have on various laws. Vernon | David’s insolvency department is led by partner Dana Radulescu. In “For instance, although there is no formal proposal to modify the addition to her legal training, Ms Radulescu is a licensed insolvency practitioner and insolvency law, the amendments brought by the Civil Code raise member of the Romanian Insolvency and Bankruptcy Practitioners Association. She various issues that may impact negatively on the position of crediis also a founding member of the Romanian Turnaround Management Association. tors (particularly secured creditors) both in the pre-insolvency and Currently, the firm is involved in several major restructuring and insolvency cases in the insolvency phases,” said Ms Radulescu. She concluded: “For including advising on the reorganisation and sale of distressed assets in relation to a example, the Civil Code revises important provisions such as how major manufacturer of oilfield equipment. Ms Radulescu explained that tremendous progress has been made in respect of the real estate securities are treated (including mortgages and privileges), modifies the rules on pledges including their enforcement and makes insolvency rules and practices in Romania over the last few years, due mostly to the changes to how commercial contracts should be interpreted.”

Romania Vernon | David

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Italy STUDIO PALMERI Commercialisti Associati Giorgio Palmeri, Country Managing Partner +39 051 220555

Founded in 1967, Studio Palmeri primarily works with small, medium and large companies in the trade, manufacturing and service industries. These companies benefit from assistance with the start-up phase, qualitative and quantitative development, business support, rationalisation and restructuring/insolvency, management of any redevelopment and restructuring projects, as well as assistance during the final closing phases of a business. Mr. Palmeri, managing partner, noted: “Our professional structure facilitates the processes of growth, aggregation and safeguarding of Italian business – assisting companies in major strategic decisions relating to restructuring, closure, relocation or rationalisation of production entities. The firm also identifies critical issues, suggests solutions – even beyond the enterprise itself – and takes care of relations with shareholders, management, financial counterparties, suppliers and trade unions.” From time to time, partnerships are set up with audit and accounting firms, nonprofit institutions, international chapters, merchant banks and trade association service providers when transactions have a global angle as regards corporate, tax or legal issues. However, the main focus of Studio Palmeri is on small- to medium-sized companies as per the vision of Tiberio Frascari (, co-founder of Studio Palmeri and managing partner of Imola, Bologna, which represents more than the 90% of firms in Italy. As Mr. Palmeri explained, this business segment is characterised by a strong propensity for product and process innovations, as well as an innate vocation for international markets. A high degree of specialisation Mr. Palmeri added: “There is a wide market segment of small- to medium-sized companies in crisis, often not adequately serviced by qualified professional structures, in which Studio Palmeri can operate with its own offices in Bologna and Rome and its established professional links in Milan.” “From a methodology point of view, an initial analysis is performed to identify the pathology of an enterprise,” he said, “in order to understand whether any discrepancies are reversible and if they require outside intervention.” Meanwhile, Italian companies are characterised by small-to-medium dimensions, with low equity levels and excessive propensity to indebtedness with the credit system and financial institutions. Fabio Ceroni (, managing partner of the firm’s Rome Office and board member of TMA, Turnaround Management Association, Italy, said: “It is also very common to find that companies are still run by entrepreneurs of ‘first generation’, strongly orientated to innovation and exports, often accompanied only by direct descendants and with little ability to increase the skills of governance through the inclusion of external managers. It is sometimes important to bring in external managers in order to facilitate growth processes by: mergers and combinations with other entities, and establishment in emerging and/or growth markets.”

The effects of the downturn The recent global crisis and the recession in the ‘mature’ economies, including Italy, has caused a general decline in revenues and profits of small- to medium-sized enterprises. Very often there is the problem of going concern, particularly in cases where the entrepreneur has orders and ‘horizons’ in the short term only, and does not intend to risk its own funds by injecting equity in the company. Mr. Ceroni said: “Other problems may include the dependence of our country on the commodity markets and the difficulties of governments – increasingly committed to contain public debt – to take structural measures of growth, business support, productivity, domestic demand and employment. “This results in a natural selection and contraction of the number of firms. Many are anxiously facing liquidity crises, now unable to support their debt and no longer able to invest in research and development – which has always been the real factor in the success of Italian SMEs in the past.” Safeguarding Italian business Mr. Ceroni added that a separate consideration should be made for global companies that hold an investment in Italy (productive plant or trade extension), which have always been attracted by the potential and the wealth of the domestic market. Studio Palmeri’s structure is increasingly requested by international customers for consulting about processes of disposal, withdrawal or downsizing of Italian investments in light of political uncertainty and a high burden of state bureaucracy, in addition to a historical dependence on raw materials and a lack of infrastructure to support businesses. The firm makes it possible to deliver the objective of safeguarding Italian business. In this regard, Studio Palmeri has relations with the system of Italian/Foreign Chambers of Commerce. For example, Studio Palmeri, together with the Italian-Brazilian Chamber of Commerce in Milan, has aided in relocation projects in Brazil of Italian companies no longer located in the internal markets, but which have kept in Italy their management structure, accounting and finance, research and development, and marketing, divisions.

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Canada Thornton Grout Finnigan LLP D.J. Miller +1 (416) 304-0559

Grant B. Moffat +1 (416) 304-0599

Leanne M. Williams +1 (416) 304-0060

D.J. Miller, Grant Moffat and Leanne Williams are partners in the firm’s restructuring and insolvency practice. If TGF might be the right fit for the legal issues facing you or your client, we would be pleased to hear from you.

clude editors and contributing editors of professional publica-

Thornton Grout Finnigan LLP (“TGF”) is a Canadian boutique law firm with an

This results in many insolvency proceedings extending beyond

in two areas: (i) insolvency and restructuring, and (ii) litigation.

ties to work closely with colleagues in other jurisdictions.

efficient vehicle to deliver legal services to sophisticated clients. We do not

in Canada (the Companies’ Creditors Arrangement Act and the

resources required to deliver the highest level of service to our clients without

gal issues arising, requiring particular expertise and experience

to the size of the firm and the manner in which we practice, we do not “over-

practice area. Apart from speaking and writing for a public

excellence for the provision of legal services in our areas of practice, specifically

seminars for clients on current trends or issues in the industry

office located in the financial district of Toronto, Ontario, practicing exclusively TGF was created for the express purpose of creating a more focused and

tions and a leading text book used by practitioners, as well as

instructors at the Faculties of Law at three Ontario law schools. Members of TGF are regular authors and presenters of various papers and lectures on current topics and issues affecting the firm’s clients and the profession generally.

The insolvency and restructuring landscape in Canada is dy-

namic, and well-established. Our country’s legal framework and

judicial decisions are recognized as being responsive, flexible and practical. Due to Canada’s reliance on its key trading partners, its economic landscape and many restructuring mandates are

affected by the legal and economic situation of other countries.

Canada’s national borders, which provides TGF with opportuniRecent amendments to the two primary insolvency statutes

try to be all things to all people. As a boutique firm, TGF has all the tools and

Bankruptcy and Insolvency Act) have resulted in many novel le-

the overhead costs and infrastructure necessary to support a large firm. Due

to successfully navigate this complex and highly specialized

lawyer” files. The stated policy of TGF is: “To raise the bar for the standard of

audience, lawyers at TGF also regularly provide internal

for sophisticated consumers of these legal services.” This policy is ingrained

which are designed specifically for the needs of that client.

As a boutique firm practicing exclusively in the areas of restructuring and

in the restructuring of Abitibi-Bowater (as counsel to the court-

into every lawyer at TGF.

Over the past year, lawyers at TGF have played a leading role

litigation, TGF has no restrictions on its ability to use the best practitioners

appointed Monitor), Fraser Papers (as counsel to the company),

(regardless of that practitioner’s firm affiliation), which is not the case in large

Allen-Vanguard (as counsel for the agent of the lending syndicate)

we feel are the most experienced and appropriate to use on any specific aspect

currently representing the Insolvency Institute of Canada in seeking

mal relationships with tax, corporate, real estate, pension/employment and

Canada on a pension priority matter that has significant potential

available for a particular discreet issue outside our area of specialized expertise

Blockbuster Canada (as counsel to the court-appointed Receiver),

firms. This flexibility allows us to retain similar specialists in other fields who

and Nortel (as counsel for the largest supplier). The firm is also

of a file, subject always to the client’s prior approval. We have ongoing infor-

intervener status on a requested appeal to the Supreme Court of

securities lawyers within Ontario, across Canada and in a number of jurisdic-

ramifications for the practice of insolvency in Canada.

find these arrangements to be a cost effective and seamless means of ensuring

busy in the insolvency field. The scarcity of capital and reluctance

of firm affiliations faced by “full-service” or national law firms.

the global financial crisis in 2008 have gradually been relaxed and

proceeding in Ontario over the last twenty (20) years and the partners in the

with previous economic cycles, we expect that this less stringent

ers in their practice area. The recognition of TGF as a specialty boutique firm

subsequent restructurings.

firm are regularly invited to play an active or leading role. Lawyers at TGF in-

goal is to hear colleagues and clients say: “Who’s got TGF?!”

tions worldwide whom we use on a regular and reciprocal basis. Our clients

We expect the balance of 2011 into 2012 to become increasingly

the appropriate level of specialized expertise on a file, in the absence of issues

to lend that defined much of the Canadian marketplace following

Lawyers at TGF have been involved in virtually every major insolvency

lending is again, in some cases, approaching “covenant light”. As

firm are recognized by their peers and members of the judiciary as being leadis reflected in the degree of professional involvement in which members of the

approach to lending will result in higher numbers of defaults and When a new restructuring is commenced in Canada, our

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France Vatier & Associes Ludovic Gayral, Partner +33 (0) 1 53 43 15 55

Vatier & Associes is a French law firm comprised of 30 lawyers, managed by Bernard Vatier, who has been President of the Paris Bar (1996-1997) and President of the European Bar (2004-2005). The firm is notable for offering a broad range of legal services to French and international businesses, property companies, institutions, managers and the self-employed as well as private clients. In addition, Vatier & Associes is currently in the process of: expansion, through the addition of lawyers chosen for their experience, and acquisition of firms

with strategic expertise – in order to build a multidisciplinary firm resolutely open to international affairs.

The firm has opened an office in Brussels in order to best handle European

issues, and maintains an extensive international network of correspondents se-

lected for their competence. This makes it possible to construct high level transnational teams with a capacity to respond to client needs in a timely manner. Vatier & Associes’ Restructuring & Insolvency department is managed by

Bernard Vatier and Ludovic Gayral, who maintain a recognised experience in restructuring & insolvency matters.

According to Mr. Gayral, partner, Vatier & Associes acts mainly for companies

facing difficulties. These include managers, creditors and shareholders of insolvent companies, as well as bankruptcy trustees and liquidators.

Specifically, the firm provides businesses in financial difficulty with services

including preventive proceedings, bankruptcy proceedings, preparation of

is very seldom used. Otherwise, we do not expect major legal changes for the rest of the year or 2012.” Partner profiles

Bernard Vatier began his career drafting legal documents in a firm of legal counsellors specialised in corporate/commercial transactions, where he was instrumental in the creation of a litigation department once the firm was admitted to the litigation bar. He first developed his expertise in business law, in

corporate and commercial transactions as well as litigation,

later adding white collar criminal law, a matter he taught at ESSEC from 1974 to 1988.

His expertise in insolvency law has led him to handle sig-

nificant cases of corporate restructuring, in which he offers his clients a true mastery of business law. Bernard Vatier also acts in arbitration.

Elected member of the Conseil de l’Ordre of the Paris Bar

restructuring plans, relations with bankruptcy trustees, acquisition of bankrupt

in 1988, then President of that Bar (1996-1997), Bernard Vati-

managers, auctions and arrangements with creditors.

the core values of the legal profession in his capacity as head

businesses, civil liability of managers and third parties, criminal liability of When asked about some key challenges and complexities that pertain to

insolvency law, Mr. Gayral noted that French insolvency law has been modified several times since 2005.

He elaborated: “More and more tools are offered to companies facing difficul-

ties, and the French legislator is encouraging agreements with creditors and

shareholders under the supervision of the presidents of the commercial courts – in order to avoid the opening of insolvency proceedings.

er has continuously been actively engaged in the defence of of the French delegation to the European Bar from 1998 to 2002, then President of that Bar until December 31, 2005.

Bernard Vatier is a Fellow of the American Bar Founda-

tion, Honorary member of the Gray’s Inn and Honorary member of the Australian Bar.

He is President of the Union Nationale des Caisses d’avocats. Ludovic Gayral joined the commercial law practice at

“Vatier & Associes has a high knowledge of all these tools and of the actors of

Vatier & Associés in 2001, after three years at Stibbe Simont,

As regards new and pending changes to regulation, on October 22, 2010, the French

mercial litigation, including in particular contracts, business

the insolvency & restructuring market.”

legislator created a new type of proceedings, which is the financial accelerated safe-

guard. The financial accelerated safeguard can lead to the approval of a safeguard plan only one month after the insolvency judgement. Such a plan requests efforts from the financial creditors only, even if they do not all agree with it.

“For the moment,” said Mr. Gayral, “the financial accelerated safeguard

Monahan, Duhot & Giroux. His experience has been in comaffairs, bankruptcy and insurance.

He was also a teacher at the Institut d’Etudes Politiques

(Sciences Po) in the Master of Economic Law program where he introduced American students to the fundamentals of the French legal system from 2006 to 2009.

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Association Management

Association Management Companies There are more than 25,000 national associations and 65,000 local, state or regional associations in the US. These organisations employ more than 500,000 professionals engaged in the practise of association management. Association management is a distinct field of management because of the unique environment of associations – which are unique in that their owners are dues-paying members. Members also govern their associations through elected boards or other governing bodies, along with association committees, commissions, task forces, councils and other units. Typically, the board selects, retains and evaluates a chief executive officer or executive director who is then responsible for the day-to-day management of the association and paid staff. In addition, managers within an association environment are responsible for many of the same tasks that are found in other organisational contexts. These include human resource management, meeting management, financial management, IT management and project management. Other aspects of management are unique for association managers. These include membership recruitment and retention, tax-exempt accounting and financial management, as well as development of non-dues revenue and fundraising. Association managers should also be familiar with legislation pertaining only to associations. In order to obtain the knowledge required to operate in association management, its practitioners may choose to pursue the Certified Association Executive designation – a qualification which may be obtained via the American Society of Association Executives ( Notably, national societies of association managers exist all around the world. Europe, for instance, is home to the European Society of Association Executives ( AMCs An association management company (AMC) provides management and specialised administrative services to trade associations and professional societies using a for-profit approach that runs not-for-profit associations like businesses. Typically, AMCs manage associations of varying sizes – from 10 members to 10,000 members – as well as annual budgets from US$50,000 to US$16 million. Crucially, the AMC model affords association clients the characteristics of economies of scale, experience in the association marketplace, flexibility and adaptability, buying power and centralised facilities. Services provided by AMCs include strategic planning, financial management, executive management, membership development, marketing and public relations, educational and professional development, meeting and event planning.

Why an AMC? While some associations hire staff to run an organisation, others hire an AMC to handle operations. The AMC provides a centralised office that serves as the client association’s headquarters. Any overhead costs are then shared between the AMC’s various clients, increasing each association’s resources and capabilities without major capital investment. Due to the shared resources, specialists are drawn from the personnel pool and are assigned on an as-needed basis. The AMC Institute The AMC Institute is a nonprofit trade association dedicated to promoting excellence among Association Management Companies worldwide. AMCs are crucial for providing leadership in association management and other association services through experienced staff, proven practices and shared resources. They provide full-service professional services to organisations including business and trade associations, professional societies and foundations. The AMC industry (number of firms) has grown by 150% since 1986, and now encompasses more than 670 association management companies across the US and beyond. In addition, AMCs collectively manage annual budgets exceeding US$3.4 billion, and represent more than 7,600 clients. The AMC industry is also a conventions powerhouse, booking nearly 2 million room nights and US$1 billion in meetings and conventions services annually. For more information please visit

Key contact: The AMC Institute

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US – California Michael LoBue, CAE, President & CEO LoBue & Majdalany Management Group +1 415 561 6111

Sizing the value of AMC The recession that began in 2008 has challenged the association sector as it has every other market sector. For associations, one unmistakable result has been the recognition that, as valuable as the AMC-model is during the good times, it can mean the difference between whether an organisation survives and thrives, or dissolves altogether, during challenging economic times. Recent studies have begun to measure the business benefits enjoyed by AMC-managed organisations compared to standalone organisations that shoulder the full costs of occupancy and capital needs and directly employ their own staff, with all the associated employer liabilities and overheads related to employment law compliance. Much more than cost savings LoBue & Majdalany Management Group, an AMC Institute Charter Accredited AMC, and a leader in the AMC market, recently conducted studies comparing the business results of associations managed by AMCs and standalones. The studies not only confirmed that the AMC-model is less expensive than the standalone model, but also that organisations managed by AMCs enjoy significant performance benefits over similar types of organisations using the standalone model of management. These benefits include:

US – Wisconsin Roy Fuerstenberg, President and CEO Documation +1 715 552 5701

“Our goal as an AMC is to deliver resources and valuable counsel to associations that are usually in a wide variety of business cycle stages. […] Documation has played an important role in helping us not only with cost-effective printing but in continuing to deliver products and services that help associations move forward.” John Dee, COO & CFO, Bostrom Corporation Documation is a single-source solution provider of print and digital media. The firm exemplifies the blended management principles of ‘new school’ technology utilisation and ‘old school’ disciplined determination. Further, the firm has combined an excellent mix of premier customers, sophisticated equipment and technology, as well as exceptional employees – all of which has resulted in a growth-orientated and profitable printing company. Incorporated in 1994, Documation has become noted throughout the nation as a premier print and digital media provider to associations, association management companies, continuing education providers and custom publishers. The firm’s acceptance within these niche markets has allowed substantial growth, numerous company and print excellence awards, and industry recognition as ‘America’s Association Printer.’ Documation has also partnered with the AMC Institute, the trade association representing the Association Management Company (AMC) industry, to offer a cost-saving opportunity to obtain high-quality printing services to AMCI Members.

• Higher net profitability • Higher operating efficiency • Lower operating risk • More diverse revenue profiles • Higher percentage of revenue spent on meetings, trade shows and educational activities for their members, and • A third less paid for staffing, occupancy and capital resources. A second study specifically comparing the impact of the current recession on representative samples of AMC-managed and standalone operations demonstrated that: • During 2006 and 2007 – the two years leading up to the recession – these two management models were essentially equivalent in their abilities to generate annual surpluses from operations (68% in 2006 for both models; 74% and 72% in 2007 respectively for the AMC managed and standalone organisations); and • By the end of 2008, 66% of AMC-managed organisations were still generating operating surpluses, whereas only 47% of standalone organisations were generating surpluses. LoBue & Majdalany, founded in 1993 with offices in San Francisco and London, provides management and operational services to international trade associations in diverse technology markets, and to professional groups in retirement and health benefits and medical specialty board certification. Michael LoBue, president & CEO, noted: “LoBue & Majdalany is committed to providing our clients with excellent management based on best practices and the industry research we conduct – not on conventional wisdom or what is in vogue.” He added: “Our commitment to provide Certified Association Executive (CAE)-level Executive Directors, and to retain the highest industry standard accreditation for our firm, demonstrates our investment in services based on industry best-practices and solutions that sets us apart from other AMCs in the market today.”

Roy Fuerstenberg, Documation president and CEO, noted that Documation has been a member of the AMC Institute (AMCI) and its predecessors for 18 years. He said: “Throughout our partnership, we have provided sponsorship monies at the highest level to AMCI. To its members, we have been an exceptional outsource partner by providing a complete range of print and digital media products including meeting materials, magazines, journals, publications, CDs, flash drives and more. “We also provide AMCI members with a generous royalty payment based on annual print and digital media sales dollars. This payment, in combination with our DocuRewards program for AMCI members, provides AMCI Members with the buying power to lower costs to the associations that they manage.” He added that besides the quality and competitive aspects of the firm’s products and services, Documation’s staff are known for their customer care. This encompasses being timely in the delivery process – “meeting what at times seem like impossible deadlines” – and by exceeding the expectations of customers on a daily basis. “They also know we continually upgrade our technology and know they can look to us for modern day solutions for their publication needs,” said Mr. Fuerstenberg. Although the global economic downturn impacted Documation’s growth, the firm was able to withstand any potential damage because of its market variety – and because of the shift to digital products as well as the shift to digital on-demand print production. Mr. Fuerstenberg concluded: “We were able to add superior staff in strategic areas due to the talent availability caused by the recession. We are very positive about several new markets we are pursuing, the rapid expansion of our digital print capability, and the addition of several new senior sales staff. We will be in a position to really excel when the global, and especially the American, economy stabilises.”

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UK Restructuring

UK Restructuring It is essential that distressed businesses understand very quickly which firms are capable of assisting them with their Restructuring & Turnaround requirements. Many companies need restructuring advice on a regular basis, in order to keep them operating as efficiently as possible. This restructuring can be done on an operational basis in terms of selling off underperforming assets, consolidating operations for efficiency, or focusing on different revenue streams that can create greater profit margins. There is often also a need to reorganise the capital structure of a business, to keep debt servicing at a sustainable level, as well as to create the appropriate mix of fundraising options via debt or equity products. All of these decisions are made in an effort to keep a corporation healthy and keep it out of insolvency. According to The Insolvency Service’s most recent statistics release, Insolvencies, in the Second Quarter 2010, there were 4,080 compulsory liquidations and creditors’ voluntary liquidations in total in England and Wales in the second quarter of 2010. This was an increase of 0.5% on the previous quarter, and a decrease of 19.1% on the same period a year ago. This was made up of 1,169 compulsory liquidations (which are down 9.9% on the previous quarter and down 21.0% on the corresponding quarter of the previous year), and 2,911 creditors

voluntary liquidations (which are up 5.4% on the previous quarter and down 18.3% on the corresponding quarter of the previous year). In the 12 months ending Q2 2010, approximately 1 in 127 active companies (or 0.8%) went into liquidation, which is a slight decrease from the previous quarter, when this figure stood at 1 in 120. Additionally, there were 1,311 other corporate insolvencies in the second quarter of 2010 comprising 302 receiverships, 777 administrations and 232 company voluntary arrangements. In total, these represented a decrease of 14.3% on the same period a year ago. Indeed, the impact of the recession has clearly been to accelerate the rate of businesses that find themselves in difficulties; in many cases the key reason for business difficulties has been management inadequacy, which has then been exposed by the financial position. What the recession has done, however, is make it more challenging to turn companies round, due to the difficulties in obtaining liquidity. Early refinancing options are one way of accelerating the options process, which helps secure good offers or other restructuring solutions in a limited timescale. The process allows for flexibility by offering the shares and/or the business and assets for sale. In doing so, goodwill value can be maintained and a ‘fire sale’ avoided. As well as running an accelerated disposal, the early options process uses the same disciplines to source refinance and Management Buy Out exits as well as exploring other options that may be available.


Tyrone Courtman Partner Cooper Parry LLP +44 116 262 9922

Cooper Parry LLP is a regional firm of business advisors with offices in Derby, Leicester, London and most recently Guernsey. The practice provides traditional audit, accounting and taxation services, and also IT, Corporate Finance and Business Restructuring, Recovery and Insolvency services (“BRRI”). Cooper Parry’s BRRI practice is led by Tyrone Courtman, a Chartered Accountant, and Licensed Insolvency Practitioner and immediate past President of the Turnaround Management Association in the UK. Cooper Parry’s BRRI practice provides a comprehensive range of solutions and expertise across the whole underperforming businesses spectrum, from business support, through to those businesses requiring a more formal restructuring through a Company Voluntary arrangement or an insolvency process such as Administration or Liquidation. The firm distinguishes itself by offering a comprehensive solution. The firm is owner managed, has greater empathy with the challenges facing business owners. The firm is truly committed to helping ailing businesses to survive. The practice works with privately owned businesses, their financiers, advisors and creditors. Our client base is broad from Global financial institutions to individual distressed investors on the other. There are a number of recent case studies that highlight Cooper Parry LLP’s expertise. Working with the restructuring of a

private estate of an asset rich (c£25m) but cash strapped landed estate, to advising a Private Equity investor on its investment in a Championship football club. We’ve been working on the formulation of Proposals for Company Voluntary Arrangements. One recently involved a renegotiation with HMRC following the company’s failure to adhere to time to pay promises. Another involved a proposal to compromise creditor claims to facilitate new investment. Recently we’ve been working with a medical supplies business, based in Fareham. This Administration has involved ongoing trading, the negotiation of a settlement of a supply contract, and attempts to find a buyer for its business and assets as a going concern. We’ve also seen a lot of troubled property situations in the last couple of years. The environment for restructuring in the UK still affords one of the most flexible regimes globally. It remains the jurisdiction of choice for businesses with operations in Europe. Whether it is wise to seek an early refinancing will depend on where the business is in the cycle. If you have a compelling proposition then now is probably the time. If you’ve got problems and need to prove the revised model works, then banking another year of improved results is the prudent thing to do. One major factor that influences the timing and the structure of refinancing in the current environment is knowing where your funders are. Further, the sector in which you’re operating is also important. Property is an obvious example. Another is to have a compelling proposition. If you have, refinancing should never be a problem! Whilst Administrations have fallen, we have noticed an increased demand for restructuring. The buyers are different too. Whereas before the clients were led by the banks, now our engagements are led by the management teams. The banks appear reluctant to impose a restructuring on the business. The most obvious legislative change surrounds attempts to regulate pre-packaged business sales. The proposed changes have been deferred for further consultation. So it would seem unlikely that we shall see any change soon.

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Adrian Giles Managing Director Venesis +44 20 7949 4063

Venesis is a consultancy and professional services company that specialises in providing turnaround solutions targeted at the SME market. The company has been delivering a mix of company rescue and venture investment services, blended together with practical hands on turnaround consultancy since 2005. Adrian Giles is the managing director of Venesis. He has proven experience in investment banking, Capital Management, Business Transformation and Company Rescues. He has been responsible for the shaping and delivery of Business Strategies and Postmerger Integration programmes for clients across the UK, Europe and US. He has a particular expertise in delivering accelerated business change using Lean Sigma methods and tools. He focuses upon helping businesses execute and achieve rapid well-planned and effective business change, maximising the ROI benefit while ensuring sustainability of any solution

implemented. Adrian brings specific sector expertise in Financial Services for both Banking & Insurance Services. “Our team has the expertise to deliver practical business recovery solutions,” said Mr Giles. “These include crisis management, negotiating proactively with creditors and lenders, and raising fresh capital where appropriate to preserve the business. Venesis has an extensive network of business angels and other capital providers who look to invest in turnaround opportunities.” In addition to sourcing business critical funding, Venesis also operates its own investment fund and may co-invest alongside other capital providers on both an equity or loan note basis. Venesis has recently been working within both the health and leisure market and the commercial property market sectors. The firm recently renegotiated a repayment schedule with HMRC for a client that extended beyond the usually acceptable 8-12 month time frame. This gave the client enough time for the restructuring plan to begin to take effect. According to Mr Giles, Venesis sees great opportunities in the current economic climate for a more entrepreneurial style of restructuring to take place. Commenting on the anticipated refinancing wave due to hit the UK, Mr Giles said: “Venesis would always advocate seeking professional advice around restructuring earlier rather than later as a general principle. The more time you have, the more options will be available for the client business.” On the subject of timing a refinance, Mr Giles stated that the key factors to consider are: “access to capital outside of the normal banking sources, and access to a restructuring team that has a proven record of ‘fire fighters that have been into burning buildings’. A proven track record is a must.”


Andrew Dunbar Director – London Winterhill Largo Plc +44 20 7079 9278

Winterhill Largo is a national and international specialist asset valuation, recovery and insolvency support business. The firm drives the valuation and realisation of assets, enabling refinancing and other deals to progress with leverage. Winterhill Largo provides a full suite of advisory and restructuring services for lenders, their advisers and insolvency practitioners. The firm undertakes appointments to value and market businesses for sale and provide advice and valuation of the disposal of all balance sheet assets including intangible assets, property & real estate as well as plant & machinery and inventory. Furthermore, the firm provides tailored corporate debt recovery & collection services as well as a range of legal services from a solicitor’s letter service to complex litigation. “Our work provides a credible independent opinion on not just the valuation of assets, but also the delivery of practical and workable exit strategies a crucial aspect of due diligence in any transaction, consequently mitigating lending risk and exposure.,” said Andrew Dunbar, director – London.

Winterhill Largo’s clients mainly comprise restructuring and insolvency firms, asset based lenders, banks, corporate finance professionals and private equity houses. Increasingly the firm is hired to act for overseas clients to handle the valuation and disposal of assets in the UK and around the world. The firm is working on dozens of live cases, ranging from the collection of overdue corporate debtor books to avoid business failure, and the marketing of businesses as going concerns, to valuing and selling plant, machinery, commercial premises and stock. Winterhill Largo works across every sector, and its appointments range from small businesses to global entities. Mr Dunbar believes that the environment for restructuring in the UK is positive as it has arguably more favourable restructuring and insolvency laws to support turnarounds and the restructuring of struggling businesses. “However, that is not to say that the current environement is not challenging as it is well documented that availability to funding is difficult for many businesses and the reduction in time to pay arrangements reflect a harder stance by HRMC,” commented Mr Dunbar. According to Mr Dunbar, seeking refinancing expertise early in any process is the most valuable advice; any advisor can give, as an early decision, even an undesirable one, can save wasting valuable management time and resources; therefore allowing management to focus on viable strategies. “I think the biggest challenge facing businesses will be the availability of the right type of funding especially as some sectors are seen to be struggling as consumers’ disposable income decreases and the UK economy falters,” added Mr Dunbar. With the current fall in administrations, Winterhill Largo’s debt recovery teams are seeing a huge rise in enquiries and appointments in recovery activity, often one of the best options open to businesses that are facing severe problems. “Despite the fall in administrations, our asset disposal experts are also increasingly busy, but this may be in large part due our growth and position as the leader in the market,” concluded Mr Dunbar.

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Route to / Maps CONTENTS PAGE Route to Belgium p92 Profiles of Belgium’s leading corporate and business advisers.

Tax Law Map p94 An insight into global tax experts, with a useful location finder.

Route to Italy p101 Profiles of Italy’s leading corporate and business advisers.

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Route to Belgium

ROUTE TO BELGIUM BELGIUM IS CENTRALLY LOCATED, BOTH ECONOMICALLY AND POLITICALLY, AT THE HEART OF EUROPE. ENVELOPED BY GERMANY, THE NETHERLANDS, FRANCE AND LUXEMBOURG BELGIUM USED TO PROVIDE AN ACCESSIBLE PLATFORM FOR WARFARE. Now, however, Belgium is just as attractive, but for more positive means as a neutral epicentre of political activity and a top commercial destination with its well-established ports of Antwerp, Zeebrugge and Ghent. The European Union, NATO and some 1,400 international non-governmental organisations have their headquarters in Belgium. Furthermore, with easy access to cheap and frequent flights now, Europe’s key business hubs such as Lisbon, Rome, Madrid, Stockholm, Athens, Warsaw, Berlin and Dublin are just a two-hour flight away.

BELGIUM IS THE WORLD LEADER IN TERMS OF EXPORT PER CAPITA AND CAN JUSTIFIABLY CALL ITSELF THE ‘WORLD’S LARGEST EXPORTER’. Economic and Commercial Counsellor at the Embassy of Belgium in London, Mr. Ben De Smit, stressed the idea of Belgium as a well-positioned and logistically strong centre in which to do business. He cited the Belgian ports that foster good commercial links. He said it is also neutral, well-accessible, and bi-lingual with residents speaking many languages.

Mr. De Smit’s department in the Embassy of Belgium promotes small- and medium-sized Belgian companies and entices them to do business in the UK. Likewise, they assist British companies to set up on the continent, attracting investments from Britain into Belgium. He called Belgium an attractive place to invest and do business, because it offers a whole range of different corporate tax reliefs. They include national interest deductions, and incentives for research and development. He enumerated reasons to invest in Belgium: a highly educated, productive, multilingual and flexible workforce; top rate business infrastructure; strategic location in Europe; tradition of openness and international trade; and high quality of life. In addition to this, the Belgian government recently introduced the Notional Interest. This is a new and innovative measure in international tax law by which all companies subject to Belgian corporate tax will be able to deduct from their taxable income an amount equal to the interest they would have paid on their capital in the case of long-term debt financing. In addition, the 0.5% registration duty on capital contributions has been abolished. There are, of course, manifold reasons to consider investing in Belgium. To mention just a few: its transport infrastructure is highly advanced and it has the densest railway network in the world; Belgium is the world leader in terms of export per capita and can justifiably call itself the ‘world’s largest exporter’; Belgian agriculture has developed into a highly competitive sector with one of the highest rates of productivity in Europe; the average value of export and import of goods as a percentage of GDP equates to almost 83%, which is the highest percentage out of all the 25 countries in the European Union; Belgium also holds first place for the percentage of GDP accounted for by foreign direct investment.

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Global Insolvency and Route to Belgium



Grant Thornton Belgium is an independent organisation and a member firm of Grant Thornton International Ltd., one of the world’s leading organisations of independently owned and managed accounting and consulting firms providing assurance, accounting, tax and management consulting services to privately held businesses and public interest entities. The Belgian practice is a dynamic group of 120 highly qualified and experienced people helping their clients in realising their ambitions. Its national and international clients are active in a wide range of industries. In 2009, Grant Thornton started up its Transaction Advisory department with a fully dedicated Transactions Advisory team focussing on a range of transaction support services, such as: financial and tax due diligence; vendor due diligence; valuation services; transaction structuring and ad hoc bid support and vendor assistance services. “As we consider independence to be the cornerstone of our services, we do not accept any sale mandate lead advisory,” explained Christophe De Paepe, partner. The firm provides its services to private equity funds, acquisitive corporate and private investors having a focus on mid-market transactions with an enterprise value between five to 100 MEUR. During the last two years, the team has assisted in more than 50 mid-market transactions in Belgium. Mr De Paepe explained that the Belgian economy grew 2% in 2010, and the IMF forecasts that GDP will increase 1.7% in 2011. According to the National Bank of Belgium (NBB), private consumption rebounded 1.4% year-on-year in 2010 after a 0.2% decrease in 2009,



Lorenz is an international law firm with offices in Brussels, Bishkek and Geneva. The firm offers local and international clients personalised attention, high levels of expertise and a strong reputation from a diverse and experienced team of lawyers. The Lorenz corporate/M&A team handles all types of capital market transactions, private equity and venture capital transactions, private M&A transactions and restructurings. The firm also advises its clients on the acquisition financing aspects of transactions, and assist many clients in relation to the Belgian aspects of domestic and international financial arrangements. Commenting of the factors that distinguish the firm from its competition, Steven De Schrijver, Head of Corporate/ M&A at Lorenz, noted the firm’s special focus on Central Asia and the IT & New Media sectors. “Additionally, Lorenz has a unique approach to handling its clients’ projects. Due to the absence of formal departments within the organisational structure of Lorenz, we are able to customise inter-disciplinary teams to match the needs of our clients,” said Mr De Schrijver. “This is arranged through a single contact partner who coordinates the work of the various team members in order to ensure the efficiency and cohesiveness of the projects.” Mr De Schrijver added that Lorenz is the preferred correspondent for many foreign law firms requiring assistance on Belgian law and regulatory issues. Lorenz also has a strategically located office in Bishkek, which has unique experience in representing international companies and corporations on cross-border M&A transactions throughout the

and is forecast to increase by between 1.4% (NBB forecast) and 1.7% (OECD forecast). 2011 unemployment is expected to remain stable at its 2010 level (8.4% IMF forecast). “Customer confidence picked up again to pre-crisis levels at the beginning of 2011, but is still hampered by the current political and financial situation,” said Mr De Paepe. “On the one hand, the political landscape is very fragmented, with a caretaker government in place for more than a year, as the country has been without an elected government since April 2010. On the other hand financial market pressures on Belgium have increased due to the high public debt – almost 100% of GDP – and, despite limited powers, the caretaker government announced in mid-April that it would take measures to reduce the budget deficit to 2.8% of GDP in 2012. Nevertheless, uncertainties remain, observed Mr De Paepe, as the country needs a government to decide on continued economic policy and related reforms, even if this could bring with it some austerity measures that would hurt household spending. As a result, retail turnover has been only slightly increasing in 2011, driven mainly by price increases, while the volume of sales remained fairly stable. “Business confidence decreased recently back to the lowest level since December 2009. Deterioration was mainly noted in the manufacturing industry and in the business-related services sector,” concluded Mr De Paepe.

Central Asian region. This close international relationship within the firm allows the firm’s clients to take full advantage of its international knowledge base. “We are accessible and totally committed, pro-active and highly responsive,” said Mr De Schrijver. “Lorenz dedicates a partner to each client, who acts as a first point of contract and is responsible for the ongoing professional relationship. We provide legible, to-thepoint, practical and business-orientated advice and take clear positions.” As a result of the worldwide economic crisis, M&A activity in Belgium was significantly reduced in 2008 and 2009. Mr De Schrijver attributed this to the low availability of financing and general risk aversion, which resulted in corporations and private equity players delaying possible investments. “The Belgian M&A market in 2010 dropped off to only €12.1 billion, which is, even for Belgium, rather low,” observed Mr De Schrijver. “Still, during the first half of 2010, the first signs of recovery in the M&A market were visible. Business bankers generally consider 2010 as a good year and are fairly optimistic for 2011. Since the Belgian economy is dominated by small and middle-sized companies, most transactions in Belgium are smaller, with more manageable debt structure.” “The first quarter of 2011 confirmed a return of M&A appetite, since the number of transactions represented a significant upturn compared to the same quarter in 2010. This shows that, despite the political crisis that started in 2010, Belgium remains attractive for investors,” concluded Mr Schrijver.

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Tax Map

Sweden UK


Germany Italy Spain






04 Sweden - Advokatfirman Delphi

UK - Allen & Overy


Mikael Knutsson Special Counsel Tax Phone direct: +46 31 10 72 50 Mobile: +46 709 25 25 92 Phone: +46 31 10 72 00

Bishops Square Tel: +44 20 3088 3606 mark.brailsford

Germany - freshfields

Switzerland - SW Legal

Christian Ruoff Tel: +49 40 36 90 60 Fax: +49 40 36 90 61 55

Jean-Frédéric Maraia Tel: +41 22 707 8000

Italy - CBA Studio Legale e Tributario

Malta - Deloitte

Dott. Paolo Omodeo Salè Tel +39 06 80913201 Fax +39 06 8077527

Conrad Cassar Torregiani Leader International Tax Tel: +356 2343 2000 Direct: +356 2343 2716

Spain - Uria Menendez

India - Lakshmikumaran & Sridharan

Guillermo Canalejo Tel: +34915870942

V. Lakshmikumaran +91-11-4129 9888

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Tax Map

Annual Tax guide 2011 map Mexico - Consultoria Empresarial Rubio Y Asociados Sc

Ecuador - Perez Bustamante & Ponce Abogados

C.P.A. J. Adalberto Rubio Tel: +52 631 313 1920 USA - 520 313 4914

Javier Robalino Tel: (593 2) 2260666 ext.217 Fax: (593 2) 2244462 www.

Brazil - Pellon & Associados Advocacia

Chile - ABL Abogados

N캐alma Cyreno 20.030.090 + 55 21 3824 7821 n캐

Juan Crist처bal Jaramillo Tel: (56-2) 361 04 84 Fax (56-2) 36104 87


Ecuador Brazil


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Annual Tax guide 2011 According to a recent OECD report, due to the recent financial and economic crisis, global corporate losses have increased significantly. The numbers at stake are vast, with loss carry-forwards as high as 25% of GDP in some countries. Though most of these claims are justified, some corporations find loop-holes and use ‘aggressive tax planning’ to avoid taxes in ways that are not within the spirit of the law. This aggressive tax planning is a source of increasing concern for many countries and they have developed various strategies to deal with it. Working cooperatively, countries can deter, detect and respond to aggressive tax planning while at the same time ensuring certainty and predictability for compliant taxpayers. Through the OECD, countries share intelligence on aggressive tax planning schemes and increase international co-operation on detection, responses, and evaluation. Governments should also introduce policies to restrict the multiple use of the same loss and to introduce or revise restrictions on the use of certain losses in the context of mergers, acquisitions, or group taxation regimes. Finally, the report identifies emerging threats for tax revenue, such as aggressive tax planning schemes based on after-tax hedges, and suggests that countries analyse the policy and compliance issues related to them. Today’s increasingly complex tax and accounting regimes and the growing trend towards globalisation means that obtaining the right strategic tax advice has never been more important. The key objective in effective corporate tax planning is to identify the main factors in an organisation’s structure that dictate the opportunities for tax efficiencies. Once identified, corporate tax and accountancy professionals can devise and implement tailored strategies for the business or a particular transaction. From a corporate tax perspective, the success of any transaction rests on the close working relationships that are established between the company and their corporate tax adviser. Nurturing these professional relationships ensures that

tax issues are raised and subsequently solved by specialists at the earliest stages of any transaction, when it matters most in structuring the deal. In addition to this, it is crucial to ensure that overall structure after completion of the deal ensures tax efficiency moving forward. When companies acquire a corporate entity and avail of opportunities such as tax write-offs and the combining of losses, disposal of a non-core business or enter into a merger, it is imperative to manage the tax risk by conducting thorough due diligence in order to provide a detailed review and analysis of both their own company and the target company’s tax position. This should comprise an analysis of tax compliance, tax contingencies and aggressive positions, transfer pricing, identification of risk areas and future tax planning and opportunities. In some cases business operate through an offshore company in a low or no tax jurisdiction in order to minimise taxation exposure whilst maximising profits. The primary benefits of offshore companies vary from country to country in terms of administration, however, most jurisdictions make it relatively simple to set up and maintain companies. In addition to this, offshore jurisdictions tend not to impose ‘thin capitalisation’ rules on companies, allowing them to be formed with a purely nominal equity investment. In recent years certain European countries have introduced measures to discourage tax avoidance and return much needed revenues to the avoiders’ resident economies. Brian Hayes, minister of state at Ireland’s department of finance, signed up to The Multilateral Convention on Mutual Administrative Assistance in Tax Matters at a meeting with the OECD earlier this year. The convention was developed jointly by the Council of Europe and the OECD, and is intended to promote international co-operation on tax matters, particularly as regards to fighting tax evasion and avoidance.

The Organisation for Economic Co-operation and Development +33 1 45 24 82 00

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Christian Aste Mikael Knutsson Partner Senior Tax Advisor Alliende, Villarroel, Contreras y Delphi Eguiguren I Lecaros y Aste +46 31 10 72 50 +56-2 361 04 84

The Chilean tax system comprises a few high-yielding taxes. According to the Chilean Constitution taxes cannot have a predetermined use or target and the government has the prerogative of proposing to parliament any changes to the system. Taxes can be classified in the four categories of income tax, tax on sales of goods and services, specific taxes and others. Chilean tax laws and regulations are only published in Spanish, the country’s official language, and consequently are only legally binding in that language. In 1997, Chile started to negotiate bilateral agreements for the avoidance of double taxation and the prevention of fiscal evasion with respect to taxes on income and on capital. Chile has negotiated double taxation treaty agreements of this type with different countries, based on a number of previously established criteria, among others, the existence of a free trade agreement, a substantial flow of capital and technological exchange to or from Chile, the attractiveness of an economy for both Chileans and foreigners for business development, and strategic interest in the region. When no tax convention is applicable, Chile provides an ordinary credit of 30% for the foreign tax paid on dividends and remittance of profits or, when this is less, for the amount of tax paid abroad. With these taxation regulations in place the services of a dedicated legal team is needed to help foreign investors establish efficient business connections in the South American State.

AVL Abogados is one such firm that is engaged mainly in providing corporate legal counsel to enterprises. The firm has specialised lawyers specialising in the many different areas of the law, such as civil, commercial, tax, labour, constitutional, mining, water, electrical, environmental law and general practice. It also assists in preventing and resolving disputes through negotiations, mediation and litigation before ordinary and arbitral courts. The lawyers of AVL Abogados are also habitually called upon to arbitrate the resolution of disputes. The great professional standing that the firm has attained means that its lawyers are regularly asked to issue specialised legal opinions regarding matters of civil law, commercial law, private international law (conflicts of laws), constitutional law, taxation issues, environment law, mining law and water law. Since its foundation, AVL Abogados has been known for its efficient and personal attention to its clients, as a result of direct intervention of senior partners in virtually all matters of clients’ need. In addition, most of the attorneys at AVL Abogados are professors at the leading law schools in Chile. IP, criminal matters and other situations requiring specialised counsel are entrusted to law firms with which ALV Abogados has agreements for such purpose. AVL Abogados has correspondent law firms throughout Chile and abroad. The firm specialises in a number of practice areas including; arbitration, litigation, general corporate assistance, civil and commercial affairs, constitutional and administrative matters, private international law (conflicts of laws), mining law, water rights, mergers, acquisitions and reorganisations taxation, labor law, environmental law, antitrust law, fair competition, consumer rights, foreign investment, financing, capital market, energy, telecommunications, insolvency and bankruptcy, and real estate.


V. Lakshmikumaran Mikael Knutsson Managing Partner Senior Tax Advisor Lakshmikumaran & Sridharan Delphi +91-11-4129 9888 +46 31 10 72 50

Over the years, the Government of India has strived to bring different entities and revenue streams within the tax net. Cross-border taxation and structuring issues continue to gain importance as India signs different Treaties with other countries. Besides, outbound and inbound investments, transfer pricing and expatriate taxation can significantly impact a company’s global operations. The Direct Tax team at L&S provides holistic tax solutions in through advisory, litigation and compliance support. The attorneys of the firm have a thorough understanding of international tax laws. The firm provides tax withholding reviews for corporates and enable foreign nationals in India to fulfil their tax obligations. The team also represents clients’ interests before various judicial authorities. “At Lakshmikumaran & Sridharan (L&S), we believe that our values have made us what we are today. It is our commitment to uphold these values in everything that we do and we have a high standard of ethics. A strong sense of fairness has always been the guiding light for all our decisions-big or small. We ensure utmost confidentiality in our way of working and earning the trust of our clients is most important to us. Transparency is the very crux of professionalism and we at L&S believe in it,” said Lakshmi Kumaran, founder and managing partner of the law firm ‘Lakshmi Kumaran & Sridharan’ (L&S).

Lakshmi Kumaran specialises in indirect taxes such as customs, excise and service tax, WTO agreements, international trade laws, intellectual property laws and corporate laws. Lakshmi Kumaran has handled several high profile litigations in the Supreme Court of India. His clients include many well known Fortune-500 Companies and big Indian corporates. Before starting his private practice, he held many important positions in the Indian Revenue Service. Lakshmi Kumaran was actively involved in customs and excise policy formulation and legislation. He founded L&S in 1985 and since then, has represented the interests of many international clients at various judicial fora. As a delegate of the International Chamber of Commerce, he has attended the WCO-HS (World Customs Organization – Harmonised System) committee meetings on classification in Brussels. Lakshmi Kumaran has addressed the WCO GATT valuation workshop on customs valuation. As a prolific speaker, he regularly delivers talks on diverse topics such as international trade, taxes and IP laws etc. at acclaimed institutions in India and abroad. He has also written extensively on taxation and trade remedy laws for various publications. The firm is an essential partner for organisations wishing to do business in India and is equipped with its own Corporate Law Team. The corporate law team of L&S advises multinational clients in various sectors such as power, oil & gas, telecom, infrastructure, real estate, automobiles, pharmaceuticals, chemicals, electronics, insurance, information technology etc. in relation to in-bound as well as outbound investments including entity structuring or re-structuring, tax advice, fund repatriation strategies and exit strategies.

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Conrad Cassar Torregiani Leader International Tax Deloitte +356 2343 2716

As an EU member state with a low effective tax rate and low operating costs, Malta has proven to be very attractive to foreign entities looking to establish their business or a part thereof in a manner which is both cost-effective and efficient. The Maltese legal system draws from both Common law and Civil law traditions hence providing a rather unique legal environment. The system permits the structuring of contracts and arrangements in a variety of alternative ways permitting the determination of a course of action which is suitable for the intended purposes. This is also likely to increase efficiency in cross-border situations where the interaction between different legal systems can at times prove to be problematic. “The Maltese tax and legal system is for the most part relatively simple and straightforward. Malta based business is assisted by the fact that the tax system is statute based and is therefore both transparent and predictable in its application,” commented Conrad Cassar Torregiani, Leader of International Tax at Deloitte Malta. “There are however certain country specific features which must be carefully understood and evaluated as they may prove to be serious pitfalls for the ill-advised. By example, as the workings of the imputation system requires that distributable accounting profits and tax profits are properly aligned so as to

maximize the benefits of the system this requires that the accounting for certain transactions under IFRS is properly understood from the outset,” added Dr Cassar Torregiani. Deloitte is a full-service firm in Malta, comprising tax, audit & assurance and financial advisory services. The Malta office consists of 220 staff and is the largest tax practice on the island, which is primarily focused on serving the needs of international clients. Where possible, Deloitte Malta acts as a single contact point for international clients, coordinating various service providers to ensure that all Malta services are seamlessly executed. Deloitte Malta is relatively unique in its scale in Malta, which allows for specialisation amongst the seven tax principals and their teams, servicing clients through an industry approach or market segment specialisation. Clients are therefore matched to appropriate teams that understand their business, their reasons for setting up a Malta-structure, and the issues that need to be addressed to ensure successful implementation. Dr Cassar Torregiani concluded by highlighting some of the legal changes that have recently occurred in transport law in Malta. “The implementation by Malta of the provisions of the Cape Town Convention on International Interests in Mobile Equipment and its Aircraft Protocol, secures locally the Convention’s benefits to banks and aircraft lessors with resultant enhanced levels of secured creditor protection, offering increased certainty concerning rights and remedies in aircraft transactions and providing, in an event of default, added protection to holders of security interests in aircraft.”


Mikael Knutsson Senior Tax Advisor Delphi +46 31 10 72 50

Mikael Knutsson Senior Tax Advisor Delphi +46 31 10 72 50

Sweden has a flat rate corporate tax of 26% which is enforced and collected by the Swedish Tax agency. According to recent OECD reports, the aggressive interest rate cuts and exceptional government support to the country’s financial system helped contain the depth and length of the Swedish recession. The country’s healthy public finances and efficient tax collection carried out by the Swedish Tax agency proved to be a major asset in ensuring its stability. In recent years there has often been talk of a possible future common consolidated corporate tax rate base in the European Union. This has been suggested in order to bring countries with comparatively low rates to raise their taxation to a more average level to help facilitate an equal ground for potential foreign investment. Mikael Knutsson Senior Tax Advisor at Delphi shared some of his thoughts on the matter: “I see that there could be benefits if the CCCTB was introduced, but a far more important issue in my opinion is that Sweden must do what it can to preserve its reputation as a favourable country to utilise for holding company jurisdiction when making acquisitions.” Currently Sweden already has good participation exemption regulations. For example shares can be sold tax exempt in the corporate sector and there are also possibilities to sell assets intra-group without taxation. Mr Knutsson added:

“Lowering the corporate tax rate would most likely have some impact of course but as I said previously the favourable climate for acquisitions and for Sweden as a holding company regime is a far more important issue for investors right now.” Many countries in the EU are likely to encounter some amount of tax evasion, and Sweden is no exception. “Like many countries we have seen a lot of cases where there is alleged tax evasion on real estate structures making use of foreign companies. We also have from time to time encountered court cases that involve business trying to move the profitable part of a multinational to a foreign principal in a low tax jurisdiction during business restructuring. Sweden has had on going discussions on a political level about how to deal with this issue,” said Mr Knutsson. Delphi has expert knowledge in all areas of commercial law. The firm co-operates with law firms all over the world and has business in China and Eastern Europe. Delphi consists of a total of approximately 170 co-workers with about 120 lawyers throughout offices in Stockholm, Gothenburg, Malmö, Linköping and Norrköping. The firm has a dedicated tax practice team that works very closely together with the lawyers of other practice areas to provide the best possible advice. “We believe that we should put in a lot of senior and management time, we don’t ever want to have one senior come in at the start of the project then having only juniors doing all of the work and the senior returning at the end, this is not our way, we like to give proper management attention to every client during every process,” Mr Knutsson concluded.

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Nijalma Cyreno Oliveira Partner Pellon & Associados +55 (21) 3824-7800

In recent years the tax burden in Brazil has risen alarmingly to meet the obligations to service the external and internal public debt and to provide essential public services. According to a study by the Organisation for Economic Cooperation and Development (OECD), Brazil’s tax burden is one of the highest in the world. Besides the high tax burden, the costs of compliance can be equally oppressive, because of the excessive number of taxes and the accessory requirements for record keeping and reporting, supported by a welter of complex laws and regulations. This scenario requires companies to take action on three fronts, planning, prevention and protection. Careful and technically correct planning permits the taxpayer to find the best legal structure to lower the tax cost. Prevention requires person or company to be aware of how to comply with tax laws and regulations, enabling the taxpayer to anticipate possible contingencies and avoid them with security and firm legal support. Finally, protection means taking the applicable measures in the administrative and judicial spheres to defend against unjustified assessments or to obtain preventive remedies to keep them from arising in the first place.

“FORMULATION, IMPLEMENTATION AND FOLLOWUP OF TAX PLANNING ARE APPLIED IN HARMONY WITH THE CLIENT’S ACTIVITY” “Our office provides a broad range of legal services to find the best tax solutions. Formulation, implementation and follow-up of tax planning are applied in harmony with the client’s activity, while the firm carries out a careful analysis of the applicable legislation and regulations,” explained Nijalma Cyreno Oliveira, Partner of Pellon & Associados.

The firm offers a number of specialist tax services including tax consulting on the structuring of infrastructure projects in the electricity, telecommunications, oil and gas, sanitation and transportation sectors. Pellon &Associados also provides specific tax consulting for the financial, capital, and insurance markets. Brazil has seen some positive levels of economic growth in recent years that is set to attract foreign investors to the country. This level of potential new business will increase the need for firms that can assist foreign investors looking to set up shop in the South American State. “One of the attractions of Brazilian tax legislation to foreign entities is the income tax exemption on remittances abroad to profits distribution,” added Mr Oliveira. Pellon & Associados is equipped to deal with the demand for specialist services of international tax consulting in transactions involving foreign direct and portfolio investments and international remittances resulting from import and export operations, as well as profit and dividend remittances, payment of royalties, and repatriation of capital. Recently, domestic developments in Brazil have led to changes to the tax legislation which provide tax benefits and incentives for the necessary structures to the 2014 FIFA World Cup and to the 2016 Olympic Games in Rio de Janeiro. While the country begins to make preparations for these two prestigious events, native businesses will likely have to increase their organisation in terms of tax compliance and accounting to deal with the potential increase in revenue. Pellon & Associados is ready to assist firms with correct calculation of taxes and reviews and preparations of tax returns and other reporting documents. The firm also provides and organises the presentation of seminars and training sessions (including in-company) on specific tax questions and changes in laws and regulations, and their interpretation by the administrative and judicial courts. The firm can assist with preparation and follow-up until the final instance of formal tax consultations (requests for binding interpretations) posed to the tax authorities, as well as administrative requests to receive refunds or the taking of future offsets of taxes unduly paid, and also requests for tax benefits and inclusion in special installment payment regimes. In the worst case scenario Pellon & Associados can represent clients to the final stages in lawsuits involving tax matters, both to defend against tax collection suits and to seek recognition of legal rights, including the drafting of all court papers.

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Italy Dott. Paolo Omodeo Salè Chartered Accountant CBA Studio Legale e Tributario +39 06 80913201

Notably the Italian Tax System has never been very attractive for foreign investors due to high tax rates, the current uncertain and complex times as well as the costs of procedures and litigations. On the other hand in addition to the adoption of most of the EU Tax Directives, a relevant number of corporate income tax provisions are now very much harmonized and aligned to EU Corp Tax Standards (i.e. Participation Exemptions, CFC and others). Therefore, at the end, the overall Italian Tax environment may not seem so unfamiliar to foreign investors. Recently a provision enacted by the government allows EU enterprises investing in Italy to apply one of the EU tax regimes rather than the Italian tax regime. In accordance with such new rule (so-called: European Attraction Tax Regime), this special treatment can be applied for three years only under the condition that investors have to start a “new” business in Italy. Therefore, EU companies, which start a “new” business within Italian territory, should be able to choose and subject their Italian profits to any of the existing EU tax regimes. In addition it should be noted that big corporate taxpayers (turnover in excess of €100 million) should now be treated in a different way by the Tax Administration falling into the so called Tutorship Program. This allows the competent tax office to gather all the relevant information, contracts and data of the company, deeply study and evaluate the overall business, its model and its risks and in principle allowing the taxpayer to check in due course the position and views of the Administration in order to reduce therefore the current level of uncertainty and operational risks. In addition to this the Italian tax system includes a relevant number of cases/ provisions in which the taxpayer may opt to get a preliminary tax ruling: such as CFC, transfer pricing, extraordinary transactions and tax avoidance cases. Also this “new” way of dealing in coordination with the tax office is changing very much the relationship with taxpayers who are now much more visible and well known. An important role in this process is obviously plaid by tax firms and consultants who intermediate and represent more and more actively the position of the

corporate clients before the tax office. One of these situations in which the quality of the exchange of information and data is very relevant are the new documentation requirements for transfer pricing purposes. Indeed a duly and complete transfer pricing study supporting a master file and country file under the OECD guidelines may eliminate, in case of audits, the application of the relevant high penalties. Therefore, due to these legislative enforcements, the relationship between large corporate taxpayers and tax administration is becoming less (random) audit based and more structured and cooperative, increasing transparency of processes and clear definition of positions from both parties. This is the area where tax practitioners may play an important role, now in Italy. CBA is one of the top law firms of the Italian market and probably one of the most recognised in all the combined offerings of tax and corporate solutions respected by the tax offices when assessing planning and transaction tax techniques, as well as during any of the litigation and pre litigation procedures. CBA assists and represents clients before the Tax Courts and up to the Supreme Court as well as before the European Court of Justice. Notably some of the most interesting cases from a consultancy and litigation assistance standpoint are currently related to international tax issues such as : interest expense and transactional cost deductions in LBO operations; disallowance of CFC rules; non residence tax status of foreign holding, royalty and finance companies of Italian groups; application and disputes of transfer pricing criteria and methodologies; recognition of foreign tax credits in certain financial transactions; last but not least disallowance of domestic rules on simulation and re characterisation of contracts/operations and abuse of law cases. In fact more and more the Italian Tax Administration tend to assess taxpayers on these relevant areas investigating not only the economic data and financial records but also on the needs and business reasons of the entrepreneurial decision in order to check its validity and whether an independent party in the same situation and conditions would have executed similar transactions.

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Route to Italy

Route to Italy Italy has a diversified industrial economy with roughly the same total and per capita output as France and the UK. Its economy enjoys an exceptional strategic location as the gateway to the EU from Africa and the Middle East. Further, the country’s advanced transport infrastructure enables swift travel from the Calabrian coast to the northern cities of Milan and Turin. According to GDP calculations, Italy was ranked as the seventh-largest economy in the world in 2006, behind the US, Japan, Germany, China, the UK and France, and also stands as the fourth largest in Europe. According to the OECD, in 2004 Italy was the world’s sixth-largest exporter of manufactured goods. The economy remains divided into a developed industrial north, dominated by private companies, and a less developed agricultural south. Invitalia is Italy’s national agency for the attraction of investment and development in Italian companies, and acts on behalf of the Italian government to increase the competitiveness of the country, particularly the south, and to support the strategic areas for development. Its aims are: to encourage the attraction of foreign investment, to support innovation and growth of the production system, and to harness the potential of the territories. The AIFI (Italian Venture Capital and Private Equity Association) was created in May 1986, in order to promote, develop and represent institutionally venture capital and private equity activity in Italy. The Association is an organisation composed of different entities which, throughout direct investment of their own funds, or through the management and advisory of independent funds (closed-end funds), are private equity and venture capital investors with the objective of purchasing, managing and divesting in unquoted companies. Members can take advantage of becoming part of a private equity community and entering into a network of likeminded advisers and legal firms. Members are entitled to acquire information and in-depth industry updates through circulars, monthly newsletters and publications. At present, the AIFI maintains 129 private


a Patent L

equity and venture capital members including banks, financial intermediaries, management companies and advisers of international funds – as well as linking together 130 associate members, including institutions, consulting firms and legal firms. Meanwhile, Borsa Italiana S.p.A., which has been operational since January 2nd, 1998, is responsible for organisation and management of the Italian stock exchange. Borsa Italiana has been a part of the London Stock Exchange Group, following an agreement signed in June 2007, and its primary objective is to ensure the development of the markets – maximising their liquidity, transparency and competitiveness, while pursuing high levels of efficiency. It organises and manages the Italian stock market, with the participation of domestic and international brokers who operate in Italy or from abroad, through remote membership using a fully electronic trading system for the real-time execution of trades. Corporate INTL spoke to a number of leading advisers in Italy about the roles they play, and the sectors that they represent.

Italian Private Equity and Venture Capital Association (AIFI)

Borsa Italiana Invitalia

Ing. Gianfranco Dragotti, Founder and Member of the Board Dragotti & Associati +39 02 29014418

Founded in 1978 by Mr. Gianfranco Dragotti, Dragotti & Associati is an Italian patent and trademark consulting firm which specialises in all matters relating to IP, and assists Italian and foreign investors in nurturing and protecting technological innovations and corporate brand names. Dragotti & Associati operates from two main offices, Milan and Treviso, employing 15 consultants and more than 30 staff members, and offers an integrated service following clients’ needs from preliminary studies, drafting and filing applications to prosecution with the Italian Patent and Trademark Office (UIBM) and with major international organisms. According to Mr. Dragotti, when considering investing in IP rights on the Italian market, foreign investors are mainly concerned with whether those rights could be enforced against infringing competitors within a reasonable timeframe and with a fair-minded attitude from courts with regards to ‘foreign vs. national companies’. He said: “Italian law has been constantly amended to be harmonised with the European Patent Convention (EPC), and to incorporate European Directives as regards IP. As a consequence, the decisions of the Italian specialised courts are nowadays quicker than they used to be, and increasingly aligned with the approaches of the main European countries – especially Germany.” When asked if investors are becoming more aware of the repercussions of not paying attention to the importance of patent protection, Mr. Dragotti said that these investors are usually well aware of the importance of IP rights; however, a similar level of awareness is not always found in the Ital-

ian companies in which they invest. Further, he explained that the economic downturn had a moderate impact on the patent sector, given the strategic and anti-cyclical nature of IP. Nonetheless, an increased attention to costs control is moving clients to rationalise IP portfolios focusing on countries where they have – or plan to have – a solid presence. He said: “The Italian state has recently taken several measures to promote IP culture among domestic companies. Probably the most effective piece of legislation was introduced in July 2008, stipulating that all Italian patent applications not claiming a priority are transmitted to the European Patent Office (EPO) to carry out a search report establishing prior documents which may affect novelty and/or inventive activity of the claimed invention. “As a consequence, within nine to ten months after filing, each Italian patent application receives such a search report, together with a written opinion on its patentability. Applicants can therefore better evaluate the patentability, as well as the strength, of the application and of patent that shall be granted thereon – well before making decisions involving high costs.” September 2011 Corporate INTL 101

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L Aviation

Laura Pierallini, Partner Pierallini e Associati +39 064 550 8701

The main cross border and international challenge involved in transport law is finding a solution to achieve worldwide harmonisation in terms of laws and rules on air transport. This can often prove difficult as countries from different regions are most likely to want to continue to practice under regulations that currently suit their geographic position’s agenda and do not wish get involved in international negotiations that could add to existing difficulties within the transport industry. In Italy, one of the most significant challenges interesting the European aviation law is that concerning the implementation of Functional Airspace Blocks (FABs) within Europe. The concept of FABs was developed in the first legislative Package of the Single European Sky (SES) in 2004 and further developed in the second legislative package of SES in 2009. FABs aim to reduce fragmentation stemming from different rules and operational requirements on which the air navigation service providers offer their services in each Member State’s airspace. The fragmentation at issue negatively impacts on safety, limits capacity, and adds to costs. Nine FABs are currently developing and will replace the 67 portions of airspace currently in place in Europe. Italy is involved in the FAB Blue MED initiative, which includes also Cyprus, Greece and Malta. Furthermore, on 27 January 2011, the EU Commission launched an infringement procedure against several Member States, among which Italy, concerning bilateral aviation agreements with Russia. According to the Commission, these Agreements may hinder competition, breach EU rules on freedom of establishment and provide a basis for Siberian overflight charges which may be illegal. As a consequence, Italy (as well as the other Member States involved) will likely be called upon to modify its bilateral with Russia. Pierallini e Associati is a multidisciplinary law firm based in Rome and

and Banking


Milan, having access to a worldwide network of corresponding law firms. The firm is focused on Aviation Law and has also extensive experience in providing a full range of legal services in corporate and commercial law, as well as in other areas of laws, including among others, banking, insolvency and corporate restructuring, competition, M&A, labour and employment, trademark and IP, real estate, litigation and arbitration, tax and white collar crimes. Inter alia, the transport law experience of the firm includes; aircraft financing, labour and regulatory, litigation and passengers’ claims, aircraft insurance, registration and de-registration of aircraft in Italy, assisting handling companies and airport managing companies. During the economic downturn many areas of the legal sector encountered a sharp decrease in incoming business. Some firms reinvented themselves and adapted their services to facilitate the different legal needs of their clients that came with new business. In the case of Pierallini e Associati, the firm has been able to maintain its steady workflow. The firm has adapted to these changes by using its extensive and diversified experience and its integrated practice area teams to provide expert legal advice to all of its clients. “The amount of work provided to clients by our firm has not been affected by the global economic slowdown, but in certain cases there has been a change in legal services requested in light of the economic difficulties faced”, Laura Pierallini concluded.

Francesco Del Bene, Partner Del Bene De Vitis & Associati +39 0832 458279

Del Bene De Vitis & Associati is an Italian law firm with a significant background in national and international law, offering legal services in the major financial and industrial markets. The firm provides comprehensive, cost-effective, legal services to a client base comprised of large industrial companies, public entities and financial institutions, as well as small businesses and individual entrepreneurs who seek legal advice regarding business matters. According to Prof. Francesco del Bene, partner, in the field of banking and finance legal services the firm assists in the drafting of agreements underlying a wide range of transactions. These include national and international financing arrangements, syndicated loans, letters of credit, retention and performance bonds, financial guarantees, finance leases as well as corporate acquisitions, among other areas. Mr. del Bene noted: “In respect of structured and corporate finance, the firm helps clients to structure transactions entailing: the issue and placement of financial instruments and the securitisation of receivables, by taking charge of due diligence assessments and the drafting of the related offer documents and agreements as well as by liaising with the oversight authorities.” Mr. del Bene added that the Italian financial system has experienced a profound structural change in the last decades. “The Bank of Italy has pursued the intermediate objective to achieve more competition in banking,” he said, “together with a sizeable number of mergers and a start on reorganisation projects.” He went on to explain that the degree of competition within Italy’s financial

industry is now comparable to that of other advanced economies. The increasing competition has contributed to the strengthening of the capital base of Italian banks. Among the most important of the financial instruments recently introduced or used widely in Italy are ‘derivatives’, which have surpassed the traditional techniques of risk management and risk allocation both in convenience and in cost. “Even though the Italian banking system has felt the turbulence coming from foreign markets and banking systems, it has so far fared better than others during the crisis,” said Mr. del Bene. “This is thanks to: a brokerage model mainly orientated towards retail lending and funding, to relatively low debt of the private sector of the economy, to strict rules, and to the action of a careful supervision. Furthermore, the indebtedness of the private sector in Italy is lower than that noted in the other relevant countries. “However, the underlying factors are still present: the Italian banking and financial system is still relatively fragmented and marked by a low level of concentration; meanwhile, technological innovation and advances in telecommunications have only recently begun to produce their effects.” He concluded: “Regarding the macroeconomic framework, the greatest risk of a weaker-than-expected recovery stems from uncertainties in the international markets – due to fears of ‘contagion’ of the difficulties of countries with debt sustainability problems.”

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Enrico Tomasetti, Director Studio Tomasetti +39 33 32752294

t Law Contrac

Giuseppe Grillo, Founding Partner Grillo Sibilla & Partners Studio Legale +39 06 44238768; +39 02 36531050


Studio Tomasetti is distinguished for its originality and innovation on providing services specially tailored to its clients’ needs, employing only qualified and field tested legal practitioners. The firm’s approach is to put the client at the centre; meanwhile, the results provided by the firm must be tangible, concrete and measurable. Studio Tomasetti’s approach has always been to tailor its service delivery to meet the needs of its clients. In addition, the firm’s competent and reliable contractors and managers offer proactive solutions with the aim of realising concrete results. On an increasingly competitive business platform, the firm partners with clients to assist them in fulfilling their corporate goals. What’s more, Studio Tomasetti provides experience, methodologies and effective and measurable results. Each project is carried out by a mixed team that integrates the resources of the customer – with the aim to involve and educate so that the client can proceed independently from the conclusion of the project. From diagnosis to solution Studio Tomasetti’s accurate analysis and concrete solutions enable effective strategic and operational response in all areas of business management, such as corporate restructuring advice. From the definition or implementation of a new business idea or entrepreneurial endeavour, to the redefinition and modification of a currently operating business idea, the firm plays a proactive role in planning integration.

“The firm’s approach is to put the client at the centre; meanwhile, the results provided by the firm must be tangible, concrete and measurable.”

Grillo Sibilla & Partners was founded in 2003 by Giuseppe Grillo and Francesco Sibilla, and progressively grew with the addition of other partners and professionals until it reached its current structure, based both in Rome and in Milan. All of the partners share traditional training combined with internationally gained experience within a global network. This allows Grillo Sibilla & Partners to interact with foreign contacts for representing companies in the structuring and negotiation of contractual relationships. Mr. Grillo said: “Our firm has consolidated contacts – both clients and colleagues – in several European countries in the US and in the Middle East.” Grillo Sibilla & Partners’ primary function is – firstly – the analysis of the Client’s business and – consequently – the negotiation of the most appropriate contractual structure, either typical or more often ‘atypical’: contracts which are tailored to prevent/control future problems and all risks through the insertion of ‘ad hoc’ clauses and guarantees. “Through the years,” Mr. Grillo said, “Grillo Sibilla & Partners has learned that clients – i.e. foreign investors – shall be rendered perfectly aware of the peculiarities of the Italian juridical system, especially in relation to the consequences that might arise from the possible termination of a contract and to our labour legislation.” In light of the above, the firm’s efforts are always focused on the most appropriate structuring of the different operations, on the subsequent negotiation phase and on the insertion of special clauses that result from the application of the technical instruments – from the most traditional to the most innovative ones offered by the Italian Civil Law system. Mr. Grillo concluded: “Meanwhile, it is unquestionable that the global economic downturn has had, and is still having, a considerable impact on Italy. Nonetheless, it is also true that the best opportunities and operations are often caught and concluded in crisis periods. “What we notice is that – for example – real estate investments have become particularly convenient, not only in relation to the purchase of immovable properties by foreign individuals for living purposes, but also in relation to operations aimed at investing in the field of real estate for starting and running in Italy commercial activities of different nature. We catch a further trend, especially in the current period of global economic downturn, as manifested by several among our Clients: the need to re-structure their companies and businesses by re-organising all the relevant contractual relationships, with specific reference to supply and distribution agreements. This is now evident and a close eye should be kept on it.”

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Rocco Panetta, Managing Partner Panetta & Associati Studio Legale +39 06 96035356-7 /

otection Data Pr

Prof. Avv. Emilio Tosi, Managing Partner TOSI & PARTNERS – High Tech Legal +39.02.76012753


Highech LL eg al al HighTTech eg

Ranked among leaders by Chambers Europe 2011, Panetta & Associati Studio Legale operates worldwide providing services to private companies and public entities as well as to individual persons. The firm, as well as offering specialized assistance to companies and groups in all fields of commercial law, civil law, corporate and administrative law, has acquired significant experience in each of the new markets: energy, environment, renewable sources and telecommunications. Panetta & Associati’s lawyers are also leaders in providing assistance in privacy and personal data protection. Rocco Panetta is the managing partner of the firm and a lawyer with a huge expertise in the areas of energy, infrastructure, environmental and TMT – corporate and regulatory. Mr. Panetta noted that Panetta & Associati mainly focuses its practice on energy infrastructures and environmental (corporate, regulatory, dispute resolution) as well as IT, media and telecommunications (corporate, regulatory, dispute Resolution). Rocco Panetta is ranked amongst leaders in the TMT sector by Chambers Europe 2011; he is also the winner of the Corporate Intl Magazine 2011 Global Award for “Telecoms Lawyer of the year in Italy” and ranked by TopLegal in the TMT field and by Who’s Who Legal as well. He said: “The highest standards in providing legal assistance are met thanks to a total commitment to clients’ needs and requirements, provided via constant teamwork and a single-target assignment of deals.” When asked to discuss the key areas of corporate law that the firm is currently most active in, Mr. Panetta noted: “Resilient sectors include M&A, advising clients in structuring and completing joint ventures, acquisitions, strategic alliances, equity investments, corporate restructuring and spin-offs. Also: commercial contracts; drafting and negotiating commercial agreements such as supply, agency, re-sale, distribution and manufacturing agreements; transportation of power and gas; power purchase agreements; and other areas. “With respect to the telecoms sector, we mostly focus our activities on drafting and negotiating any kind of relevant agreements, including interconnection, ULL, hosting and housing.” In addition, Panetta & Associati maintains a truly global client base, including: • SunRay Italy (Sunpower Group) – Panetta & Associati is currently assisting the client in procedures to obtain authorisation for three large photovoltaic plants (60MWp) in southern Italy, including the environmental impact assessment. • GE Nuovo Pignone (General Electric Group) – Panetta & Associati is currently assisting the client in a large compliance and IT regulatory project. The same activities were rendered to other 27 GE Group Italian legal entities. Mr. Panetta concluded: “Crucially, Panetta & Associati has not been severely affected by the global economic downturn as we try to diversify our areas of practice as much as possible. “As regards future developments and plans, the main potentialities reside in new sectors such as environment area, renewable energy, TMT and cloud computing. All of these fields open new global horizons, and give rise to innovative markets – which certainly represents new opportunities to extend our business activity.”

TOSI & PARTNERS – High Tech Legal was founded in 1980, with its main seat in Milan as well as an office in Rome. Today, the firm is a law boutique of 15 people between partners, associates and staff with academic expertise in data protection, IP/ICT and high-tech corporate legal issues. The firm also offers advice pertaining to corporate, banking, ‘231’ compliance, litigation, arbitration and real estate. It is led by managing partner Prof. Avv. Emilio Tosi, a lawyer in Milan and a professor of Contract and High Tech Law at the University of Milan. Prof. Tosi noted that doing business in Italy requires a preliminary analysis of data protection issues. Before starting a business, it is important to check types of data – common or sensitive – and sites of data processing – Italy, EU, extra EU – as well as purposes and means of processing and duration. He added: “All of this fundamental data shall be collected in an information privacy sheet called ‘Informativa Privacy’ for communication to every data subject, in order to let them get acquainted with the main aspects of processing and rights – i.e. the right to cancel data if it is wrong, or the right to integrate incomplete data.” “Also, an annual update of a general document called ‘Documento Programmatico per la Sicurezza’ (DPS), containing the complete description of corporate security data measures implemented to protect databases, must be updated by the 31st of March of every year.” When asked about the potential repercussions for those foreign investors who do not pay adequate attention to issues of database protection, Prof. Tosi added that not complying with Data Protection Code means to undergo the risk of data process stopping by the Italian Data Protection Authority (Garante per la protezione dei dati personali), as well as risk of administrative fines and heavy criminal sanctions. Prof. Tosi furthermore noted: “In addition, in recent years, investors have developed greater attention to the special issues of data protection and data security, as well as due diligence checking of data base in company acquisitions. This is not only for fine increases and criminal sanctions, but also for acknowledgement of added value of corporate data policies being a factor appreciated by consumers and, consequently, enhancing competition power of the incoming investor in the Italian market.” “Meanwhile, TOSI & PARTNERS’ own upcoming case work may be affected by the recent Law n.106/2011, a major simplification process of data privacy duties. It can be summarised highlighting – among other things – the abrogation of data protection duties as regards processing of data referred to sole corporate entities’ relationships for administrative purposes.”

“TOSI & PARTNERS’ own upcoming case work may be affected by the recent Law n.106/2011, a major simplification process of data privacy duties.”

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a Family L

Fabiana Polikar, Partner Grillo Sibilla & Partners Studio Legale +39 06 44238768; +39 02 36531050


Grillo Sibilla & Partners was founded in 2003 by Giuseppe Grillo and Francesco Sibilla, who were then joined in partnership by Fabiana Polikar and Francesca Sgarrella. According to Mrs. Polikar, Italian family law is quite articulated. On a national level, in 2006 Law No 54 modified the substantial and procedural rules governing personal separations and divorces. The new principles of ‘equal parenthood’ and ‘joint custody’ were in particular introduced. They will have a significant bearing on future cases. In fact, it is now stated that a minor child has the right to maintain a balanced and continuative relationship with each parent, to receive care and education from both of them, and to keep significant ties with the ascendants and relatives of each parent. “The judge is currently required to consider joint custody as an absolute priority and to grant exclusive custody only in exceptional cases” said Mrs. Polikar. At the beginning, she explained, the practical application of the referred principles caused several problems. The first decisions issued by the courts revealed inner inconsistencies, and the concept of ‘joint custody’ was often misinterpreted. However, it has been progressively clarified: “Despite the difficulties that still exist in daily practise – in particular in terms of inevitable conflicts between parties who are literally obliged to act as parents while perhaps fighting as spouses – it is true that the current approach of the courts aims at guaranteeing the equal position of the litigators as never before. Quite an achievement,” she commented. On a European level, it should be underlined that within the Italian jurisdiction, and before the different competent courts, all relevant regulations are strictly applied. “Specific reference should be made to the EC Regulation No. 2201/2003 con-


cerning recognition and enforcement of judgements in matrimonial matters and in matters of parental responsibility. Also, more recently, to EC Regulation No. 1259/2010 implementing an enhanced cooperation in the area of the law applicable to divorces and legal separations, which will become applicable as from June 21, 2012.” “The real challenge”, Mrs. Polikar added, “is represented by the constantly increasing number of marriages between Italians and foreigners coming from countries outside the European Union – mainly Arab countries, China and Far East countries.” The Italian system of Private International Law (Law n. 218/1995, section IV, Articles from 26 to 37) actually provides all the necessary instruments for dealing with these situations. Nonetheless, its implementation appears highly demanding and imposes a specific expertise. In the latter cases, custody disputes and assets related issues are the most delicate areas. In fact, according to Mrs. Polikar, “Family Law Lawyers not only are requested to face unquestionable cultural differences, but also to deal with sophisticated international company structures (i.e., family holdings) and with the need to shield considerable immovable properties, paying special attention - in the brief term - to the mutual position of the spouses and in the long term - to the perspective needs of minor children and future generations”. “It might become complicated, but this is the field in which our Firm has actually obtained the most satisfactory results,” she concluded.

Quirino Mancini, Partner Sinisi Ceschini Mancini +39 06 322 1485 |

Sinisi Ceschini Mancini (SCM) enjoys a multi-decennial gaming law activity which makes it one of the oldest and most robust and consolidated specialist practices in Italy, with a special focus on foreign-based gaming operators. The firm is in a position to provide its clients with a unique one-stop-shop service offering qualified advice and assistance for: legal and regulatory matters, licensing and day-to-day compliance, local partnership contracts and dealings with the Italian authorities and local banks, as well as administrative filings and accounting. Quirino Mancini noted that since July 2006, when the Italian gaming market was opened up and remote gaming was legalised and regulated, the local industry has been experiencing a consistent growth that culminated earlier this year in the legalisation and subsequent regulation of all type of cash games, thus making the Italian market probably the best regulated in Europe. So much so, that it has become a reference model for other jurisdictions such as France, Denmark and Spain – which have since legalised online gaming, adopting a national licensing regime that very much replicates the Italian one. When asked about the firm’s collaboration with ALFA INTERNATIONAL, particularly as regards its cross-border gaming law work, Mr. Mancini said that apparently the firms belonging to this network do not seem to be handling any gaming business, or at least he never had a chance to receive or send an assignment concerning a gaming client. He added, however, that SCM is also a country member of the International Masters of Gaming Law, another international network with more emphasis on the gaming business. In this regard, he noted: “I do plenty of cross-border work, since a good 80% of my gaming clients are based abroad. Further, I have been an active IMGL fellow member since 2000 and, indeed, I am its first Italian general member. I am consequently involved in various IMGL committees,

and act as a regular speaker at the IMGL bi-annual conferences. Over the years I have cross-referred lots of work with other IMGL members.” SCM’s core gaming client base is comprised of top foreign operators seeking or holding Italian licences, as well as those who have entered the market through local joint ventures or acquisitions. Mr. Mancini explained that gaming is the third largest industrial sector in Italy, with a total turnover in excess of EUR 70 billion; hence, given these huge figures, one cannot genuinely expect that it could be totally crime-free. That said, however, due to the full traceability of online gaming transactions – which is ensured by a 24/7/365 real time connection between operators’ gaming platforms and the Italian gaming regulator’s central control system – it is very difficult to use online gaming as a tool to perpetrate serious criminal offences. When asked about recent regulatory developments, he replied: “Earlier this year, the rules concerning all cash games except online slots were fully implemented – and that was the last big piece of the regulatory puzzle still missing. Once online slots too are regulated – hopefully sometime towards the end of this year, or early in 2012 – the puzzle will be complete, and those few big international operators who have not yet sought an Italian licence will join the party. They should also be enticed by the early booming figures of the Italian market’s response in the wake of the launch of the first online poker and casino platforms.” September 2011 Corporate INTL 105

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Guglielmo Burragato, Partner Ichino Brugnatelli e Associati +390248193249

The Italian economy shows strong contradictions at the present time: it is still one of the most developed in the world, further boosted by high public literacy and efficiency in the labour force. Moreover, Italy boasts a high standard of living, with its per capita GDP higher than the EU average. On the other hand, the Italian government debt is one for multinationals to do business.” of the highest in the world, and the economic growth is at the lowest Mr. Burragato continued: “These evolutions should increase the imporlevel among the industrial countries. tance – as contractual agents – of the European Works Councils (EWCs). The excessive rigidity of employment law is widely considered as one of the reasons for the weakness of Italian economic growth; but, according to Guglielmo Burragato, partner at Ichino Brugnatelli e Associati, something is going to change on this side. He noted: “Employment contracts for blue-collars, white-collars and executives are regulated by the Italian Civil Code, as amended by several pieces of legislation; meanwhile, particular importance is given to National Collective Agreements (NCAs). Most of these regulations are compulsory – since neither can they be departed from by any company collective agreement, nor by any employment contract – and put heavy ties on mediumor big-sized employers, with regard to individual and collective dismissals in particular, and to salary costs in general.” However, Mr. Burragato said, during the last months, due to the economic crisis, steps have been taken in order to allow each company to negotiate its own employment agreement with the relevant trade unions representatives, even if departing from NCAs with respect to some provisions. Also, wider chances of such kind of ‘deregulation’ have been announced by the Italian government. This should make Italy an easier place


turin Restruc

EWCs were introduced by Directive 94/45/EC, which was firstly partially accepted in Italy in 1996 by an agreement signed by three leading trade union federations on one side, and by Assicredito and Confindustria on the other side. It was fully enacted afterwards by Italy Law Decree 2002/74; the policy was then amended by EC Directive 2009/48.” Mr. Burragato said that at the beginning, the unions and the multinationals operating in Italy were not taking EWCs into great consideration, and in fact regarded them as copies of existing nationwide entities in charge of information and consultation. But a deeper interest into EWCs has arisen in recent times – as they can facilitate cross-border communication, information sharing, and Europe-wide company negotiation.” Ichino Brugnatelli’s own relationship with prime banks, institutions, and corporations in Italy dates back to the founding of the firm in the 1890s. For more than a century, the firm has served corporate counsel across a wide range of economic sectors on a full spectrum of issues, included multinational or foreign companies operating in Italy, or interested in doing so. In the early ‘90s, Ichino Brugnatelli won a ‘Job Centre’ case in front of the European Community Court, which allowed for the first time international temporary job and staff leasing suppliers to do their business in Italy.

Giovanni Tretti, Partner Studio Legale GTA +39 0444 547317

Studio Legale GTA (GTA) is a boutique firm located in two seats in the north east of Italy – Vicenza and Bassano. The firm is the outcome of the experience of its founder partner Giovanni Tretti, both as general counsel ! to a prominent Italian company in the apparel and sport industry for more ! than ten years, and as a partner for more than seven years of one of the topGiovanni Tretti avv. ten Italian law firms. ity of a business, such as banks, main suppliers and trade unions. In this regard, GTA the Italian Banking Association has adopted a code of conduct for Studio Legale Today, GTA assists Italian and international companies in areas of commercial restructuring aimed Vicenza at favouring business as a going concern – and faContrà Porti, 21 - 36100 - Italia law including restructuring and turnaround, IP, labour and environmental, vouring rescue – rather than insolvency or bankruptcy procedures. Via C.Colombo, 102 plans - 36061 Bassano del Grappa M&A and due diligence, real estate, legal compliance, as well as arbitration Tretti added: ”Restructuring turnaround of industrial and Main desk.Mr. +39 0444 547317 fax +39and 0444 234093 and litigation. According to Mr. Tretti, the global economic downturn highcommercial activities, from a legal standpoint, involves selecting the lighted an increased interest of the Italian business community in restructurmost appropriate instrument as well as the best adviser for the related ing and turnaround activities. Recent modernisation of Italian bankruptcy law court proceedings. It also means selecting the best support for conduct! and ing negotiations with financial creditors and investors in M&A and due has focused on turnaround efforts and protection of companies’ business ! assets, rather than of the creditors’ interest. diligence activities, and for managing labour and environmental aspects, Mr. Tretti noted: “Such modifications aim to protect investments – and to and overcoming liabilities for civil damages and crime implications. favour the transfer of business operations as a going concern – from creditors’ Knowledge of all of these aspects is therefore relevant in selecting the claims during the state of crisis of a company. Reliability of restructuring best legal adviser.” plans are granted by expert appraisal, and through a faster process of approvAmong GTA’s own recent successes is a case concerning Socotherm al by the competent court. The main legal options are given by the updated Spa, a global leader in the oil and gas pipe coating and public sector, Composition with Creditors – Concordato Preventivo – and by the Scheme of which is listed on the Italian Stock Exchange. For this transaction, Mr. Arrangement – Accordo di Ristrutturazione.” Tretti was involved as one of the statutory auditors of the company. The The basis of any restructuring and turnaround plan is the ability to reach an case involved a takeover of the company’s shareholding control by an agreement with the creditors to waive part of the credit amount or to convert international group of investors, as well as the delisting of the company it into equity – in particular with those creditors who are vital to the continufrom the ISE. 106 Corporate INTL September 2011

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Law That




Lorenz is an international law firm with offices in Brussels, Bishkek and Geneva. While it is privileged to be involved in high profile international projects, Lorenz endeavours to offer day-to-day solutions and addresses its clients’ legal needs in an efficient and businessorientated manner. Fortune 500 companies, investment funds but also start-ups and growth companies chose Lorenz as their legal advisor for daily counseling as well as highly specialised transactions.

We deal with • corporate transactions, including mergers and acquisitions • joint ventures • corporate restructuring • financing of aquisitions • private equity and venture capital

The corporate and M&A Department at Lorenz Brussels is headed by Steven De Schrijver.

• employment and regulatory aspects of corporate transactions We focus on

“Steven de Schrijver is extraordinarily responsive, thorough and intelligent”.

• inbound and outbound investements relating to Belgium • inbound and outbound investements relating to Asia

Legal 500 EMEA 2011

• transactions for technology-orientated companies

He acts quickly, understands the issues, is comfortable with the international aspects and always sees everything through to the last detail”.

As an independent law firm, Lorenz cooperates closely with law firms worldwide on international legal projects.

Chambers Global 2010


Regentlaan 37-40 Boulevard du Regént, B-1000 Brussels, Belgium T +32 2 239 20 00 | F +32 2 239 20 02

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GE Capital

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IAC Group Pan European Receivables Financing €125 million Structured Working Feb-11 Capital Facility


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Niagara LaSalle (UK) Ltd CID & Inventory £19 million Jan-11 Acquisition



Fogarty (Filled Products) Limited CID, Inventory, Trade Finance & Plant & Machinery £9.5 million Refinance Mar-11


Silverline Office Equipment Ltd CID £2 million Refinance Jan-11

Dawson International plc CID, Inventory & Trade Finance £11 million Refinance Mar-11

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From refinancing and restructuring to buy-outs and acquisitions, whether a small domestic transaction or a large structured cross border transaction, we can help you unlock the funding potential in your assets. To see how GE Capital's ABL expertise can help companies make the most of their opportunities, contact us on 0870 8500315 or visit

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