On 24 December 2020, after roller-coaster negotiations, the United Kingdom and the European Union announced they had agreed a post-Brexit "EU-UK Trade and Cooperation" Agreement.
As part of his campaign to be elected as President of the United States, Joe Biden set out an ambitious climate plan which, among other things, calls for a goal of net-zero emissions in the U.S. by 2050 and actively combating climate change. This publication outlines the implications of the Climate Plan for the U.S. and the international community under the new Biden-Harris Administration.
On 31 December 2020, at the end of the Brexit transition period, UK firms will lose the passporting rights on which they currently rely to provide financial services in other EU jurisdictions. Instead, UK firms will need to consider the rules of each EU Member State to determine whether, and the extent to which, they will be able to continue providing services to clients in that jurisdiction.
True Brexit is nearly upon us, with the end of the transition period on 31 December 2020. What will this mean for the law and jurisdiction clauses in international contracts entered into after that date? In most cases, no fundamental change will be required, but the UK’s accession to the Hague Convention on Choice of Court Agreements may make exclusive jurisdiction provisions more attractive for some parties.
ISDA's IBOR Fallbacks Supplement and Protocol have been finalised and will be released on 23 October 2020. The Supplement, when it becomes effective on 25 January 2021, will implement risk-free rate fallbacks into the terms of new transactions and the Protocol will enable adhering parties to implement these fallbacks into the terms of legacy transactions. The broad scope of the amendments made by the Protocol, the range of agreements it covers and the availability of a series of templates and amendment agreements which can be used to tailor the terms of adherence, confront parties contemplating adherence with a series of major challenges.
Security token offerings, the issuance of digital tokens using blockchain or distributed ledger technology, are increasingly being seen as an alternative to mainstream debt and equity fundraisings. An evolution of the (supposedly) unregulated initial coin offerings or ICOs, security token offerings or STOs are typically structured to sit within securities law frameworks. This means much greater certainty for both fundraisers and investors, resulting in enhanced liquidity. In this report we consider how STOs are structured and some of the benefits and challenges, and explore the evolving regulatory landscape for STOs across Europe.
The payments landscape is changing rapidly. Central bank digital currencies (or CBDCs) and stablecoins have received growing attention, particularly around Facebook’s announcement of its proposed global stablecoin “Libra” in 2019 and the resulting regulatory backlash. Advocates hail them as the future for payments - an unmatched tool for financial inclusion and limiting financial crime, by linking payments to identity - while critics have concerns around regulatory standards and financial stability (in the case of global stablecoins) and whether the improvements are as impressive or distinct as supporters argue.
In the UK, regulators and the Sterling Risk Free Rate Working Group have long been urging loan market participants to transition away from using LIBOR on transactions. Whilst, to date, such transition has been challenging for the loan markets, recent publications such as conventions for the use of SONIA in the loan markets and the LMA's Rate Switch Agreement, will help to generate impetus for transition.
The discontinuation of LIBOR as an interest rate benchmark raises a number of issues for Islamic finance transactions. This briefing looks at the challenges ahead and outlines some of the potential solutions.
As of 1 January 2021, the UK Global Tariff (UKGT) will apply at the UK border to goods imported from countries with which the UK does not have a preferential trade agreement. This includes goods from major economies such as China and the US
The UK Department for International Trade (DIT) has unveiled its negotiating objectives for securing a free trade agreement with Japan. The DIT highlights textiles, agriculture, services and data exchange as key areas of focus.
In collaboration with Forbes Insights, we surveyed 300 senior c-suite executives from $1 billion+ companies on their hopes and fears for tech-driven growth*. Respondents were asked about their approach and attitude to artificial intelligence, ethics, adoption of new technologies, tech regulation, data, the impact of tech on jobs and tech expertise in their boardrooms. Their answers, together with in-depth perspective from interviews with global business leaders and our Tech Group experts can be found here.
With 2020 set to be a critical year for LIBOR transition, the infrastructure market will face some significant challenges as it transitions towards the use of risk-free rates (RFRs). We look at some of those challenges and the steps market participants should be taking now to ensure a smooth transition before the end of 2021.
Five stand out trends for Fintech in 2020
The European Parliament confirmed the new class of European Commissioners with 461 votes in favour, 157 against and 89 abstentions on 27 November 2019. The new President of the European Commission, Ursula von der Leyen, and her team of European Commissioners took office on 1 December 2019 and will drive the EU’s agenda for the next five years. Ms von der Leyen, the former German defence minister, says that it will be a “geopolitical Commission,” signalling an intention to position Europe as a heavyweight on the world stage.
This publication considers the LMA documentation and some of the other issues relating to transition in the loan market.
Financial institutions are focusing on market access in preparation for Brexit, but with the rise of deglobalisation, there is also a broader global trend towards limiting cross-border market access and tightening barriers.
What can investors who are pressing ahead with expanding their UK property portfolios or commencing developments do to Brexit-proof their commercial leases and prelet agreements for lease? The laws governing these types of agreement in the UK will not change as a result of Brexit, and (thankfully) we know from the recent Canary Wharf v EMA case that Brexit is unlikely to result in frustration of these agreements. But with continuing uncertainty around potential disruption to supply chains, currency fluctuations, and labour shortages as a result of Brexit, there are still some steps that prudent landlords and developers can take now to avoid the worst of any adverse consequences that could flow from a chaotic Brexit.
With protectionism and deglobalisation on the rise in Europe, the US and elsewhere, China, by contrast, is championing globalisation. Its financial system is still relatively closed to international access, but the Chinese government has recently taken steps to open up access to its financial markets to foreign investors, in order to seek global capital. Although it remains at a relatively early stage, legislative changes such as the new Foreign Investment Law and links to the global financial system including Shanghai-Hong Kong Stock Connect are already having an impact and China’s influence in global financial markets may grow significantly if this trend continues.
Clifford Chance experts discuss these competing forces towards and against globalisation, focusing on five areas that are driving or challenging global approaches in financial regulation.
Clifford Chance experts assess the changing regulatory landscape as the Chinese government puts quality and affordability at the centre of its healthcare policy agenda.
In July, when campaigning to lead the Conservative Party, Prime Minister Boris Johnson promised party members that he would "roll back the influence of the state" by changing public procurement rules in order to favour UK companies when bidding for billions of pounds worth of Government work and turbo-charge the advantages of the UK economy. Here we look at how such a "buy British" pledge might be implemented, the effect it may have on British companies bidding for contracts outside the UK under WTO terms and the implications that such a policy might have on the UK agreeing Free Trade Agreements.
This briefing considers the challenges for Libra in the face of the financial crime concerns that have been raised since its announcement.
Clifford Chance experts, including of Counsel Michel Petite who worked for the EU for 27 years and was legal adviser to three Commission Presidents, assess the priorities for the new von der Leyen Commission.
Parliament might have thought it was prorogued but, if so, Parliament was wrong according to the Supreme Court. Parliament has now resumed its sittings. But what impact the Supreme Court's decision will have on Brexit is more speculative.
This briefing looks at how blockchain explorer software can assist financial institutions and crypto-businesses meet their own anti‑money laundering (AML) and sanctions obligations.
Clifford Chance experts consider the potential challenges, what this means for the tech sector and whether more could be done.
This briefing examines some of the key questions around crypto-funds and the issues that can arise for fund managers in this emerging area.
Amidst a flurry of campaign promises, policy announcements and discussions of parliamentary procedure, Brexit continues to dominate the UK political agenda.
The essence of Libra is that Facebook hopes consumers across the world will spend money in a new cryptocurrency. Its value will track a basket of fiat currencies, meaning that the value of a Libra against a particular fiat currency will inevitably fluctuate. That creates a problem for consumers: each time they transact, they’ll be making a capital gain or loss. In most countries gains will be taxable, meaning consumers will have to file a detailed tax return showing all their transactions and the exchange rate at the time, and pay any tax due. This seems to us to be a significant barrier to wide adoption.
A new report by the UK Climate Change Committee has recommended that the UK toughens its climate target to net zero greenhouse gas emissions (GHG) by 2050.
Coal projects are under pressure from governments, courts, businesses and investors as the momentum to reduce the use of coal builds. This publication explores some of the action being taken by the public and private sectors and the impact on the industry.
This briefing considers insider dealing risk arising when big data constitutes inside information and the manipulation risk arising from AI and machine learning.
This article, which was first published by the International Financial Law Review, highlights the legal, ethical and reputational risk that UK financial institutions face when using AI and suggest the steps that they should take now to minimise them.
Clifford Chance experts take a bird’s eye view of fintech developments across EMEA and how regulators are responding.
Rate Expectations: Transitioning away from LIBOR – practical guidance for corporate treasurers (February 2019)
This publication explores the current state of LIBOR transition, what a move to risk-free rates will mean in practice for corporate treasurers, and some key steps that treasurers might take in the near term to ready themselves for LIBOR’s potential demise.
Israel, with its expertise in technology such as big data analytics, artificial intelligence, blockchain and computer vision, has established itself as a global centre for fintech.
This publication provides a snapshot of “risk-free reference rates” (RFRs) selected by different markets to replace LIBORs and IBORs for different currencies. It also highlights those RFRs for which “term” rates are being pursued and those for which Overnight Indexed Swaps (OIS) and futures have been developed.
This publication considers how conventions used in Overnight Index Swaps (OIS) and RFR futures markets are relevant to the development of RFR-based term rates.
This publication contains a review of the comparative product challenges for the loan, bond (including securitisation) and derivatives markets to assist with your review of financing arrangements as a whole.
China's Belt and Road Initiative (BRI), is one of the most ambitious development projects in history. The first phase focuses on much-needed infrastructure development but where is the money coming from and what are the challenges and opportunities?
Since its launch in 2013, the Belt and Road Initiative (BRI) has driven billions of dollars’ worth of ambitious infrastructure projects across nearly seventy countries. As the level and scope of outbound investment increases, Chinese companies are now giving careful thought to dispute resolution.
Standing at the crossroads between Asia and Europe, the Caspian region has a key part to play in China’s Belt and Road Initiative (BRI). The governments of Azerbaijan, Kazakhstan, Uzbekistan, Turkmenistan and Georgia, in particular, are actively courting Chinese investors and Chinese finance in relation to a range of domestic and cross-border transportation, energy and information infrastructure projects
When the Belt and Road Initiative (BRI) was first announced in 2013, no one in the private sector was really sure what it meant and what opportunities would become available. Now there is a much clearer picture and we are seeing a significant degree of interest in BRI-related financial commitments, investments and projects.
The profile of corporate sustainability has been growing steadily over the last few years. Boosted by initiatives such as the UN Global Compact and its Sustainable Development Goals and the Paris Climate Change Agreement, the topic is becoming a mainstream and core focus of business operations in many sectors.
Initial coin offerings or ICOs are growing rapidly. Essentially a method of crowdfunding facilitated through blockchain and cryptocurrency technologies, ICOs are reported to have raised almost $10 billion globally from the start of 2017 despite being denounced by some commentators as Ponzi schemes.
The energy sector is investing heavily in technology to drive efficiency, cut costs and better understand its customers. We outline the four trends that will have a significant impact on the industry and the legal risks to watch out for.
As every news cycle brings further revelations about the alleged misuse of personal data by social media companies and political consultants, regulators, politicians and the public are more concerned than ever with what happens to information placed online, who has it and how it is being used.
This publication looks at how blockchain helps trade finance transactions and the impact of economic sanctions on blockchain and trade finance.
In this report, we aim to show that the Middle East has great potential for future investment in fintech and that, despite challenges in the region, these are mitigated by significant development and modernisation happening across the region.
As the PRA and FCA launch their consultations on rule changes to reflect CRD V, pay and remuneration regulation continue to be areas of focus for financial services firms.
Security token offerings or STOs, the issuance of digital tokens using blockchain or distributed ledger technology, are increasingly being seen as an alternative to mainstream debt and equity fundraisings. An evolution of the (supposedly) unregulated initial coin offerings or ICOs, STOs are typically structured to sit within securities law frameworks. This means much greater certainty for both fundraisers and investors, resulting in enhanced liquidity.