A NOTEPAD ON COMPANY AND FINANCIAL LAW, NEWS AND REGULATION
“The SFO Director David Green QC has today decided formally to accept the LIBOR matter for investigation” – Serious Fraud Office statement today.
See also: SFO drops disastrous investigation into Vincent Tchenguiz; never got into Annabel’s
The Serious Fraud Office’s whistleblowing service
“I love Barclays, and I am proud of all of you”: Bob Diamond letter to staff
The Code Committee of the Takeover Panel has today issued three consultation papers:
1. Profit forecasts, quantified financial benefits statements, material changes in information and other changes to the Code, PCP2012/1 – amendments to Code provisions.
2. Pension scheme trustee issues, PCP 2012/2 – proposing to extend the provisions of the Code which apply to employee representatives to apply also to the trustees of the offeree company’s pension schemes.
3. Companies subject to the Takeover Code, PCP 2012/3 – proposing to remove the “residency test” for whether the Code applies to an offer.
The consultations close on 28 September 2012.
The Times reports today (here, paywall) that:
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The review by Graeme Nuttall of employee ownership has been published today by the Department of Business, Innovation and Science. The review makes 28 detailed recommendations aimed at introducing “the concept of employee ownership into the mainstream British economy” – a Coalition policy aim announced by the Deputy Prime Minister in January 2012, as we covered here.
The most eye-catching recommendation is that the Government should consider a “Right to Request employee ownership”, by the development of a voluntary code setting out best practice on requesting and agreeing employee ownership in a company, and by issuing a call for evidence on the introduction of a “statutory Right to Request consideration of an employee ownership proposal”. (Recommendations K and L.)
The review document is here and the accompanying BIS press release is here.
Key recommendations
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In Geltl v Daimler AG the European Court of Justice ruled on 28 June 2012 on an important case for the interpretation of the UK market abuse regime. The ECJ ruling emphasises that very careful thought is required when determining at what point in an ongoing process information becomes “inside information” and potentially announceable to the market.
The UK market abuse regime is contained in Part VIII of the Financial Services and Markets Act 2000, and in its current form reflects two EU directives (2003/6 and 2003/124). The ECJ judgment is here and the accompanying press release is here.
Mr Geltl’s case
The case arose from the sale of shares by Mr Geltl, a Daimler shareholder.
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The preliminary F-1 Registration Statement is here for the IPO of “Manchester United Ltd.” on the New York Stock Exchange.
Remarkably, the club qualifies as an “emerging growth company” under the US Jumpstart our Business Startups Act of 2012. From the F-1:
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Prompted by the failure of the Royal Bank of Scotland and in the spirit of Barclays travails, HM Treasury today launched a consultation on possible sanctions for directors of failed banks. The consultation document is here and the accompanying Treasury press release is here.
The two principal measures suggested in the consultation document are:
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Last week we highlighted the 27 page analysis of specific “problems and anomalies” contained in the Companies Act 2006 that was compiled by the Company Law Committee of the City of London Law Society and the Law Society Company Law Committee.
The British Venture Capital Association has prepared a futher gloss on that analysis and submitted it to the Government’s “Red Tape Challenge” on company law. The BVCA submission can be read here.
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Marcus Agius back as Chairman. Announcement here.
Mr Diamond said in the announcement: “We…added our own distinctive chapter to the long and proud history of Barclays”.
UPDATE 3 July 2012: Barclays submission to the Treasury Select Committee is here. The part of interest is the file note by Bob Diamond, in which he recorded on 29 October 2008 that Paul Tucker, Deputy Governor of the Bank of England, had that day told him that “it did not always need to be the case that we [i.e. Barclays LIBOR submissions] appeared as high as we have recently”.
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With insufficient resources to recruit professional staff, the National Archives plans to use trained volunteers to update legislation at legislation.gov.uk. More in this article from the Law Society Gazette.
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In his statement this afternoon on LIBOR, the Chancellor of the Exchequer announced a plethora of inquiries and reviews:
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Bob Diamond has written to all Barclays staff about the LIBOR scandal and the resignation of the bank’s chairman. The most interesting part of the letter concerns the failures of Barclays risk management:
“The events revealed last week arose in large part because we did not have appropriate controls in place. Frankly, we misjudged the risk associated with the underlying activity. That must never happen again. Once we better understood the risks, we put in place the right controls and systems.”
Mr Diamond doesn’t address the question that is likely to preoccupy the Treasury Select Committee on Wednesday: to what extent did he know about the incorrect LIBOR submissions at the time they were made?
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The chairman of Barclays, Marcus Agius, has resigned following the LIBOR scandal. Mr Agius said in the bank’s statement:
“…last week’s events – evidencing as they do unacceptable standards of behaviour within the bank – have dealt a devastating blow to Barclays reputation. As Chairman, I am the ultimate guardian of the bank’s reputation. Accordingly, the buck stops with me and I must acknowledge responsibility by standing aside”.
The bank has started an independent review of its business practices:
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