31 January 2013
Bankers warned on heart problems as young deaths reported – eFinancialCareers. Excerpt:
“One 40-something financial services employee who had a near-fatal heart attack last year, said it’s not so much banking that’s bad for your heart as cocaine. “A lot of people in banking take cocaine when they’re younger – it is incredibly corrosive for the heart. Even if you stop doing drugs as you get older, it just takes a bit of stress in your 40s and – bam.”
He adds that many people in the City of London have heart attacks and then go back to work as soon as possible. “It’s all part of the problem. I know three really senior guys who had serious heart attacks and were back at their desks within six weeks because they wanted to show how tough they were. You should really have three months off.””
See also: “…if you’re earning £1m a year, after tax that’s £500,000; after the amount that’s in stock that you can’t access for three years, that’s £300,000; and you’ve got to educate three kids privately. Bankers aren’t wealthy any more”
Posted in Financial services and market conduct |
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31 January 2013
The Financial Services Authority’s pilot findings on the mis-selling of interest rate hedging products, published today (document here, press release here), has an interesting short discussion of how the FSA determined whether a purchaser was “sophisticated”, at section 4 of the document.
Posted in Financial services and market conduct, UK government |
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31 January 2013
BIS press release of 30 January 2013 here. Excerpt:
“I do recognise that for some businesses, like those in the mining and extractives industry in particular, there are unique challenges in diversifying their boards with the right experience. The frequent travel and project based work in remote areas of the world have all been cited as barriers to appointing more women in the past. However, successful modern companies learn to adapt and survive and doing nothing is not an option anymore.”
See also: Women on boards: EU publishes draft directive on “improving the gender balance” among companies listed on regulated markets; sets 2020 target for 40% of NEDs to be women
Posted in Corporate governance, Directors, Equity capital markets, UK government |
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28 January 2013
Posted in M+A, Takeovers, United States |
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28 January 2013
The Upper Tribunal has confirmed the Financial Services Authority’s 2011 fine of £8 million on Swift Trade for market abuse. Our post on the FSA’s original 2011 action is here.
This is the largest fine ever imposed by the FSA for market manipulation (i.e. FSMA section 118(5)). The Tribunal’s decision is here.
From the FSA’s press release today:
“The Upper Tribunal (Tax and Chancery Chamber) has directed the Financial Services Authority (FSA) to fine Swift Trade, a non-FSA authorised Canadian company with global operations, £8m for market abuse. The Tribunal described this as being “as serious a case of market abuse of its kind as might be imagined”.
Between 1 January 2007 and 4 January 2008, Swift Trade engaged in a systematic and deliberate form of manipulative trading known as “layering”. The manipulative trading caused a succession of small price movements in a wide range of individual shares on the London Stock Exchange (LSE) from which Swift Trade made substantial profits.
The trading was widespread and repeated on many occasions involving tens of thousands of orders by many individual traders sometimes acting in concert with each other across many locations worldwide.
read more »
Posted in Financial services and market conduct, Regulators |
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28 January 2013
First use of enhanced cooperation procedure in area of taxation. Council of the European Union press release, 22 January 2013:
read more »
Posted in Europe, Financial services and market conduct, Tax |
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28 January 2013
The GC100 has responded to the final report of the Kay Review of UK Equity Markets and Long-Term Decision Making.
For the GC100′s response to various suggestions made in the Kay Review, see the following paragraphs of the GC100 document:
read more »
Posted in Companies Act 2006 and company law, Corporate governance, Directors, Equity capital markets, Lawyers, Lobby groups |
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28 January 2013
A useful article from Dechert, explaining what will happen to the section 397 Financial Services and Markets Act 2000 “misleading statements and practices” offence when the Financial Services Act 2012 comes into force in April 2013.
In short, the s397 offence will be replaced by three offences contained in section 89, 90 and 91 of the new Act – ‘misleading statements’ (section 89), ‘misleading impressions’ (section 90) and misleading statements and impressions in relation to benchmarks (section 91).
The Decert article also discusses the FCA’s powers to ban misleading financial promotions.
See also: Section 397 FSMA to be amended in LIBOR reforms
Posted in Financial services and market conduct, UK government |
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25 January 2013
Mary Jo White, presently a partner at Debevoise and Plimpton, is to be nominated by President Obama to head up the US’s lead securities regulator. Here is Bloomberg’s take on the appointment, the New Yorker’s, and the Economist’s.
Posted in Financial services and market conduct, Lawyers, Regulators, United States |
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24 January 2013
From a Federal Financial Institutions Examination Council press release dated 22 January 2013:
“The (FFIEC) today released proposed guidance on the applicability of consumer protection and compliance laws, regulations, and policies to activities conducted via social media by banks, savings associations, and credit unions, as well as nonbank entities supervised by the Consumer Financial Protection Bureau and state regulators.
The FFIEC is responding to requests for guidance in this area from various industry and consumer interests. The guidance is intended to help financial institutions understand potential consumer compliance, legal, reputation, and operational risks associated with the use of social media, along with expectations for managing those risks. Although the guidance does not impose additional obligations on financial institutions, the FFIEC expects financial institutions to take steps to manage potential risks associated with social media, as they would with any new process or product channel.”
The guidance is here.
Posted in Financial services and market conduct, Regulators, United States |
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24 January 2013
Err, right…From a BIS press release today:
“A government sponsored business study published today has found that employee satisfaction and commitment to their place of work has significantly increased despite the economic downturn.
The 2011 Workplace Employment Relations Study (WERS), which was last run in 2004, explores the current state of workplace relations and covers a wide range of issues such as the relationship between employer and employee, work life balance, equality and diversity, training, pay and working hours.
Report highlights include:
• Job satisfaction levels increased. 20% of employees in 2011 were satisfied or very satisfied with all aspects of their job measured, compared to 16% in 2004;
• Since 2004 employees’ levels of commitment to the organisation in which they work increased. The largest rise was in the percentage of employees who said they shared the values of their organisation, up from 55% in 2004 to 65% in 2011;
• Managers are communicating more with employees. Managers are now more likely to hold team briefings to keep staff informed about changes at work (up from 60% to 66%) and they are more likely to provide employees with more information on workplace finances (up from 55% to 61%);
• The proportion of employees with high levels of autonomy increased between 2004 and 2011. The most common areas of discretion are how employees do their job (52%) and the order in which they carry out tasks (51%); and
• The percentage of high training workplaces (where at least 80% of experienced employees had some off-the-job training) rose from 35% to 41%.”
See also: Geoff Dyer on work
Posted in Scrapbook |
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24 January 2013
Cambridge researchers find way to use DNA to store digital data:
“Researchers at the EMBL-European Bioinformatics Institute (EMBL-EBI) have created a way to store data in the form of DNA – a material that lasts for tens of thousands of years. The new method, published today in the journal Nature (“Towards practical, high-capacity, low-maintenance information storage in synthesized DNA”), makes it possible to store at least 100 million hours of high-definition video in about a cup of DNA.”
More here (Nanowerk).
Posted in Scrapbook |
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22 January 2013
“The story goes that someone once remarked of Morrison that he was his own worst enemy, and Bevin immediately butted in to say “Not while I’m alive, he ain’t”.”
Pace Bevin, private equity is not short of enemies; but as this write-up (“Private equity bans the press“) of a conference today at the LSE by Dan Dunkley of PE News shows, sometimes the industry doesn’t help itself.
The BVCA commented on 25 January 2013:
“This week the London School of Economics held its annual Alternative Investments Conference, an event at which the press were excluded from some sessions. At the time of writing that has been reported by both Private Equity News and City AM. Whilst not all sessions were subject to a media ban, and others appear to have been implemented through over-zealous policing by the organisers, the fact that some were sends out a damning signal, presenting the industry in the worst possible light and opening us up once again to charges of secrecy. In this post-financial crisis world when accountability and transparency have rightly risen to the top of the corporate agenda, banning the press from public events can do nothing but harm the reputation of private equity and derail all the good progress we have made in the last five years.”
Posted in Private equity |
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21 January 2013
The FT editor’s e-mail to staff, via The Guardian:
read more »
Posted in Scrapbook |
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21 January 2013
Published today. From the abstract:
“We examine the determinants of successful exits in European venture capital transactions and compare them to US transactions. Using survival analysis, we show that for both regions the probability of exit via an initial public offering (IPO) has gone down significantly over the last decade, while the time to IPO has gone up – in contrast, the probability of exit via trade sales and the average time to trade sales do not change much over time. Contrary to perceived wisdom, there is no difference in the success rates of European and US deals from the same vintage year with respect to IPO exits, while Europe has about an eight percentage point lower probability of exit via trade sales than the US. Venture success has the same determinants in both Europe and US, with more experienced entrepreneurs and venture capitalists being associated with higher probabilities of exit. The fact that repeat or ‘serial’ entrepreneurs are less common in Europe and that European VCs lag US VCs in terms of experience explains the remaining difference in performance. Finally, and contrary to perceived wisdom, we find no evidence of a stigma of failure for entrepreneurs in Europe.”
Posted in Europe, Lobby groups, Private equity |
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21 January 2013
The FT has lunch with Sydney Kentridge:
“Sir Sydney, who started his career as a lawyer in South Africa in 1949, marked his 90th birthday in November by representing the Law Society in a constitutional case in front of the UK Supreme Court.
The fact that he is still on his feet after six decades is, however, only one reason for his eminence. He has represented three Nobel Prize winners in court – Nelson Mandela, Desmond Tutu and Chief Albert Luthuli. At the inquest in 1977 for Steve Biko, the South African anti-apartheid activist who was beaten to death by police, he appeared for Biko’s family…
…I press him to explain why he values the rule of law so highly…he starts a lengthy, intricate disquisition on the roots of constitutional law. He concludes with a story about the arrest of a Russian ambassador in the reign of Queen Anne, which so upset the Tsar of Russia that he wrote, demanding that those responsible be executed.
“Queen Anne sent a wonderful reply, saying the Tsar must understand that she has no power to put even the lowliest citizen to death, save by the operation of the law, and she trusts that the Tsar will not compel her to impossibilities.” He places an elbow on the table and slowly wags a long forefinger at me in epiphany. “That’s the rule of law.”
Posted in Lawyers |
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21 January 2013
Part 25 of the Companies Act 2006, Company charges, will be amended on 6 April 2013. The latest draft of the amending Regulations is here. Companies House have produced an explanation of the intent and effect of the proposed amendments, which is here. Excerpt:
“The aims of the new provisions are to:
- streamline procedures and reduce costs for those putting information on the public record, in particular by enabling electronic filing
- reduce uncertainty as to what charges must be registered
- replace two current schemes which depend on the company’s place of registration with a single scheme for all UK-registered companies
- improve the quality of information about security given by companies
- improve access to the instruments creating companies’ charges
The primary purpose of the draft regulations is to give effect to the Department’s policy of providing for a single scheme for registration, satisfaction or alteration of company charges irrespective of the place of incorporation of the company (as in current Part 25 of the Act). The changes will also be applied, with minor modifications, to limited liability partnerships by a separate statutory instrument.”
As stated above, the changes also apply to LLPs.
Posted in Companies Act 2006 and company law, UK government |
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21 January 2013
The Law Society published a letter on 16 January 2013 setting out its opposition to the Government’s plans for a new employment status – the “employee shareholder” (see this post for the Government’s most recent statement on its plans).
In its letter, the Law Society says:
read more »
Posted in Companies Act 2006 and company law, Lawyers, Lobby groups, UK government |
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21 January 2013
In 18 January 2013 ICSA published a guidance note on ”Liability of non-executive directors: care, skill and diligence“. From the accompanying press release:
“The latest ICSA guidance note suggests ways in which NEDs can approach their work which would also allow them to demonstrate to a regulator, or in a court of law, that they had executed all necessary steps to reduce their liability exposure.
read more »
Posted in Companies Act 2006 and company law, Corporate governance, Directors, Equity capital markets, Lobby groups, Risk management |
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21 January 2013
The snappily-named Listing Rules Joint Working Party of the Company Law Committees of the Law Society of England and Wales and the City of London Law Society has published its response to the FSA’s October 2012 consultation on “Enhancing the effectiveness of the Listing Regime” (we discussed the consultation in this post).
See also: A new route to the UK IPO market: Government plans to relax rules to attract high-growth companies to list on London
Posted in Consultations, Corporate governance, Directors, Equity capital markets, Lawyers |
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21 January 2013
Posted in Lawyers |
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15 January 2013
A thought-provoking infographic on Internet use and Internet addiction here.
See also: The Shallows: what the Internet is doing to our brains – Nicholas Carr
Posted in Scrapbook |
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11 January 2013
The BARCO escrow service for barristers has been approved by the Financial Services Authority; this will facilitate greater direct instruction of barristers by clients i.e. without an intermediating solicitor.
BARCO sub-site of the Bar Council here; background from The Times here.
Posted in Lawyers |
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11 January 2013
HM Treasury today announced a consultation on “key policy decisions” for the transposition of the Alternative Investment Fund Managers Directive into UK law. The consultation document is here. From the press release:
read more »
Posted in Consultations, Europe, Financial services and market conduct, Private equity, UK government |
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11 January 2013
Following bribery allegations, Rolls-Royce has appointed Lord Gold to review its compliance procedures. From the RNS:
“This follows the previous announcement by Rolls-Royce that it has provided information to the Serious Fraud Office (SFO) relating to concerns about bribery and corruption involving intermediaries in overseas markets.”
Lord Woolf performed a similar function for BAE Systems in 2007-8.
Posted in Risk management |
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11 January 2013
Posted in Equity capital markets, United States |
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9 January 2013
Posted in Private equity, United States |
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9 January 2013
The European Commission today published its “Entrepreneurship Action Plan” aimed at – in the Commission’s words – ”reigniting the entrepreneurial spirit in Europe”. The full Plan is here and the press release here.
The braod areas addressed by the Plan are:
- Entrepreneurial education and training to support growth and business creation.
- Creating an entrepreneurial environment:
- Access to finance
- Digital business
- Transfer of businesses
- Bankruptcy procedures
- Regulatory burden reduction
- Role models and reaching out to different groups.
All quotations below are taken from the full Plan document.
Access to finance – a new EU capital market for SMEs:
read more »
Posted in Equity capital markets, Europe, M+A |
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8 January 2013
A lengthy NYT article discusses the rise of crowdfunding and peer-to-peer lending in the United States, and the delay in writing new rules required under the JOBS Act as the SEC struggles to balance encouraging these new financing models with investor protection.
See also: Lots more crowdfunding posts.
Posted in Financial services and market conduct, Regulators, United States |
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8 January 2013
Bonfire of the Vanities author in the Daily Beast on the demise of traders and the rise of quants, via the Facebook IPO:
“But it proved to be more than one unbelievably bollocksed-up IPO. May 17 was the day Wall Street got vaporized. After Facebook Day, all that “Wall Street” had been a metonymy for, the big money, the Big Picture of America’s economy, the excitement, the sense that this is where things are happening, was gone”
and John Coates’ work on the physiology of trading floors.
Posted in Scrapbook |
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7 January 2013
The Listing Rules sponsor regime was tightened on 31 December 2012, with more responsibilities being placed on sponsors and the occasions on which a sponsor must be appointed being expanded. The changes are summarised in this note by Cameron McKenna; changes to the Listing Rules chapter 8 are here.
Posted in Equity capital markets, Regulators |
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4 January 2013
The Court of Appeal in a judgment delivered on 26 October 2012 has confirmed the primacy of the corporate law principles on piercing the corporate veil, over family law principles on entitlement to assets. The majority decision relies heavily on Salomon v A Salomon.
Times Law Report here. Excerpt:
“The separate corporate identity of a company was a fact of legal life which all courts were required to recognise and respect, whatever jurisdiction they were exercising. It was not open to a court, simply because it regarded it as just and convenient, to disregard such separate identity and to appropriate the assets of a company in satisfaction either of the monetary claims of its corporator’s creditors or of the monetary ancillary relief claims of its corporator’s spouse.”
See also: Piercing the corporate veil: VTB Capital v Nutritek International
Posted in Regulators |
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4 January 2013
A concert party exists, aggregate voting interests of the party must be reduced to less than 30% by disposal, and pending disposal voting rights must be restricted to 29.9% of all rights exercisable.
Panel Executive ruling of 19 December 2012 here.
Posted in Takeovers |
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4 January 2013
The European Securities and Markets Authority launched two AIFMD-related consultations on 19 December 2012:
From the press release:
“The European Securities and Markets Authority (ESMA) has launched a consultation on Guidelines on key concepts of the Alternative Investment Fund Managers Directive (AIFMD). The Directive provides the legal framework for both alternative investment funds (AIFs) and their managers (AIFMs).
ESMA’s draft guidelines are aimed at clarifying the rules applicable to hedge funds, private equity and real estate funds. These proposals help to clarify what entities fall under the remit of the AIFMD, thereby creating a level-playing-field by providing for consistent application of the provisions throughout the EU. In order to achieve this, the guidelines set out the criteria for what is considered to be:
• a collective investment undertaking;
• capital raising;
• defined investment policy; and
• the number of necessary investors.
The draft Guidelines will contribute to the creation of a level playing field in the area of AIFs.
Draft Technical Standards on Types of AIFMs
ESMA has also issued a consultation on Draft regulatory technical standards on types of AIFMs, which are aimed at ensuring the uniform application of the AIFMD across the EU. These standards distinguish between managers of AIFs whose investors have the right to redeem their shares at least annually (open-ended AIFs), and those whose investors have less frequent redemption rights.
Both papers follow an earlier discussion paper published by ESMA in February. For some of the issues covered in that paper, which are not addressed in the consultations published today, ESMA will take into account the Commission’s Level 2 implementing measures before deciding on the appropriate next steps.
The closing date for responses to these consultations is 1 February 2013. The Guidelines and Technical Standards will be finalised in the first half of 2013.”
See also: AIFMD: European Commission adopts Delegated Regulation
Posted in Consultations, Europe, Financial services and market conduct, Private equity, Regulators |
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4 January 2013
The Commission on 19 December 2012 adopted nine regulatory and implementing technical standards to complement the obligations defined under the Regulation on OTC derivatives, central counterparties (CCPs) and trade.
The technical standards are here.
More EMIR here.
Posted in Europe, Financial services and market conduct |
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4 January 2013
The Financial Reporting Council published on 19 December 2012 its annual report monitoring developments in corporate governance. The report is here and the accompanying press release is here.
From the press release:
“The Stewardship Code has been a catalyst for greater engagement between companies and their shareholders in 2012. Introduced in 2010, there are now over 250 signatories to the Code, including most major institutional investors.
This is one of the conclusions in the Financial Reporting Council’s annual report on its monitoring of developments in corporate governance, published today.
The FRC also found strong take-up by companies of the recommendations introduced to the UK Corporate Governance Code in 2010. Ninety-six per cent of FTSE 350 companies now put all directors up for re-election every year, and the majority of those companies will have the effectiveness of their board independently reviewed at least every three years. Overall compliance with the Code among listed companies of all sizes remains high.”
From the Introduction to the report:
read more »
Posted in Corporate governance, Equity capital markets, Regulators |
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3 January 2013
Here.
Bank of England sub-site on “Preparing for the PRA” here.
Posted in Financial services and market conduct, Regulators |
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3 January 2013
The Financial Services Authority published on 20 December 2012 a consultation paper (CP12/39) on the Prudential Regulation Authority’s approach to its proposed statutory enforcement policies and procedures. Press release here and CP here.
The consultation closes on 28 February 2013.
Posted in Consultations, Financial services and market conduct, Regulators |
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