AFME & Clifford Chance publish FAQs to assist bank clients address contractual questions

AFME, together with Clifford Chance, has today published guidance to assist bank clients in understanding how their cross-border relationships may be impacted by banks’ plans to adapt to Brexit.

The FAQs explain the potential significant impact on contractual relationships for financial services, providing answers to a number of “Frequently Asked Questions” which highlight potential operational and documentation impacts. As banks begin implementing their Brexit contingency plans, clients are likely to see impacts in respect of existing cross-border contracts and will be required to put in place arrangements for new business following Brexit.

The FAQs address questions such as which clients may be in scope, which contracts may be affected, how they may be impacted and consequential operational impacts that need to be considered.

Simon Lewis, Chief Executive of AFME said: “With the Brexit political process still ongoing, our FAQs document highlights the need for clients to take action now by reviewing documentation and operations to understand how they might be impacted, including whether operations may need to change. This is to ensure that clients have sufficient lead time to address documentation, technical and other issues for minimal business disruption. In this respect, AFME continues to call for clarity that clients will be able to rely on services under existing contracts post-Brexit.”

Monica Sah, Partner at Clifford Chance, said: “Six months ago nobody was talking about repapering. Now people realise that moving contracts from one jurisdiction to another is likely to be a significant undertaking as banks adapt to Brexit. These FAQs attempt to simplify a hugely complex process and help clients understand how their day to day contractual activities will be impacted by their dealers’ implementation of their own Brexit strategies. Clients need to work with their dealers to ensure a smooth transition and a continued seamless service.”

The FAQs primarily focus on questions relevant to EU27 clients of UK-based banks in relation to sales and trading in wholesale markets and related credit given for settlement purposes. The FAQs also highlight questions for UK-based clients of EU27-based banks, and primary market and financial market infrastructure impacts.

The FAQs are available in EnglishFrenchGermanItalian and Spanish.

Deutsche Börse – Crypto asset dojo 2018

If your daily activities include any of the following: creative thinking, coding, designing, hardware tinkering and lots of coffee, this one is for you! Deutsche Börse invites you to think about new, innovative financial services business applications. Deutsche Börse’s upcoming dojo is all about crypto assets – or, to be more specific, about Ether, bitcoin, […]

Primärmarktkonferenz 2018 des Deutschen Aktieninstituts. Im Bild Christoph Heuer, Head of Equity Capital Markets Goldman Sachs International

IPOs in the crosshairs: reflecting on Deutsches Aktieninstitut‘s Primary Market Conference 2018

2018 should be the strongest year for IPOs in a long time. Thus, the Deutsches Aktieninstitut focused its primary market conference on current questions and developments regarding the topic of initial public offerings. On January 30, at the Steigenberger Frankfurter Hof near Willy-Brandt-Platz, 60 attendants from companies, banks, legal firms and consultancies met for an extensive exchange on the matter.

The spectrum of topics ranged from the new prospectus regulation (ProspektVO), which comes into effect in June 2019 in the European Union (EU), to experience reports from VARTA and Uniper. During the boom years in the late 90s, mainly young startups with new business models came onto the stock markets, nowadays spin-offs, well-established companies or at least proven business models mark the IPO scene.

For these, the rather dry appearing KGaA legal form can serve as a bespoke solution – especially if the old shareholders want to stay in control. An example for an upcoming initial public offering of a GmbH & Co. KGaA is the DWS (Deutsche Asset Management) with Deutsche Bank as limited partner. Through a so-called Joint Committee, the Supervisory Board should have a greater say than usually common in a KGaA. This shows the flexibility of the arrangement of the KGaA system.

Slightly out of focus is the listing of German companies in the USA. In the 90s, German issuers listed peaked at around 30. However, after the Sarbanes-Oxley Act of 2002, more than two-thirds of them delisted and deregistered.

Since 2012, the Jumpstart Our Business Startups Act (JOBS Act) made listing on the US stock markets more attractive, especially for small business with annual turnovers of no more than 1,07 billion USD. German companies who are considering this, should note the following three aspects: 1) The coordination of reliable time tables with BaFin is possible, which is not always a given with the SEC. 2) financial statements need to be submitted in the USA after the US GAAP or the original IFRS, not in the EU version. 3) Essential contracts must be attached with the registration statement. For this reason, trivago had to translate and publish the rental agreement of its new headquarters in Düsseldorf. Whichever proposals the European legislators could extract from the JOBS Act, remained inconclusive at the conference. The listing in the USA offers a solution for companies with very specific conditions.

by Charlotte Brigitte Looß

“Mr. Financial Centre turns 75”

If Lutz Raettig did not exist, Frankfurt would have to invent him. The financial centre on the Main and the financial centre initiative Frankfurt Main Finance owe much to Lutz Raettig. Since 2005, he has been Chairman of the Supervisory Board of Morgan Stanley Bank AG in Frankfurt. From 1995 to 2005, he served as Morgan Stanley Bank AG’s Chief Executive Officer. Read more