London’s Southwark Crown Court recently approved only the second Deferred Prosecution Agreement (DPA) since the introduction of DPAs in 2014. Herbert Smith Freehills' London Corporate Crime and Investigations team negotiated the first DPA with the SFO, which was concluded in November 2015. The recent announcement of the UK’s second DPA indicates that DPAs are likely to be an important tool in the SFO’s armoury as it pursues corporates alleged to have committed economic or financial crimes.
Suspicious transaction and order reporting
Under Article 16 of MAR, market operators and investment firms operating a trading venue1, and any person professionally arranging or executing transactions, should have in place arrangements, procedures and systems for the detection and reporting of orders and transactions suspected of constituting insider dealing, market manipulation or attempted insider dealing or market manipulation. The obligations to detect and report market abuse are not limited to investment firms under MiFID; they extend to UCITS management companies, AIF managers and other firms professionally engaged in trading on own account (proprietary traders) such as energy trading companies. Continue reading
The High Court has ordered disclosure to be carried out using predictive coding despite a party's objections to the use of the technology: Brown v BCA Trading Limited  EWHC 1464 (Ch).
On 1 July, the Council of the EU announced that its sectoral sanctions against Russia (which were previously due to expire on 31 July 2016) will be extended for a further six months until 31 January 2017. This extension was effected by Council Decision (CFSP) 2016/1071 of 1 July 2016 (the "Decision"), amending Council Decision 2014/512/CFSP. The Decision came into force upon publication in the Official Journal on 2 July 2016. For further detail on the sectoral sanctions currently in force, please see our previous briefings here and here.
On 3 July 2016, the EU Market Abuse Regulation (MAR) (EU 596/2014) replaced the Market Abuse Directive (MAD) and the current UK regimes for market abuse and inside information. To help guide you through the first six months under the new regime, we will be issuing fortnightly "bitesize" updates providing concise snapshots of a number of key practical areas of interest under MAR. This first "bitesize" update on MAR focuses on the impact that MAR will have on listed companies' decisions to delay the disclosure of inside information in the UK. Continue reading
The Hong Kong Stock Exchange (the “Stock Exchange”) and the Securities and Futures Commission (“SFC”) have jointly announced proposals to revamp the regulatory structure for making decisions in listing related matters. New committees, with equal representation by both the Stock Exchange and SFC, have been proposed with mandates to determine listing policy and to oversee decisions on listing matters which raise suitability concerns or have broader policy implications.
In a press release published on 15 June 2016 (available here), the International Court of Justice ("ICJ") announced that Iran has instituted proceedings against the USA, in respect of alleged violations under the 1955 US-Iran Treaty of Amity, Economic Relations and Consular Rights (the "Treaty").
Notably, Iran's application concerns allegations that the US, through measures taken under its national law, has subjected assets and interests of Iran and Iranian entities, including the Iranian Central Bank ("Bank Markazi"), to enforcement in the US in violation of immunities and other principles of international law that are upheld under the Treaty.
This case is likely to put the spotlight on the legality of the wide-ranging unilateral sanctions measures that have been and continue to be imposed by the US against Iran, notwithstanding the recent relaxation in January 2016 (see our previous blog post here), as well as questions of extra-territoriality and immunity under international law more generally. Our public international law team provide further details and comment on the case below.
Material adverse change (MAC) clauses aim to give buyers a right to withdraw from M&A deals on the occurrence of certain events that are detrimental to the target company. While MAC clauses have been a standard feature of US M&A agreements for many years, private acquisition agreements in the UK have not traditionally included MAC clauses. In recent years, however, there has been an increase in the number of buyers requesting the inclusion of MAC clauses in UK private M&A deals.
Neil Blake and Caroline Rae have published an article in the June edition of PLC Magazine in which they consider the use of MAC clauses in public and private deals in the UK, including recent case law interpreting such clauses and practical points for buyers when drafting them. Click here to download a copy.
A recent Hong Kong judgment highlights the importance of ensuring due process when regulators exchange information with each other.
In the UK a statement made to an investigator appointed by the FCA or PRA in compliance with an information requirement can be used in most enforcement proceedings within the UK. However under section 174 of the Financial Services and Markets Act 2000 (FSMA) a compelled statement cannot be used against the maker of the statement in most criminal proceedings or in proceedings in respect of market abuse. The only criminal proceedings in which the compelled statement may be relied upon is where it is alleged that the compelled statement was untrue.