UK listing regime reform: update on potential impact on securities litigation

The Financial Conduct Authority (FCA) has published a further consultation paper for the UK’s new listing regime (CP 23/31) which includes in draft (most of) the new UK Listing Rules, following stakeholder feedback to its initial consultation (CP 23/10) last May (see our previous blog post).

The FCA’s overarching philosophy is to shift to a disclosure-based regime (rather than shareholder votes or strict eligibility criteria) to encourage more companies to list in the UK. The changes proposed will result in a rebalancing of risk, with greater risk shifting to investors, which may impact future claims brought by shareholders under ss.90 and 90A of the Financial Services and Markets Act 2000 (FSMA).

For a more detailed analysis of the draft Listing Rules, please see this blog post by our Capital Markets team.

In summary, the FCA is implementing a new single listing category to replace the current premium and standard segments and proceeding with most of the proposals trialled in May last year, in particular: (1) removing the requirement for shareholder votes and circulars for Class 1 and related-party transactions; (2) requiring annual reporting on compliance with the governance code; and (3) modifying the sponsor regime. We consider the potential impact on securities litigation of each of these changes below.

Class 1 transaction notifications

The FCA has maintained that it will significantly reduce the disclosure obligations on companies when proceeding with a “Class 1” transaction (broadly those worth 25% or more of the listed company) and the requirement for shareholder approval.

Looked at through a litigation lens, these changes are likely to have two principal implications. Firstly, companies will not need to prepare a Class 1 circular for significant transactions, and will instead need to prepare an RIS announcement to enable investors to have a clear understanding of why the transaction is being undertaken. Such announcements could form the basis of future s.90A FSMA claims, as discussed further below.

Secondly, in terms of the content of market announcements, while some of the Class 1 circular regime requirements have been replicated, the FCA has dispensed with many of the mandatory financial disclosures required previously for Class 1 circulars. Accordingly, the amount of information disclosed to the market in the context of a Class 1 transaction will, overall, be reduced, although in CP 23/31 the FCA has slightly “enhanced” the Class 1 transaction disclosure requirements since CP 23/10, to better inform shareholders’ ongoing investment decisions. These are in addition to MAR and overarching obligations on issuers to provide all necessary information to enable shareholders to assess the terms and impact of the transaction.

In summary, the Class 1 notification must contain:

  1. The basic information for a Class 2 transaction notification, including details of any break fee arrangements, the benefits and risks of the transaction on the listed company and a statement by the board that the transaction is, in the board’s opinion, in the best interests of security holders as a whole;
  2. Limited financial information on the target (including historical financial information for at least 2 years, rather than 3) or, where this is not available, an explanation of how the price has been determined and a statement from the board that it considers the price is fair; and
  3. A statement on the effect of the transaction on the group’s earnings and assets and liabilities (ie a light-touch pro-forma).

Returning to what this might mean from a litigation perspective, every market announcement creates a potential trigger for liability under s.90A FSMA. The statements which form the basis of FSMA claims against companies are often the result of a trawl through publications to identify isolated statements which are, in hindsight, asserted to be false or misleading. The new Class 1 transaction regime will lead to more market announcements and therefore more potential hooks for shareholders to raise s.90A claims. While the number of market announcements will increase, the scope of information disclosed in respect of Class 1 transactions will reduce. There is a risk that because less information is required to be disclosed, the importance of the information which is disclosed (and the risk of not disclosing material information) increases.

Importantly, the FCA’s changes also mean that no third-party advisers are required to be involved in preparing the announcement. Companies should continue to scrutinise carefully the disclosures made (or omitted) from announcements and keep a contemporaneous record of their decision-making process. It may be prudent for companies to attempt to mitigate any potential liability under a future s.90A FSMA claim by continuing to engage professional advisers to justify any statements made in, or excluded from, announcements. This is because in any subsequent litigation, if directors have received advice from professional and experienced advisers it can serve as an indicator to the court that the board has not acted recklessly (or dishonestly).

The disputes risks outlined above are discussed in more detail in our previous blog post on CP23/10. Similar risks will arise for related-party transactions (broadly those worth 5% or more of the listed company), for which the FCA is also proposing to remove the need for shareholder approval.

Governance Code and annual reporting

The FCA has maintained its “comply or explain” requirements in relation to environmental, social and corporate governance (ESG) related annual disclosure. It has clarified that these requirements will extend to all commercial companies, which will be required to include in their annual financial report a statement of how they have complied with the applicable Principles set out in the UK Corporate Governance Code. If they have not complied, they must explain why.

These new disclosure obligations, coupled with greater focus generally on  ESG-related matters by  investors, heighten the risk of shareholder claims. The more public statements made by companies in relation to ESG matters, the greater the risk of a perceived discrepancy between words and actions and the greater likelihood that shareholders may resort to a s.90A claim to challenge disclosures related to matters like climate change transition plans. Again, it is important that companies minimise potential liability where possible by ensuring their ESG disclosures are accurate, justifiable and supported by good records.

Role of sponsors

The FCA has confirmed it will still require a prospectus to be produced for an issuer seeking admission of its equity shares to a regulated market. The FCA indicates that the sponsor’s role at the listing gateway should remain “largely unchanged” save for no longer having to assess whether an applicant meets the historical financial information, 3-year financial track record or clean working capital statement eligibility requirements that currently apply, which the FCA recognises passes on “greater risk” to investors.

The FCA will not require a prospectus for a listed company where it issues further equity on regulated markets. It has clarified that the role of sponsors would instead be focused on significant increases in share capital requiring a prospectus (subject to the ongoing consultation on the prospectus trigger threshold), related party fair and reasonable opinions, reverse takeovers and certain transfers between listing categories. The FCA is currently seeking views on whether its proposed approach is proportionate.

A reduction in the number of prospectuses published will likely reduce the risk of s.90 FSMA claims (which relate to allegedly untrue or misleading statements in / omissions from prospectuses). It will likely lead to an increase in investor scrutiny of other company disclosures/announcements related to equity, which may increase the risk of s.90A FSMA claims.

Next Steps

The FCA’s consultation period closes on 22 March 2024 (save for sponsor competence proposals, the consultation period for which ends on 16 February 2024). The FCA expects to implement the new listing rules in the second half of 2024. A consultation paper on new draft prospectus rules will follow later in 2024.

If you have any queries in relation to the impact of the listing regime proposals on shareholder claims, please get in touch with one of the contacts below or your usual HSF contact.

Simon Clarke
Simon Clarke
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Ceri Morgan
Ceri Morgan
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Meg Lawson
Meg Lawson
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Greenwashing dispute risks – International perspectives

Fuelled by the global spread of ESG and climate-related disclosure obligations and coupled with pressures from increasingly ESG-driven stakeholders, businesses are saying more than ever about their environmental and social performance. These statements might be product-specific, relate to investment strategy or corporate governance. Such statements might be seen as good marketing, positive for a company’s reputation and may well reflect a laudable transparency or ambition. But what are the potential legal consequences if these statements are attacked as inaccurate, unsubstantiated, misleading or false (ie, “greenwashing”)?

This article in our series on climate disputes explores the increasing risks for a business in making environmental or social claims, focusing on the UK, Australia and the US.

To follow the rest of this series, please subscribe to our ESG Notes blog or see our Climate Disputes Hub.

High Court strikes out novel bid to bring securities class action using CPR 19.8 representative action as “opt-in” procedure

The High Court has refused to allow a securities class action to proceed as a representative action under CPR 19.8, finding that any claims should be pursued as ordinary multi-party proceedings with the investors as claimants: Wirral Council v Indivior PLC [2023] EWHC 3114 (Comm).

CPR 19.8 allows a claim to be brought by (or against) a party as representative of any other persons with the “same interest” in the claim. It is ordinarily seen as an “opt-out” procedure, as there is no requirement to identify the represented parties or join them to the action but any judgment will be binding on them. In this case, unusually, the representative claimant sought to use CPR 19.8 as an “opt-in” procedure on behalf of investors who agreed to funding arrangements and were identified to the defendants. More specifically, it wished to adopt the “bifurcated process” envisaged by Lord Leggatt in the Supreme Court’s landmark decision in Lloyd v Google [2021] UKSC 50 (considered in our blog post here), which allows a representative action to proceed in order to decide issues that are truly common to the represented class, leaving any individual issues to be dealt with later.

Accordingly, the claim sought declarations on “defendant-side” issues only, such as whether the defendants had published untrue or misleading statements to the market, and did not include “claimant-side” issues such as standing to sue, reliance, causation and quantum. In fact, that was the advantage of the procedure, so far as the representative claimant and the investors were concerned: if allowed to proceed, the burden would fall squarely on the defendants to deal with defendant-side issues, and the investors could avoid spending time and money developing their case on the claimant-side issues until the later stage.

The court, however, rejected the claimants’ attempt to tie its hands in that way. The question of how to manage the claims, including which issues should be progressed at which stage, was for the judge managing the claims to consider by reference to the court’s overriding objective of dealing with cases justly and at proportionate cost. It would be unfair and unjust, and contrary to the overriding objective, to allow the representative proceedings to oust the court’s jurisdiction to case manage the claims from the start.

This decision is good news for defendants as it suggests claimants will not be permitted to use the CPR 19.8 representative action procedure to gain tactical advantages as to how a securities class action (or other action) will be managed, and in particular to place the whole burden on the defendant for the initial stage. The proper split of issues, and how the burdens of the litigation should be shared between the parties, will in every case be for the court to consider in exercising its case management powers.

Background

Wirral Council, as administering authority of Merseyside Pension Fund, issued representative proceedings under CPR 19.8, in effect seeking to use that mechanism to bring a securities class actions against the defendants pursuant to ss.90 and 90A and Schedule 10A of the Financial Services and Markets Act 2000 (FSMA). The claims related to an alleged scheme for the fraudulent marketing of its opioid addiction drug “Suboxone”, in order to switch the market from a version that was losing patent protection to an alternative version that would be less susceptible to generic competition, which had led to a federal indictment brought against the defendants by the US Department of Justice.

The claimant alleged that the defendants’ failure to disclose information about the scheme meant that its published information had (for the purposes of s.90A) contained untrue or misleading statements relating to the securities, and/or dishonest omissions of information that should have been disclosed, to the knowledge of persons discharging managerial responsibility (PDMRs) within the defendants. In relation to one of the defendants, there was also a claim for prospectus liability under s.90 based on essentially the same facts.

The claimant sought to try the above issues, the so-called “defendant-side issues”, which were not dependent on any facts particular to any individual investor, using the representative action procedure. Accordingly, the claim sought declarations as to the existence of untrue or misleading statements or dishonest omissions, and as to PDMR knowledge/dishonesty. It did not include as part of the representative proceedings any “claimant-side issues”, such as standing to sue, reliance, causation and quantum.

The proceedings were brought on an “opt-in” basis, because the represented class of investors was defined to include only those who signed up to a costs sharing and governance agreement and whose identities were made known to the defendants’ solicitors by a specified date.

The defendants applied to strike out the representative proceedings, or for an order that Wirral could not act as a representative claimant for the investors as represented persons. They argued that representative proceedings were not the appropriate procedure for the claims, and that they should be brought in the usual way as multi-party proceedings with the investors as claimants.

In fact, multi-party claim forms had been issued against both defendants by most of the institutional investors who were included in the CPR 19.8 action, alleging the same causes of action under FSMA. Those proceedings were stayed pending resolution of the applications. The multi-party proceedings did not, however, include the retail investors who were included in the representative action, as the litigation funders backing both sets of proceedings would not agree to fund them for the multi-party action.

Decision

The High Court (Mr Justice Michael Green) granted the defendants’ applications and struck out the proceedings.

The management of securities claims

The judge started by looking at how securities claims under s.90A and Schedule 10A FSMA have to date been managed by the court, noting that the case management issues that commonly arise include: (i) whether there should be a split trial: (ii) if so, what split; and (iii) whether and to what extent progress should be made on the deferred issues in the meantime, eg by requiring the provision of further information, disclosure or witness evidence.

He referred to a number of cases in which there was to be a split trial but, before the first trial, the claimants had been ordered to take material steps in relation to issues that were to be dealt with at the second trial, such as claimant sampling on the issue of reliance, disclosure from sample claimants and clarification of individual cases. He referred to the decision of Falk J in Various Claimants v G4S Ltd [2022] EWHC 1742 (Ch), in which she emphasised that some progression of the claimants’ case was needed to facilitate settlement discussions, reduce the gap between trials and “try to ensure an appropriate balance and fairness in the burden between the parties”.

Lloyd v Google and the bifurcated process

Michael Green J noted that the “same interest” threshold requirement had been met in the present case and therefore the claimant had been entitled to bring the representative action under CPR 19.8, but the court nonetheless had a discretion whether to allow the proceedings to continue. This was clear from Lord Leggatt’s decision in Lloyd v Google. There was no presumption in favour of the representative action.

Similarly, while Lord Leggatt’s comments in Lloyd v Google suggested that a bifurcated procedure using CPR 19.8 could be appropriate in some cases, the claimant in that case was not seeking bifurcation and so the comments were obiter (though deserving of the highest respect). The represented class in Lloyd v Google was estimated to be more than four million people, and it was clear that the only way the claim could realistically be brought was by an “opt-out” representative action. It was in that context that Lord Leggatt commented, “it is better to go as far as possible towards justice than to deny it altogether”.

Michael Green J noted that, in Lloyd v Google, the Supreme Court was “advocating for greater use of the representative action, principally where it would provide access to justice that would not otherwise be available to that class of claimants”. Lord Leggatt dealt in passing with bifurcation as a potential solution where individual damages claims could not be tried in the representative action, but did not explain how bifurcation would work in practice and made it clear each case would need to be decided by reference to the overriding objective.

The court’s exercise of discretion

Michael Green J said he was not deciding, in these applications, how securities claims in general should be brought. He was deciding how the court’s discretion should be exercised in the particular claims in question.

While Lloyd v Google might be seen as encouraging the use of representative actions, the judge did not think Lord Leggatt would have contemplated that his judgment would be used to oust the court’s ability to case manage these sorts of claims from the start. Bifurcation was not intended as the reason for using a representative action in the first place. It could be used to enable a representative action to proceed, particularly where it was necessary to provide access to justice for those whose proceedings could not otherwise be brought (though that was not to say claimants would necessarily have to show they could not bring the claims in any other way) – eg where there was a very large number of claimants with claims that were too small to bring individually.

Here, the representative proceedings could not be looked at in isolation. The claims had to be looked at as effectively one set of proceedings all the way through to the potential recovery of compensation for the represented investors, since that was the only point of the action. To say that the court need only consider how the issues raised in the CPR 19.8 claim should be tried would be “shutting one’s eyes to reality”.

The judge commented that the claimant’s position seemed “quite extraordinary”. The case law showed how judges in these cases carefully balanced all the competing interests in deciding how the cases should be managed, including what split was appropriate and to what extent the issues for the later stage should be progressed before the first trial. The claimant’s position, in contrast, was that the investors should be able to decide, unilaterally, to bifurcate the proceedings as they like. Lloyd v Google did not give them that entitlement, and the court could not further the overriding objective by depriving itself of the ability to apply the overriding objective in case managing the claims.

Further, the existence of the multi-party proceedings that had been issued in parallel showed that institutional investors had not been deterred from pursuing their claims by the way that securities cases are managed in this jurisdiction. While they might prefer not to incur cost and effort preparing their cases until after the first trial, that was contrary to how litigation is normally conducted in this jurisdiction and would mean the proceedings would not be concluded expeditiously. As the case law made clear, “claimants must properly plead and particularise their cases from the beginning and it should not be as simple as subscribing to litigation without any risk or cost being incurred”. Although the position of retail investors was different, the court did not accept that they could only seek redress through the representative proceedings, even if the current funders would not support their claims in the multi-party proceedings. There was no evidence that they would not be able to obtain their own funding and issue their own proceedings, which could then be consolidated or at least managed together with the multi-party proceedings.

Accordingly, the court exercised its discretion against the continuation of the representative proceedings. If the claimants wished to proceed with the multi-party proceedings, those proceedings could be managed in the normal way so as to further the overriding objective. The claimants could argue for the same split of issues, with no progress on claimant-side issues in the meantime, and it would be up to the judge managing the case to decide whether that was appropriate. But it would be “unfair and unjust, and contrary to the overriding objective” to allow the representative proceedings to oust the court’s jurisdiction to case manage the claims from the start.

Rupert Lewis
Rupert Lewis
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Chris Bushell
Chris Bushell
Partner
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Julian Copeman
Julian Copeman
Partner
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Maura McIntosh
Maura McIntosh
Professional Support Consultant
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Ceri Morgan
Ceri Morgan
Professional Support Consultant
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Company not ordered to disclose privileged documents to shareholders in context of late application in securities class action

In an oral judgment delivered at the end of a one-day hearing, the High Court has refused an application by the claimants in a securities class action for disclosure of privileged documents by the defendant company: Various Claimants v G4S PLC [2023] EWHC 2863 (Ch).

The decision considers the boundaries of the so-called “shareholder principle”, ie that a company cannot assert privilege against its shareholders unless the documents were produced for the dominant purpose of litigation between the company and its shareholders. The decision will be of particular interest to banks and listed issuers facing disclosure applications by claimants seeking to rely on the shareholder principle in order to obtain access to a wider pool of documents in securities class actions.

The judge noted that the principle had been recognised in many authorities, including the Court of Appeal’s decision in Woodhouse and Co (Ltd) v Woodhouse [1914] 30 TLR 559, and in Hollander on Documentary Evidence which states that the rule is so well established that it is now probably only the Supreme Court that could overturn it. Accordingly, the judge said, “as a lowly first instance judge, and even though I have my doubts as to the justification now for such a principle”, he could not say that the principle did not exist or should be got rid of.

Ultimately the judge declined to order disclosure on case management grounds, given the real practical difficulties caused by the lateness of the application and the fact that, on the judge’s conclusions, only a small proportion of the claimants would be entitled to see the defendant’s privileged documents. He considered that it would be impossible to manage a trial where privileged documents were deployed by certain claimants and could not be disclosed to others, particularly as the claimants had the same solicitors and counsel. And it was too close to trial to separate out the claimants into different trials to protect privilege.

He did however express his views on a number of points as to the application of the shareholder principle which are unclear in the case law, including that the principle should apply only to registered shareholders, rather those who hold shares through the CREST securities depository or the broad class of those with “interests in securities” sufficient to bring a securities class action under s.90A and Sch.10A of the Financial Services and Markets Act 2000 (FSMA).

For more information, please see our Litigation blog post.

Herbert Smith Freehills contributes chapter to The Securities Litigation Review (9th Edition)

Herbert Smith Freehills have contributed the England and Wales chapter of The Securities Litigation Review. Now in its ninth edition, The Securities Litigation Review is a guided introduction to the class action regimes for securities claims in the key jurisdictions across the globe, providing a valuable resource for corporates and financial institutions who might face such claims.

Download chapter

Reproduced with permission from Law Business Research Ltd. This article was first published in May 2023.

Previous Editions:

8th edition 2022

7th edition 2021

6th edition 2020

5th edition, 2019

4th edition, 2018

3rd edition, 2017

Harry Edwards
Harry Edwards
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Jon Ford
Jon Ford
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Sarah Penfold
Sarah Penfold
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UK listing and prospectus regime reform: potential impact on securities litigation

The FCA has proposed a revolutionary restructuring of the UK listing framework. Its consultation paper (published in May 2023) sets out a blueprint for the UK’s new listing regime.

For an overview of the key proposals in the FCA’s consultation paper, please see our Capital Markets team’s briefing paper: UK Listing Regime Reform.

While the driver of the rule changes is the desire to attract and retain more listed companies in London, they are likely to have an impact on securities litigation. In this blog post, we consider the significance of these changes for claims brought by shareholders, in particular claims under ss.90 and 90A of the Financial Services and Markets Act 2000 (FSMA). Before considering the impact of the rule changes on litigation risk, we set out below a quick recap of these causes of action:

  • Section 90 FSMA provides a statutory remedy for shareholders who acquire securities and who suffer loss as a result of untrue or misleading statements in, or omissions of necessary information from, prospectuses or listing particulars relating to those securities (in essence, a “negligence” standard). It is a defence to such a claim if the defendant can show that it reasonably believed a statement was true and not misleading or an omission was properly made (the “reasonable belief defence”).
  • Section 90A (and its successor, Schedule 10A FSMA) is the statutory regime imposing civil liability for untrue or misleading statements in, or the omission of required information from, published information disclosed by listed issuers to the market via a recognised information service. An issuer will only be liable to the extent a director of the issuer: (i) knew a statement was untrue or misleading; or (ii) was reckless as to whether it was untrue or misleading; or (iii) knew an omission to be a dishonest concealment of a material fact (the “recklessness” standard). It is a requirement for a successful claim under Section 90A and Schedule 10A that a shareholder must have acquired, continued to hold or disposed of securities in reliance on the published information to which the claim relates.
  • Other potential bases for shareholder actions include claims brought under the Misrepresentation Act 1967 and common law claims for deceit and negligent misstatement as well as for breach of fiduciary and other equitable duties.

We consider below the impact of the key changes to the listing regime on future shareholder claims.

1. A single listing category

The FCA is proposing to collapse the current standard and premium listing segments into one single listing category for “equity shares in commercial companies” (the ESCC category), with one set of eligibility requirements and one set of continuing obligations for companies in that category.

The continuing obligations and eligibility requirements combine the existing requirements for premium and standard listed companies. This means that there will be some relaxations for premium listed companies and some increase in regulation for standard listed companies.

2. Class 1 and related party transaction shareholder votes and circulars to be dropped

One of the most revolutionary proposed changes, is the end to the requirements for mandatory shareholder approval and shareholder circulars in most cases on “Class 1” transactions (broadly those worth 25% or more of the listed company) under Listing Rule 10, and the consequent removal of the requirements to disclose historical financial information and a working capital statement. Similarly, the FCA is proposing removing the requirement for shareholder approval and a shareholder circular for large, related party transactions (broadly those worth 5% or more of the listed company).

From a litigation perspective, the most obvious consequence of removing the requirement for shareholders to approve Class 1 and related party transactions, is to eliminate a potential trigger point for claims.

This is most readily understood by reflecting on The Lloyds/HBOS litigation (see our briefing paper). In this case, the claims were centred on the all-share acquisition by Lloyds of its competitor bank, HBOS, at the height of the 2008 financial crisis. As a Class 1 transaction, Lloyds’ shareholders were required to approve the acquisition at an Extraordinary General Meeting. For this purpose, a shareholder circular was produced in November 2008, explaining the benefits and risks of the acquisition and containing a recommendation from the Lloyds directors as to how shareholders should vote. The key elements of the claim were that the directors of Lloyds negligently recommended to the shareholders that they should vote in favour of the acquisition of HBOS, and that they failed to provide shareholders with sufficient information to make an informed decision on how to exercise that vote and/or made negligent misstatements about the merits of the acquisition.

If the facts of this case took place in the future, under the proposed rule changes there would have been no requirement for the Lloyds directors to seek shareholder approval and no shareholder circular prepared, thereby removing the fundamental basis of the claim. However, the new rules provide that a transaction meeting the current Class 1 threshold of 25% would require an announcement containing the information currently required for a “Class 2” transaction (worth 5% or more of the listed company). A Class 2 style announcement requires a description of the effect of the transaction on the listed company, including any benefits which are expected to accrue to the company as a result of the transaction.

In our hypothetical scenario, this would have changed the shape of the litigation. Class 2 style announcements would have provided a platform for the Lloyds shareholders to bring a s.90A FSMA claim on the assertion that Lloyds made statements to the market about the proposed acquisition which were misleading. It would have been a challenging claim to bring in a number of respects, particularly given the higher fault standard under s.90A (dishonesty or recklessness rather than negligence) and the requirement to prove reliance for s.90A FSMA claims (which, although a necessary element of the negligent misstatement case brought against Lloyds and its directors, was not a feature of the negligent recommendation or sufficient information elements of the claim based on the shareholder circular).

More generally and notwithstanding the challenges to bringing a claim under s.90A FSMA (for the reasons set out in the previous paragraph), the importance of the disclosures to be made under the proposed rule changes will be magnified, such that claims may become more likely. In other words, if less information is required to be disclosed, the importance of the information which is disclosed (and the risk of not disclosing material information) increases. In particular, Class 2 style announcements may provide a hook for claims, on the basis that the company is required to give a “true” description of the effect of the transaction on the company and that it did not, for example by not disclosing a piece of information which, with the benefit of hindsight, turned out to be material. It is also worth noting that the requirements for Class 2 style announcements impose quite a high-level test which creates greater scope for argument as to whether it has been met or not.

One further impact of the changes is that there may be less internal scrutiny of a company’s disclosures, and less involvement from professional advisers (for example in preparing a working capital statement), particularly for smaller (less than 25%) transactions. In the Lloyds case, the board was able to take comfort from the large amount of work undertaken internally by management as part of the Class 1 process, and by its sponsors and other professional advisers. If professional advisers are not involved in the assessment of smaller transactions, it will be even more important for companies to ensure that statements made in any announcement can be justified, and that a comprehensive record is kept of judgment calls as to the materiality of information and what should be included/excluded from announcements. It may be that the wisest course to protect against future liability under s.90A will be to continue to undertake a fulsome verification exercise in relation to any transaction-related disclosures.

For other matters that will continue to need shareholder approval, the risks are likely to remain the same (eg cancellation of listing, reverse takeovers, transactions by companies in financial difficulties, issuing shares at a discount and share buybacks).

3. Governance Code and annual reporting

The FCA has proposed that other reporting and “comply or explain” requirements, which currently apply to premium listed companies only, will be applied to all companies in the ESCC category. For example, the FCA is proposing to retain the current key disclosure and “comply or explain” requirements which apply to standard and premium listed companies, in relation to climate and diversity related annual report disclosures.

ESG poses challenges to listed companies, including banks, in many forms – new taxonomies and disclosure standards; scrutiny of banks’ financial exposures to climate change; shareholder resolutions from activists; enhanced due diligence requirements to protect human rights; and warning shots about avoiding greenwashing, to mention a few. The more disclosures made in connection with ESG, the greater the risk of litigation under s.90 FSMA, s.90A FSMA, or at common law or in equity.

4. Simplified eligibility requirements

Some of the eligibility requirements for issuers seeking admission to listing which are seen as acting as a deterrent to companies listing, will be modified and investors will instead need to look to the disclosures made by issuers to make an informed investment decision. The FCA is looking to open the market to more diverse business models and more complex corporate structures.

For example, the FCA is proposing to remove the eligibility requirements relating to historical financial information and revenue earning track record. It is also proposing to delete the requirement that an applicant for listing satisfies the FCA that it has sufficient working capital (ie that it can give a clean working capital statement).

This rule change is underpinned by the principle that many investors are sophisticated enough to analyse financial disclosures to make informed choices. Of course, there will remain a need for specific prospectus regime disclosure requirements in this context, and we look forward to detailed rules from the FCA in this regard. However, the key takeaway from a litigation perspective, is that this shift will inevitably magnify the importance (and potentially increase the number) of financial disclosures made by issuers wishing to carry out an initial public offering (IPO). The simple point is that this may also increase the risks of s.90 FSMA claims in respect of allegedly misleading statements in/omissions from prospectuses.

5. Prospectus regime

The FCA is also taking bold steps to reform the UK’s prospectus regime and has published a series of engagement papers setting out in more detail the key issues it is considering. The engagement papers can be found on the following FCA webpage: New regime for public offers and admissions to trading. Our Capital Markets colleagues have published a full note on the prospectus engagement papers here: UK Prospectus Regime review – bold reform ahead.

The matters on which the FCA is currently seeking views are set out below, together with our initial analysis of the likely impact on litigation risk.

Admission to trading on a regulated market (Engagement Paper 1)

The FCA says that the requirement for a prospectus on an IPO will remain and it will continue to need to contain sufficient detail to meet the “necessary information” test. Accordingly, the overall disclosure standard for prospectuses will be maintained, preserving the status quo for s.90 FSMA claims, in this respect at least.

The FCA is asking for views on when exemptions to this requirement should apply, the required content and format of a prospectus in this context, and the responsibility for, and approval of, such a prospectus.

Further issuances of equity on regulated markets (Engagement Paper 2)

The FCA says there will be no requirement for a listed company to publish a prospectus when it issues further equity securities unless there is a clear need for one. It asks whether there should be a threshold (set by reference to the percentage of existing share capital that the issuance represents) above which a prospectus would be required and what document (if any) should be required if/where a prospectus is not required.

A reduction in the number of prospectuses published would increase investor/market scrutiny of company disclosures/announcements related to equity issues since s.90A claims may be available for any untrue or misleading statements made to the market, or omissions or delays in publishing required information.

Protected forward-looking statements (PFLS) (Engagement Paper 3)

The FCA seeks views on how PFLS, which will be subject to the higher recklessness liability standard under the FCA’s proposals, should be defined. It also asks whether the FCA should set certain minimum criteria for the production of PFLS, how they should be presented and labelled in prospectuses, and whether sustainability-related disclosures should be PFLS.

As a reminder, the rationale for changing the statutory standard of liability for PFLS was underpinned by Lord Hill’s view that the existing prospectus regime deters issuers from including forward-looking information in their prospectuses, due to the current level of liability attached (ie the “negligence” standard under s.90 FSMA described above). In order to improve the quality of information that investors receive directly, Lord Hill recommended adjusting the standard of liability for PFLS to the same recklessness standard as under s.90A FSMA and s.463 of the Companies Act 2006 (in respect of directors’ liability for untrue/misleading statements in, and omissions from, a directors’ report etc.).

Recklessness is a higher fault standard than negligence. While negligence generally involves a failure to exercise reasonable skill and care, recklessness requires a higher degree of awareness and disregard for risk. In ACL Netherlands BV & Ors v Lynch & Ors [2022] EWHC 1178 (Ch) (commonly referred to as the Autonomy judgment), the High Court confirmed that recklessness in this context will have the meaning laid down in Derry v Peek (1889) 14 App. Cas. 337: “not caring about the truth of the statement, such as to lack an honest belief in its truth. Honest belief in the truth of a statement defeats a claim of recklessness, no matter how unreasonable the belief (though of course the more unreasonable the belief asserted the less likely the finder of fact is to accept that it was genuinely held)”. You can find our blog post on the Autonomy decision here: How to navigate the Autonomy judgment: guidance for corporate issuers defending Section 90A / Schedule 10A FSMA shareholder claims.

Accordingly, it will be more difficult for an investor to bring a successful claim for breach of s.90 FSMA in respect of a PFLS as a result of these reforms. In turn, this means that how a PFLS is defined will be very important, to give issuers clarity as to the potential risks attached to any forward-looking statements. The fact that the FCA is looking at whether PFLS includes sustainability-related disclosures will elevate the significance of this engagement paper, given the growing trend of ESG-related litigation, and emerging regulatory requirements to make sustainability disclosures.

Initial thoughts on the engagement papers

If the reforms outlined in the engagement papers go ahead, the likely overall impact will be fewer prospectuses, at least for secondary capital raises, and therefore fewer bases on which to bring s.90 FSMA claims. When combined with the potentially higher liability threshold for forward-looking statements in prospectuses (a shift from negligence to recklessness), it seems likely that we will see more claims being brought instead under s.90A.

From a practical perspective, although prospectuses will no longer be mandated for further equity securities under these reforms, it remains to be seen what disclosures companies will need to make in order to market a particular offer of shares outside the UK, and particularly into the US. It may be that a company has to provide additional information to the market beyond that mandated by UK rules to satisfy overseas securities laws, or that professional advisors recommend additional voluntary disclosures in order to seek to protect the company from potential non-UK liabilities.

6. Next steps

The FCA’s consultation on listing rule reforms closes on 28 June 2023 and written responses to the questions raised by the prospectus engagement papers must be submitted by 29 September 2023. Following the consultation and engagement process, the FCA expects to publish a second consultation paper containing draft listing rules in the autumn and plans to accelerate its final rule making processes. We expect the new listing rules to be implemented in early 2024. A consultation paper on new draft prospectus rules will follow later in 2024.

If you have any specific queries in relation to the impact of the proposals on s.90/90A FSMA claims, please get in touch with one of the contacts below or your usual HSF contact.

Rupert Lewis
Rupert Lewis
Head of Banking Litigation
+44 20 7466 2517
Simon Clarke
Simon Clarke
Partner
+44 20 7466 2508
Sarah Hawes
Sarah Hawes
Head of Corporate Knowledge, UK
+44 20 7466 2953
Ceri Morgan
Ceri Morgan
Professional Support Consultant
+44 20 7466 2948
Sarah Penfold
Sarah Penfold
Senior Associate
+44 20 7466 2619

High Court considers reliance in s.90A FSMA claims in context of split trial application

A recent judgment handed down by the High Court will be of interest to financial institutions following developments in securities class actions: Various Claimants v Serco Group plc [2023] EWHC 119 (Ch).

The decision considers the identity of sample claimants, for the purpose of a split trial order. For those monitoring the risk profile of claims under s.90A of the Financial Services and Markets Act 2000 (FSMA), the most interesting aspects of this judgment are the observations made by the defendant, and the court, on the critical question of reliance, which has become a central battleground in such claims.

The judgment reveals that the shape of the Serco litigation has changed significantly since the first case management conference (CMC) last year. During this period, the court handed down judgment in the first s.90A FSMA case to come to trial in this jurisdiction, in ACL Netherlands BV & Ors v Lynch & Ors [2022] EWHC 1178 (Ch) (otherwise known as the Autonomy litigation; see our banking litigation blog post). In the Autonomy judgment, the court confirmed that reliance must be upon a statement or omission, rather than, in some generalised sense, on a piece of published information (e.g. the annual report for a given year).

The defendant suggested that the Autonomy judgment has had the following impact on the scope of the claims against it in the Serco litigation: (i) cases based on direct reliance are now much more limited; (ii) a material number of claimants have dropped out; and (iii) those claiming on the basis of indirect reliance have great difficulties because of the clarification of reliance in Autonomy. These are interesting (although not unexpected) developments, given that the requirement for a claimant to show what it relied upon will make it more difficult to bring a successful s.90A claim.

The present judgment also confirms that the claimants in the Serco litigation are now relying on two categories of indirect reliance as follows:

  • Market reliance: i.e. a decision, including an automated decision to acquire, continue to hold or dispose of shares in the market at the (inflated) price at which they were in fact acquired and held.
  • Price reliance: i.e. market reliance in circumstances in which the claimant was also aware of the price of the shares, and believed the published information to be true, complete and accurate.

The court accepted that (in some respects) the developments which have occurred since the first CMC have been significant, and the fact that no claimant seeks to advance a direct reliance case based on specific statements in the defendant’s published information is “material”. However, in the context of the application relating to the identity of sample claimants, the court was not persuaded to move away from the sampling approach ordered at the first CMC, and it rejected the defendant’s move to include all of the indirect reliance cases in the second trial.

Background

The decision relates to a claim for losses suffered by certain institutional investors, in relation to shares held in a listed company, Serco Group plc (Serco), between 2006 and 2013, based on s.90A and Schedule 10A FSMA.

The key question before the court in the present judgment related to an order for a split trial, which was made following the first CMC in this case. The court directed that there would be a split trial, as follows:

  • A first trial covering the standing of the claimants and so-called common issues relating to Serco (whether there was fraud; the content of or omissions from published information; whether there had been dishonest delay; who were persons discharging managerial responsibility (PDMR); and whether any PDMR had the requisite knowledge).
  • A second trial covering so-called individual issues related to the claimants, namely, reliance, causation, loss and quantum, and limitation. The issues at the second trial were to be determined in respect of a sample of the claimants or sample funds only.

Since the CMC, the parties had made some progress in agreeing on the number and identity of the sample claimants, but two significant issues remained outstanding, which in large part related to questions of reliance.

Decision

By the time of the hearing, the following important points on the claimants’ reliance case were clear:

  • The reliance placed by the claimants on the defendant’s published information can be categorised as either: (1) direct reliance; or (2) two forms of indirect reliance: market reliance and price reliance.
  • The claimants described what they meant by the two categories of indirect reliance as follows:
    • Market reliance is “[a] decision, including an automated decision to acquire, continue to hold or dispose of shares in the market at the (inflated) price at which they were in fact acquired and held.”
    • Price reliance is market reliance in circumstances in which the claimant was also aware of “(a) the price of the shares and (b) the published information being true, complete and accurate.”
  • Where direct reliance is alleged, it is limited to reliance on the defendant’s published information as a whole, not on individual statements within the published information.

The defendant submitted that it would be proportionate for all of the non-direct reliance cases to be tried at the second trial, because such claimants were likely to have great difficulties in light of the Autonomy decision, and it would achieve certainty if they could be disposed of. However, the claimants said that this approach would move away from the sampling approach and be wrong in principle.

The court accepted that, in some respects, the developments since the first CMC had been significant (in particular, it was material that no claimant sought to advance a direct reliance case based on specific statements). However, in the court’s view, the developments did not justify an inclusion of all the indirect reliance cases to the existing cohort of sample claimants. The court justified this decision based on the following factors and conclusions:

  • Appropriate weight must be given to the fact that the parties have proceeded for the past year on the course set by first CMC order.
  • The addition of 27 master claimants at trial two would detract from a just and effective resolution of the dispute, and from costs efficiency.
  • The defendant had underestimated the evidence required from the claimants to make good the price reliance claims, which may not be straightforward and may well be challenged.
  • The defendant had underestimated the extent of the evidence and disclosure required from each individual claimant to prove that facts relevant to their cause of action under s.90A FSMA had been deliberately concealed from them by the defendant (thereby discharging the burden under s.32 of the Limitation Act 1980).
  • The same point could be made about the expert evidence required for quantification.
  • Each of the new master claimants would have to be treated as a separate claim and the additional burden imposed by their inclusion did not justify the limited benefit of a final resolution of those claims.

Accordingly, the court concluded that a sampling approach for both indirect and direct claims remained the right way forward.

A sampling approach has been adopted in earlier claims under s.90A FSMA, against RSA Insurance and G4S, and the court explained that its purpose is to try to ensure that decisions on individual issues provide as much guidance as possible, while recognising that the court’s decision will not be binding in respect of individual issues of other claimants. The court stated in this case that sampling requires:

“A balance to be struck between ensuring that appropriate similarities are identified in order to maximise the number of cases which will in practice be resolved, while not at the same time having so many sample cases that the exercise becomes unwieldy and fails to achieve the purpose for which it was imposed”.

The court also rejected an alternative proposal by the defendant: that the existing body of sample claimants should be expanded to add certain specified claimants with market reliance and price reliance claims, because there were no other claims in the sample with the same form of reliance, and/or because it was desirable for larger claims to be resolved at trial two if at all possible.

The court did not agree that it should automatically direct large claims to be included within the sample group, if there was no other justification for doing so. Stepping back and looking at the group of sample claimants as a whole, the court said it must always recognise that not every difference between the position of individual claimants and funds can be captured by a sample, and no answer is perfect. The key is to try to pick those cases which appropriately represent a wider body of claimants and common issues without overcomplication, recognising that not every fine detail can be captured.

The court therefore approved the group of sample claimants agreed by the claimants.

Rupert Lewis
Rupert Lewis
Partner
+44 20 7466 2517
Simon Clarke
Simon Clarke
Partner
+44 20 7466 2508
Ceri Morgan
Ceri Morgan
Professional Support Consultant
+44 20 7466 2948
Sarah Penfold
Sarah Penfold
Senior Associate
+44 20 7466 2619

Latest split trial decision in securities class action under s.90A FSMA

At a recent Case Management Conference (CMC), where a split trial was proposed by the claimants in a claim brought pursuant to Section 90A and Schedule 10A of the Financial Services and Markets Act (FSMA), the High Court has held that reliance issues should be heard at the second trial, with defendant liability issues to be heard in the first: Various Claimants v G4S Limited [2022] EWHC 1742 (Ch).

In securities class actions, claimants will often seek to postpone issues involving reliance, causation, quantum and limitation to a second trial. This has the double advantage of (a) enabling the claimants to postpone incurring a significant portion of their costs until after the question of liability has been determined; and (b) making the defendant’s conduct the sole focus of the first trial.

Defendants will generally seek to resist this split, noting the potential for unfairness in the allocation of the litigation burden, as well as the potential for the claimants’ witnesses to be influenced by the findings in respect of liability when preparing their evidence in relation to reliance. Furthermore, to the extent findings are made against the defendant in the first trial, the overall length of the process would likely be significantly longer than if there was no split.

Ultimately in this case, although the court held that there should be a split trial, and that reliance issues ought to be heard at the second trial (noting, in particular, the complexity of the claimants’ reliance cases), it acknowledged the potential unfairness to the defendant if disclosure and witness statements were not provided by the claimants in advance of the first trial. In order to seek to mitigate the potential unfairness, the court determined that:

  1. All claimants must provide the defendant with a minimum amount of information in relation to:
    1. Their reliance cases, including (a) whether it is said that particular named individuals reviewed the relevant published information and relied on it or whether, for example, the only evidence a particular claimant can provide in that respect is of a general practice; and (b) whether the claimant relies only upon the most recently published information, or also upon historic information;
    2. Their limitation arguments, such as whether it will be alleged that there is something particular to a specific claimant that means that they could not with reasonable diligence have discovered something, as compared to another claimant;
    3. Information about whether a claimant claims to have relied upon meetings with the defendant (noting that liability under section 90A and Schedule 10A is by reference to “published information” only and not to comments in meetings); and
    4. Disclosure, such as the document retention policies each claimant has in place.
  2. That information must be provided in order to ensure that the claimants’ reliance cases are properly particularised, and also to enable effective sampling to occur, so that the parties can minimise the risk that more than two trials will be required (as would be necessary, for example, if the sample selected did not fully reflect the characteristics of all claimants).
  3. Sample claimants, once selected, must give disclosure in advance of the first trial (including in relation to all aspects of their reliance case).
  4. A further CMC will be held after the claimants have provided the defendant with the further information outlined in (1) above, at which the court will determine which claimants will be required to provide witness evidence in relation to their reliance cases in advance of the first trial. The court indicated that this would be likely to include claimants bringing specific reliance claims.
  5. That CMC will also consider whether there are any further points of law which might sensibly be disposed of at the first trial.
  6. To the extent that any claimants wish to rely upon meetings with the defendant in relation to their claims, evidence in relation to those meetings must be provided in advance of, and will be heard at, the first trial.

Such an approach will help to balance the litigation burden, alleviate concerns over the influence that any findings from the first trial may have upon witness recollections, and will mean that, to the extent a second trial is required, it can be heard relatively soon after judgment is given in the first, mitigating the defendant’s timing concerns.

Chris Bushell
Chris Bushell
Partner
+44 20 7466 2187
Sarah Penfold
Sarah Penfold
Senior Associate
+44 20 7466 2619

ESG Updates – The Bank of England Climate Biennial Exploratory Scenario

The Bank of England (BoE) has published the results of the Climate Biennial Exploratory Scenario (CBES), which explores the financial risks posed by climate change for the largest banks and insurers operating in the UK. In line with the findings of other central bank stress tests across the globe, the CBES found that while the financial system might be adequately capitalised to absorb the shocks of climate change scenarios, the sector would suffer losses across each scenario, with the greatest quantifiable losses suffered in a No Action and Late Action scenario. This reaffirms the BoE’s drive to an early and orderly transition to a net-zero economy.

  • In June 2021 the BoE launched the CBES, seeking to explore and better understand the financial risks posed by climate change to the UK financial system, and to ensure that real change is effected to help with systemic resilience.
  • Following the submission of participants’ initial responses in October 2021, we looked at the CBES in the context of other central bank initiatives and stress tests across the globe, to understand the scope of the CBES as part of our November 2021 Global Banking Review, which focussed heavily on the issues facing financial institutions in connection with Climate Change.
  • Just over six months later the BoE has published the results of the CBES, and we consider here what it has learnt, where will the focus fall, and what will come next?

Summary of key findings – Banks

The climate risks captured in the CBES scenarios are likely to create a drag on the profitability of both UK banks and insurers. Loss projections varied across participating firms and the three different climate scenarios but equated to an annual drag on profits of around 10-15% on average. Projections suggested (unsurprisingly) that the overall costs will be lowest in scenarios with early, well-managed actions to transition to a net-zero economy.

However, the CBES found that there was substantial uncertainty as to the magnitude of climate risks. The figures identified in the BoE report were heavily caveated to allow for various acknowledged limitations, with this, its first CBES, including:

  • The banks’ projections were focused on credit risk, and did not yet fully take into account possible impacts resulting from market risk;
  • The data used to populate responses from firms was incomplete and inconsistent in its approach – for example, loss estimates on the same corporate customers differed substantially in participating firms’ responses;
  • The ‘No Action’ scenario would likely incur losses past the time horizon selected for the CBES projections, and as such projections for this scenario were likely partial; and
  • The BoE acknowledged the limitations of the fixed balance sheet approach adopted for the CBES.

Despite these, and other limitations, the CBES included a number of interesting observations for market participants:

Quantitative findings – calculating the risk

  • Projected climate risk impacts were highest for banks’ wholesale and mortgage exposures, and projected climate-related consumer credit losses were relatively low.
  • Institutions which relied upon third-party modelling and data without sufficient internal capability to challenge and scrutinise often gave rise to materially lower loss projections than those institutions which had invested in and developed their own internal models. The development of internal models was more established in the insurance than the banking sector.
  • Limitations caused by data gaps and inconsistent data provision from third parties such as clients and counterparties were again noted. In particular, the lack of available data regarding corporates’ current value chain emissions and future transition plans was a common issue affecting firms. The BoE also recommends that banks act to encourage remediation of data limitations and gaps to help firms meet the PRA’s supervisory expectations, as set out in SS3/19. Firms’ efforts in this area will be supported by initiatives currently in train to resolve some of these data gaps.

Qualitative findings – planning ahead

  • Responses to the qualitative secondary part of the CBES, which focused on transition planning, suggested that some banks, in particular, were not considering their transition plans holistically: they were failing to take into account the likelihood of similar management actions from competitors or adjusting for different macro scenarios.
  • Transition plans suggest that banks intend to divest from energy-intensive sectors. The BoE sounded a note of caution in relation to these suggestions and to the idea that capital requirements could be used to target investment towards “green” sectors and away from energy-intensive sectors. The BoE noted the systemic risk inherent in depriving energy-intensive sectors from the funding they would need to transition towards net-zero, and also the economic repercussions of mass divestment from providing finance to carbon-intensive sectors ahead of the expansion of renewable energy supply.
  • Capital adequacy remains at the forefront of the BoE’s mind, but in the context of developing (along with other central banks) Solvency II to better accommodate the nuances of climate change risk, rather than using the BoE’s prudential regulation as a pseudo-governmental arm seeking to drive policy change.
  • While participating firms were making good progress in some aspects of climate risk management, they all had more work to do to improve their climate risk management capabilities.

Climate Litigation Risk 

As part of the CBES, the BoE engaged with members of the London Insurance Market to understand the extent to which existing policies would cover climate-related litigation. Following the trend of increasing climate-related litigation (particularly in the United States, which is ahead of many European jurisdictions in this regard), the BoE wanted to look at the impact of this development in the contentious landscape. The BoE identified seven ‘types’ of climate-related litigation, these are set out in full below:

  • Direct causal contribution: a corporate is found liable for its representative contribution to manmade climate change.
  • Violation of fundamental rights resulting in cessation or reduction of operations: a corporate is prevented from practising carbon-intensive activities that violate fundamental human and dignity rights, this has a significant impact on financial revenues.
  • Greenwashing: a corporate is found to be misleading customers (e.g. false advertising, mislabelling as ‘environmentally friendly’, underreporting disclosures) and must pay out compensation to customers/investors.
  • Misreading the transition: a corporate is sued on the basis that it continued to sell a carbon-intensive product while in knowledge it would become redundant due to government net-zero policy, they must refund and compensate customers.
  • Indirect casual contribution (related to exposure to Utilities sector only): utilities are sued for their indirect contribution to climate change which amplifies physical risks due to inadequate or negligent preparation.
  • Directors’ breach of fiduciary duties (related to cover against asset managers only): investors of an asset manager allege that the entity’s directors have understated the physical and/or transition risk to their assets in their disclosures. Investors seek payment for damages from the directors’ breach of fiduciary duty.
  • Indirect causal contribution (financing): a case is brought against financiers of carbon-intensive activities, as they have contributed indirectly to manmade climate change through financing activities of carbon majors.

                                                  Taken from Table 1 of Box C of the CBES Results

Following engagement with members of the insurance market, the BoE identified that (in aggregate) just under half of the D&O insurance policies currently in place would cover these types of litigation risk; while approximately a quarter of the professional indemnity policies would cover climate related litigation. The respondents noted that this figure may not reflect coverage of the defendant’s own legal costs, which could often be high, particularly where the claims were investor-led.

While the focus of these questions was on the impact to the insurance industry of the developing trend, the analysis should focus the minds of banks and asset managers: have they sufficiently considered their litigation risk? Have they considered whether their policy coverage is adequate? As we move forward, have they budgeted for the increasing cost of Profin and D&O insurance which may arise from developing trends in this area?

What next

  • The BoE’s work on climate scenario analysis, including that done as part of the CBES, provides a key tool supporting firms and policymakers as they navigate uncertainty over future climate policy and climate change, enabling assessment against a range of possible outcomes.
  • As set out in the PRA’s October 2021 Climate Change Adaptation Report, the PRA and the BoE are undertaking further analysis to determine whether changes need to be made to the design, use, or calibration of the regulatory capital frameworks.
  • To support this work on the capital framework, the BoE will host a research conference on the interaction between climate change and capital in Q4 2022, and has already put out a ‘Call for Papers’. The BoE will publish follow-up material on the use of capital, including on the role of any future scenario exercises, informed by the conference and the findings of the CBES.
  • While no future CBES has been announced, it is clear that more work is needed before the BoE and market participants understand the stress that they may soon be under as a result of climate risks.
Simon Clarke
Simon Clarke
Partner
+44 20 7466 2508
Sousan Gorji
Sousan Gorji
Senior Associate
+44 20 7466 2750
Eleanor Dole Sheaf
Eleanor Dole Sheaf
Associate
+44 20 7466 7612

Herbert Smith Freehills contributes chapter to The Securities Litigation Review (8th Edition)

Herbert Smith Freehills have contributed the England and Wales chapter of The Securities Litigation Review. Now in its eighth edition, The Securities Litigation Review is a guided introduction to the class action regimes for securities claims in the key jurisdictions across the globe, providing a valuable resource for corporates and financial institutions who might face such claims.

Download chapter

Reproduced with permission from Law Business Research Ltd. This article was first published in May 2022. For further information please contact Nick.Barette@thelawreviews.co.uk.

Previous Editions:

7th edition 2021

6th edition 2020

5th edition, 2019

4th edition, 2018

3rd edition, 2017

Harry Edwards
Harry Edwards
Partner
+61 3 9288 1821
Jon Ford
Jon Ford
Senior Associate
+44 20 7466 2539