Banking and Finance Law Articles
Articles written by attorneys and experts worldwide
discussing legal aspects related to Banking and Finance.
On March 8, 2013, the Securities and Exchange Commission (the “SEC”) charged Brian Reiss, a California securities lawyer, with churning out baseless legal opinions for penny stocks traded on the OTC Markets platform.
The Securities Act of 1933 (the “Securities Act”) provides for a private offering or private placement exemption from federal securities registration which is increasingly being used by both public companies and private companies seeking to go public to raise capital during market downturns and in times of market uncertainty.
On March 7, 2013, the Financial Industry Regulatory Authority (“FINRA”) barred Jeffrey Rubin of Lighthouse Point, Florida, from the securities industry.
Familiar to everyone in connection with real property, squatting consists of occupying an abandoned or empty property that the squatter does not have lawful permission to use.
The Investment Services Act (CHAP. 370 of the laws of Malta) currently defines collective investment schemes as arrangements which, inter alia, “operate according to the principle of risk spreading”. By virtue of this definition, the requirement of risk spreading has been imposed on all licensed collective investment schemes alike and this irrespective of the type of collective investment scheme licence.
It has become routine for public companies and private companies seeking to go public to place restrictive legends (“Restrictive Legends” on the certificates representing their Restricted Securities not covered by a registration statement under the Securities Act of 1933, as amended (the “Securities Act”).
A Wells Notice is sent to subjects of a Securities and Exchange Commission (“SEC”) investigation when Enforcement staff has substantially completed its investigation and intends to recommend that an enforcement be pursued.
The author answers the most frequently asked questions on OTC Pink Current Disclosures.
The author answers the most common questions on Form S-8.
Short selling can be a legitimate trading strategy. It is often endorsed for its beneficial effects on the securities markets, which include increasing liquidity. It is also criticized. Short sellers profit by identifying companies that are weak or overvalued, and companies whose shares have been manipulated to rise to artificially high share prices.
SEC Charges Laidlaw and Its CEO for Securities Violations
Recent SEC amendments to FINRA Rule 6440, grant authority for FINRA to initiate trading and quotation halts in OTC equity securities when it is deemed necessary to protect investors. As amended, Rule 6440 grants FINRA the authority to impose foreign regulatory halts, derivative halts and extraordinary halts.
The author answers the most common questions on Rule 144.
Corporate hijackings of public shell companies–also called corporate identity theft–has been around for more than two decades. The public companies taken over in hijackings have become a valuable assets for shell peddlers (frequently securities lawyers & accountants) seeking reverse merger companies for their clients. They have also become a new target for the SEC.
How FINRA Rule 6490 lmpacts Reverse Mergers
The securities laws provide numerous benefits to issuers who qualify as foreign private issuers including but not limited to reduced disclosure obligations and relaxed financial statement requirements.
Foreign private issuers may raise capital in the U.S. using an offering registered on a registration statement under the Securities Act or by selling securities that are exempt from the SEC’s registration requirements.
On June 10, 2013, the Securities and Exchange Commission (the “SEC”)announced that it had suspended the trading in the securities of Polar Petroleum Corp. a company quoted on the OTC Markets with the symbol POLR.
Private companies in going public transactions that intend to be quoted on the OTC Markets OTCQB must first become reporting with the Securities and Exchange Commission (the “SEC”). This is typically accomplished by the private company filing a Form S-1 registration statement under the Securities Act of 1933, as amended (the “Securities Act”).
The Supreme Court on Friday, 7 of March, delivered its long-awaited decision with regard to the appeals lodged by Laiki’s and BoC’s depositors who lost part of their money in the €10 billion bail-in plan for Cyprus. More than 3.000 appeals of uninsured depositors were filed before the Supreme Court requesting the decision to be revoked.
An investment company with variable share capital (“SICAV”) is by far the most common vehicle utilised by promoters for the licensing of Collective Investment Schemes in Malta. This is attributable to the flexibility associated with such vehicles, as provided by the Companies Act (Investment Companies with Variable Share Capital) Regulations (the “Regulations”).
The judicial proceedings against the haircut on Laiki and Bank of Cyprus’ depositors are ongoing. The objective of the applications filed for judicial review is to annul the governmental decrees by which deposits in excess of €100.000 in Laiki and BoC were subjected to massive reductions.
Law 67 implements a multiple institutional coordination and cooperation system between regulatory entities as a multilateral board that gathers Panamanian regulatory government agencies.
A registered agent shall at all times retain physical possession of the bearer shares certificate, whether he deals directly with the end-user customer or with a professional intermediary customer.
MFSA Publishes a Self-Assessment Questionnaires for Fund Managers & Self-Managed Collective Investment Schemes - Malta
In view of the AIFMD coming into force on 22nd July 2013, Category 2 Licence Holders authorised to provide investment management services to collective investment schemes; Self-Managed Retail Non-UCITS Schemes; and Professional Investor Schemes licensed in terms of the Investment Services Act, 1994 (the “Act”), will be issued with a revised licence to operate as AlFMs, unless they opt for the ‘de minimis’ classification in accordance with the provisions of the AIFMD.
In few months the Rules of the game for Panamanian Corporations could be changed.
Several banking giants, such as HSBC and Standard Chartered, are currently being investigated by US regulators for alleged failings in anti-money laundering (AML) compliance. All fingers point to lapses involving outsourcing units operating without adequate oversight.
The authors offer an overview of the process to obtain a bank account in Panama.
On the 16th April 2013, Fitch Ratings issued a statement regarding a special report published by Fitch, highlighting the main differences between the Maltese and Cypriot banking systems and concluded that these differences far outweigh the similarities and that, as such, ‘Malta Does Not Face Same Bank System Risks as Cyprus’ meaning the Maltese banking sector does not present the same level of risk to the sovereign that was seen in Cyprus.
Stability is important to consider when you decide to open an offshore bank account…Why Panama?
Here is a quick outline to help you avoid personal liability from your business. You’ll see that most of the authors advice derives from an informed use of corporations and corporate law, which is why…
On 27th March 2013, the Permanent Representatives Committee approved the compromise text on the Capital Requirements Directive, better known as the “CRD 4” package proposed to amend and replace the existing rules on capital requirements, applicable to banks and certain investment firms. The new proposals come in the form of a Directive that governs access to deposit-taking activities and a Regulation that establishes the prudential requirements that institutions need to respect.
While banks and other financial institutions are already preparing for the introduction of FATCA, the system is less commonly known by banking clients. The objective of this article is to summarise the most important changes and decision points the introduction of the FATCA system will mean to clients holding their bank accounts with non-US banks.
On the 22nd March 2013, the Malta Financial Services Authority (MFSA) issued a Consultation Document on the proposed rulebook applicable to De Minimis Licence Holders in terms of Article 3 of the Alternative Investment Fund Managers Directive (‘AIFMD’), which provides for exemptions and lays the foundations for the said de minimis regime.
A brief overview of the emergency measures approved by the Cypriot parlament in relation to the banking sector.
This article is a comparative study which points the differences between the Law on Financial Leasing, Factoring and Financing Companies and the repealed Financial Leasing Law.
Cyprus is struggling with the worst crisis in its history since the 1974 invasion by Turkish military forces that divided the country in two.
OHADA is the Organisation for the Harmonisation of Business Law in Africa. With this law, doing business has become secured in 17th African members countries including the DR. Congo. This has many advantages not only for local economic operators but also for foreign investors who wish to invest in the OHADA states such as the Democratic Republic of Congo.
Saudi economist warned that the defaulting tendency would only worsen unless the local and global economy made a rapid recovery. He, however, expressed satisfaction over the present practice of banks to set tough conditions for granting loans.
Chasing payment of dues is a mundane yet critical element of every business process. Hugely time consuming, it could expose any activity large or small to counter-party risk, even more so in times of economic crisis.
Many investors have been "left out in the cold," so to speak, after they were left holding an unsalable product they were told was safe, secure, and "as good as cash." Investors were told that Schwab's Auction Rate Securities (ARS) were both liquid and safe when they were anything but. The economy's collapse in 2008 left investors out in the cold;t these illiquid assets could no longer be touched and they were in assets worthless.
In October 2012, the Hong Kong Stock Exchange (“HKEx”) published two guidance letters on Pre-IPO investments and Pre-IPO investment in convertible instrument respectively. The purpose of the two guidance letters is to consolidate previous HKEx’s listing decisions on Pre-IPO investments and to set out its current practice when dealing with convertible instruments issued to Pre-IPO investors.
The Malta Financial Services Authority has issued a Circular addressed to the investment services industry regarding the Prevention of Money Laundering and Funding of Terrorism (Amendment) Regulations 2009, following the revision of Part I of the Implementing Procedures which changes are being introduced through the inclusion of a new Chapter 9 and additional paragraphs to Section 6.1 of the Implementing Procedures.
On 8th February 2013, the International Organization of Securities Commissions (IOSCO) published a consultation paper on recommendations regarding the protection of client assets – Consultation Report CR02/13.
New York City is known as the nation capital for federal securities and investment fraud investigations and prosecutions. The most common claims in arbitration filed in New York include Breach of Fiduciary Duty, Negligence, Fraud/Misrepresentation, Failure to Supervise and Breach of Contract.
On 19 October 2012, the FATF (Financial Action Task Force) has decided to suspend Turkey’s membership on 22 February 2013 unless the following conditions are met before that date: (1) Turkey adopts legislation to adequately remedy deficiencies in its terrorist financing offence; and (2) Turkey establishes an adequate legal framework for identifying and freezing terrorist assets consistent with the FATF Recommendations.
Banking Business and Conditions of Approval of a Financial Institution in the Democratic Republic of Congo
This article discusses conditions conditions of approval of a Financial Institution in the Democratic Republic of Congo and how to open a bank in that country.
By Cai & Lenard
Multilateral Investment Guarantee Agency (MIGA) provided guarantees for funding in Ukraine
PLLCs (Professional Service Limited Liability Companies) are a popular choice for professionals in New York wishing to conduct business.
This paper seeks to discuss the hotly debated topic of customer identification program.
Are you worried about an Internal Revenue Service (IRS) tax audit? Does that worry make you keep records too long and clutter your living quarters? If a mountain of financially related documents is threatening to overwhelm your space and your sanity, it is time to de-stress.
On the 3rd of July, 2012, the European Commission adopted a proposal for the revision of the Insurance Mediation Directive (“IMD”) which is part of a wider legislative package focusing on consumer protection related issues.
A new regulation has been promulgated in the Official Gazette dated December 8, 2012, numbered 28491, which determine the criteria for permission to operate at Istanbul Stock Exchange (“Stock Exchange”), and the liabilities of the members. The regulation is highly functional as it is in line with the principles of corporate governance in the new Turkish Commercial Law.
The Financial Services Chief of the European Union Michael Barnier declared on the 27th November 2012 that credit rating agencies are to follow stricter rules so as to make them accountable for mistakes in case of negligence or intent.
A judgment may be enforced in the Country or State of its origin. Obtaining a judgment in Country A and having to enforce it in Country B, as the debtor has its assets in that Country isn't that easy as a legal decision of a foreign State will not automatically be accepted as a legal title. Most of the time (and unless treaties have been signed to facilitate things) it will be necessary to obtain a decision of the other Country. This is called the EXEQUATUR of a foreign decision.
By Amaris Law
In August 2012, the Ministry of Commerce of PRC (COFCOM) has issued the Regulatory Requirements on the Pawn Industry (draft) for collecting opinions from the public (“Requirements”). Such Requirements tighten the control on the regulations of Pawn Industry. However, in view of the rapid growth of such an industry in recent years, this article will discuss the chance, feasibility and way of foreign investments entering this industry and sharing its prosperity.
Small Businesses are very important to our economy. Easing their burden will certainly help economic growth. Current Rules of DTCC that provide remedies for SBs, supposedly enforced by the SEC, are not enforced, and this is having an immediate impact on SBs everywhere. This article points out these flaws and appeals for simple enforcement of existing rules so that SBs will not continue to be hamstrung or destroyed in the marketplace.
According to a Circular issued by the Malta Financial Services Authority (MFSA) on the 30th October 2012, addressed to the investment services industry, the MFSA is in the process of finalising the relative rules on cross sub-fund investments to be included in the Investment Services Rules for Professional Investor Funds.
Malta’s position within the financial services, gaming and aviation sectors, is further bolstered by the newly introduced 15% flat tax rate on; income derived from employment in Malta, by persons not domiciled in Malta and working in either of the ‘eligible offices’ as defined by the HQP Rules. With a minimum annual tax payable of € 11,250, equating to a 15% tax rate being applied to an income of € 75,000, tax planning has become a lot simpler.
Financial Services Authority or commonly abbreviated as OJK, is an independent institution and free from the intervention of other party, which has the functions, duties, and authority to regulate, supervise, examine, and investigate against the activities in the financial services sector, which are the activities in banking, capital markets, insurance, pension funds, funding institutions and other financial service institutions.
By Zorlu Law
Examining Contracts Arising Under the Commercial Credit Transaction (Letter Of Credit) Commercial credits are most commonly used in the international transactions areas. Its main future is that; it gives security both the exporter (seller) and the importer (buyer). The Seller knows that, he will get paid if he completes his duty properly. The buyer, on the other hand, can ensure to part his money before the goods are received.
The communiqué on principles of registered capital system in non-public companies has been declared by the Ministry of Customs and Trade (hereafter the “Ministry”) and published on the Official Gazette dated 19 October 2012. The revolutionary communiqué brings out new corporate responsibilities for non public companies having registered capital system.
The recent economic downturn have resulted in many of us tightening our belts. For most of us, this means having to forgo our annual overseas holidays, having to downgrade from going to restaurants to having our family meals at food court. Everyone is looking for ways to reduce their spending. We often overlook the very obvious method (and also substantial) savings through refinancing.
Have you ever considered whether or not your business could continue without you or your key employees? “Keyman Insurance” is an insurance policy designed to financially protect a business from the effects of prolonged illness or death of important employees of a business. Read this article to find out how your business can benefit from keyman insurance.
The Legal Requirements for Incorporation / Registration / Formation and Operation of a Company in Uganda
The legal requirements for the incorporation / registration / formation of a company in Uganda are contained in the Companies Act Cap 110 laws of Uganda 2000 edition. The registration/ formation and management of companies are governed by the companies Act and several other laws such as the Investment Code Act, The income tax Act, Value Added Tax Act, Uganda Citizenship and Immigration Control Act, National Social Security Fund Act among others.
In October 2012, the Maltese Government has issued a special tax status for retirees from EU, EEA countries and Switzerland when remitting their pension into Malta. A fixed tax rate of 15% will be due on the pension remitted, and the minimum tax payable shall be of €7,500 for the beneficiary and €500 for every dependant (if any).
Nursing home costs are rising, which could be detrimental to your financial health should you find yourself in need of nursing home care, or even that of an assisted living community. In fact, the average annual cost for a nursing home is running around $75,000 per person. Having insurance won’t be much of a help since most insurance plans do not cover the costs associated with a nursing home.
There are lots and lots of offer in compromise companies advertising to get your money and in return have you pay “pennies on the dollar” to resolve your tax liability. This post reviews the real facts underlying how the offer in compromise process really works. First we’ll take a look at getting your offer in compromise based on economic hardship. We’ll examine just what this means in the offer in compromise arena.
In order to maintain the integrity of Hong Kong stock market and to ensure a fair and informed market, a new Part XIVA of the Securities and Futures Ordinance (“SFO”) which imposes new statutory obligations on listed corporations and their officers to disclose price sensitive information (“PSI”) to the public will come into effect on 1 January 2013.
Operating a successful business in Jamaica is difficult. Therefore, protecting your business requires the skillful and balanced use of legal and non-legal advisers at all times. Bottom line, lawyers are indispensable to avoid litigation, wasting time and financial resources, damaged brand, protecting intellectual assets, protection of trade secrets, and governmental fines. Positively, your business could be placed in a position to reap many value enhancing benefits.
It is nice to be able to achieve multiple objectives through a single action and in many cases this can be done in the financial planning field. For those who are seeking asset protection, income, and estate tax benefits, Alaska trusts may be just one of these very efficient multipurpose tools.
Turkey, even restructured its banking sector several times, has still not made sufficient progress in money laundering and compliance legislation for improvement of the inspection obligations. In particular due to its location bridging Europe to Asia attracts the foreign criminal organizations of migrant smuggling, terrorism and narcotics. Turkey hosted many brass plate companies in the past set for the purpose of placement, layering and integration of laundering transactions by 1990s.
The Depositor Compensation Scheme (“DCS”) has been in force since 2003 through Legal Notice 369 of 2003, following the transposition of the EU Directive 94/19/EC on Depositor Guarantee Scheme obligations amended by EU Directive 2009/14/EC, with the scope to provide a rescue fund for depositors of failed banks licensed by the Malta Financial Services Authority (“MFSA”).
A Q&A guide to venture capital law in Switzerland which gives a high level overview of the venture capital market; tax incentives; fund structures; fund formation and regulation; investor protection; founder and employee incentivisation and exits. This article was first published in the PLC Multi-jurisdictional guide to Venture Capital Law 2012 and is reproduced with the permission of the publisher, Practical Law Company.
Time estimated to set up a WOFE in the Free Trade Zone in Shanghai: 2 to 3 months. I - Investors - Individual or corporation from foreign countries or China Hong Kong, Macao and Taiwan. No special requirement. II - New Company Name - Chinese Name: ***** International Trading (Shanghai) Co., Ltd English Name: no limit.
This article is an attempt to illuminate both the rudimentary and nuanced strategies required to consistently produce high-quality video depositions. I often worry that attorneys who order them are unaware that the footage for which they have paid dearly, is of exceedingly poor production value. The bottom line: all video depositions should look nearly identical (except for the witness, of course); it is the means by which that end is achieved that separates excellence from inferiority.
An analysis of a fund's side letters and guidelines to the parties that should be involved. The Grand Court of the Cayman Islands recently ruled on the enforceability of side letters in the case of Medley Opportunity Fund Ltd. v. Fintan Master Fund Ltd & Nautical Nominees Ltd (21 June 2012) and in so doing has emphasized a number of points to bear in mind when entering into side letters.
This article summarizes what should a non-Turkish company should do in order to open a bank account in Turkey. Business has been truly global for years. Nowadays, any company having a computer with an internet connection is theoretically capable of doing business worldwide. In such a world, Turkey, with its strategic geographical position, may instantly become a commercial hub for many companies having no presence in it.
MFSA Consultation Procedure on the Proposed Transposition of Certain Requirements of the AIFMD - Malta
On the 3rd September 2012, the MFSA issued a ‘Consultation on the proposed transposition of certain requirements of the Alternative Investment Fund Managers Directive’ (“AIFMD”) that regulates the activity of alternative investment fund managers.
The board of directors play a central role in any offshore hedge fund. At every stage of the life cycle of a hedge fund the directors need certain critical information and documents in order to perform their duties. The life cycle can roughly be determined as the fund formation stage, the post launch operation (which might last several years) and then the eventual liquidation.
This article provides an overview of the Turkish tobacco legislation. Law No. 4733 Regarding the Organization and Duties of the Tobacco and Alcohol Market Regulatory Authority (the “Law”) sets forth the general principles applicable in four markets in Turkey, which are (i) tobacco market, (ii) tobacco products market, (iii) alcohol market and (iv) alcoholic beverages market.
The most recent EU Summit held in June 2012 saw the creation of a tentative action aimed at addressing the current problems with bad banks and grossly indebted governments. This is currently being called the “Banking Union Plan”.
The global retailing giant Walmart announced in February that it would further acquire 33.6% interest in Yihaodian, a leading B2C e-commerce company in China. Before the investment, Walmart already held 17.7% interest in Yihaodian. The new deal is subject to government regulatory approvals, including antitrust approval from the Chinese anti-monopoly regulator, the Ministry of Commerce (“MOFCOM”). On 13 August 2012, Walmart announced that it has received conditional approval from MOFCOM.
There are differences between bankruptcy and loss mitigation when it comes to solving your mortgage problems. A Broward County foreclosure attorney explains. When you are facing foreclosure, you may consider alternative measures such as bankruptcy or loss mitigation. It is important to understand the differences in evaluating which option might be best for you.
Some of the largest hedge fund managers will shortly make their initial filing for the Form PF, on August 29, 2012. This guide will recap on the previously announced and finalized Form PF obligations and provide an update on the most recent developments.
MOU With Financial Intelligence Unit of Netherlands on Prevention of Money Laundering and Terrorist Financing - Turkey
The Memorandum of Understanding (MoU) between Ministry of Finance, Financial Crimes Investigation Board (MASAK) of the Republic of Turkey and Financial Intelligence Unit of Netherlands concerning cooperation in exchange of financial intelligence related to money laundering and terrorism financing has been published on official gazette of 15 August 2012.
Hedge funds are increasingly subject to international and local data protection regulations. The amount of personal data held by hedge funds and service providers continues to grow. As obligations to collect data increases with new regulations such as FATCA hedge fund managers and other service providers must pay attention to data protection laws and regulations.
Romania has recently passed into law, Law no. 148/2012 which establishes the legal framework for the issuing of electronic documents (invoices, tax bills, receipts) which will contain data regarding economic operations such as exchange or sale of goods or services. This is a further step to modernise the financial and banking system in Romania. As electronic commerce continues to expand Romania will continue to be at the fore front of this industry.
The CFTC has issued a no action letter providing temporary relief for Commodity Pool Operators (CPOs) and Commodity Trading Advisors (CTAs) who are affected by the recent changes to the CFTC registration exemptions. The no action letter extends the deadline for registration for those affected by the recission of CFTC Rule 4.13(a)(4) and the amended Rule 4.5.
Introduction, Small Business and Southern Europe’s Economic problems. Because my Arizona business law firm represents businesses and start ups, both locally and from around the world, I was curious about the role entrepreneurs, start ups, and small and medium size businesses play in their national economies around the world. Surprisingly, one of the first articles that I found attributed the financial problems of Greece, Italy and Spain,.....
The general principle on dissolution of Limited Liability Company is stipulated under Article 143 paragraph (1) of Law No. 40 of 2007 regarding Limited Liability Company, which provides that the dissolution of company does not automatically erase the legal status of the company. The legal status would be lost at the end of the liquidation process and accountability of liquidator has been accepted by the General Meeting of Shareholder or District Court.
Estate planners often talk about creating the plan that meets the specific needs of the individuals they are advising. They ask what you want and give you choices about how to get what you want. However, let's step back and look at the bigger picture. Estate planning is not only about you. It's also about your family and other loved ones.
Michael Barnier, the Commissioner for the single market is expected to propose serious changes to the market abuse directive (2003/6/EC) and the proposed regulation ‘on insider dealing and market manipulation’ in the near future.
Pursuant to article 20 of the Malta Financial Services Authority Act (Chapter 330 of the Laws of Malta), the MFSA is required to appoint a Consumer Complaints Manager (“CCM”) empowered to investigate complaints from private consumers (as opposed to companies or enterprises) in connection with any financial services transaction involving a financial entity regulated by the MFSA...
Malta has come a long way since it first gained its Qualifying Recognized Overseas Pension Schemes (“QROPS”) status from the UK HM Revenue and Customs (“HMRC”) in 2009. Since then Malta has rapidly established a reputation as a safe and robust QROPS domicile. As will be seen below, various factors have proved pivotal in allowing Malta to benefit from a steadily growing slice of the QROPS market.
Bankruptcy is a viable option if you cannot pay your debts and support your family. If creditors are calling you at home and at work, writing you threatening letters or even filing suit against you, a bankruptcy filing can stop these things and give you breathing room to begin a fresh start.
There are individuals who are naturally more exposed to potential legal actions than others, and for these people asset protection should be a priority. You have to act in advance to preserve your assets because your hands are tied once a suit is initiated.
Turkish Parliament has adopted a new law, Law No 6322 that brings out a limitation to financial expenses to corporate and income taxpayers. Accordingly, amounts including but not limited to credit interest, foreign exchange losses i.e. as a part of financial charges that exceed the equity capital and not a part of investment expenses shall not be determined as financial expenses and be written off as of 01 January 2013.
The Cayman Islands Court of Appeal has re-affirmed the distinction between segregated portfolio companies (“SPCs”) and their segregated portfolios and the insolvency implications for each. In ABC Company (SPC) v J & Co. Ltd (CICA Unreported, May 2012) the Court of Appeal re-affirmed that the insolvency of one segregated portfolio in an SPC will not impact the other segregated portfolios in that SPC so as to require a winding up order to be made over the SPC as a whole.
Please highlight any main trends or shifts in the current Ukrainian financing market? Due to limited or no appetite for Ukrainian risk and global finance markets volatility, capital markets and traditional bank lending are no longer easily accessible to Ukrainian borrowers (subject to few exceptions). At the same time, supply of ECA-backed trade financing continues to be available and trade financing seems to be active this year as well.