Please read attached Summary Note which explains the main changes made to the LMA's Primary Documents and the LMA Finance Party Default and Market Disruption Clauses for use in conjunction with the Primary Documents, which were published in December 2011.
The LMA's newsletter is out now; click here to download your copy. Articles include: Executive insight – interview with Stuart Popham, Vice Chairman EMEA at Citi; Economic outlook for 2012 by Charles Robertson, Global Chief Economist at Renaissance Capital; and a review of the speculative grade market in 2011 and an assessment of the challenges facing corporates in 2012 by Standard and Poor's.
The LMA has issued a press release regarding its concern that CRD IV is likely to have a negative impact on the syndicated loan market and may depress a vital sources of liquidity for borrowers. Click here to read in full.
It has come to our notice that there is some debate in the secondary loan market relating to the application of delayed settlement compensation. The LMA has issued the attached briefing note offering clarification.
The Foreign Account Tax Compliance Act ("FATCA") was signed by President Obama in 2010 with the purpose of countering offshore tax evasion. FATCA applies to all "foreign financial institutions" ("FFIs") - defined to include non-US banks, funds, securitisation vehicles and others. The principal effect of FATCA is that an FFI will be subject to a punitive 30% withholding on all US source income (including interest, principal, dividends and sale proceeds) unless the FFI signs an agreement with the IRS accepting complex reporting obligations in relation to direct and indirect US account-holders. Click here to read further
Given the current issues facing the Eurozone, there is more debate in the market on the provisions that define the currency of payment in facility agreements. This note clarifies that, as the LMA Facility Agreements contain no definition of the Euro, members using the LMA Facility Agreements will need to decided how that currency should be defined. Click here to read further.
There has been much recent media discussion around the possibility of a Eurozone member departing from the currency union and Clifford Chance have kindly authorised the LMA to publish its briefing note on this topic on the LMA website. The note addresses a number of questions in relation to loan documentation and has been posted on the new Briefing/Research Papers section on the website.
Suggested drafting when LIBOR /EURIBOR becomes negative. Please login to read the note in full.
The European Commission has proposed a new financial transaction tax (FTT) which applies a 0.1% charge on transactions in securities and other financial instruments and a 0.01% charge on the notional amount of derivative contracts, applying (in either case) if either party is an EU resident or is acting through an EU branch. To read further, please click here.