On April 5, 2012, President Obama signed the Jumpstart Our Business Startups Act ("JOBS Act" or the "Act") into law. While the Act and recent commentary have focused primarily on common equity issuances by "Emerging Growth Companies" (or "EGCs"), the JOBS Act also impacts companies that have issued only debt securities in registered transactions, typically pursuant to an "A/B" exchange for privately offered high-yield debt securities.
Client Alert | April 23, 2012
To update our alert of March 28, President Obama signed the Jumpstart Our Business Startups Act ("JOBS Act") into law today. We believe the JOBS Act is the most significant modernization of the federal securities laws since the Securities and Exchange Commission's 2005 Securities Offering Reform.
Client Alert | April 5, 2012
On March 27, 2012, the House passed the Jumpstart Our Business Startups Act ("JOBS Act"), as amended and passed by the Senate on March 22. It is widely anticipated that President Obama will quickly sign the JOBS Act into law.
Client Alert | March 28, 2012
On March 19, 2012, the Securities and Exchange Commission ("SEC") announced that it had credited the substantial cooperation of a former senior executive of an investment adviser in an investigation by declining to take enforcement action against him. The SEC's announcement can be found here. This is the first time the SEC has publicly recognized the cooperation of an individual since the announcement two years ago of its policy statement intended to incentivize individuals to cooperate in investigations, found here. This announcement provides some much needed insight into the potential benefits of cooperating in an SEC investigation. However, the unique facts of the case mean that it will have limited application to other cases.I. SEC's
Client Alert | March 20, 2012
In an unprecedented move, the Controller of Patents in India ("Controller") issued the first compulsory license under the Indian patent regime, since the Patent Act, 1970 ("Act") was amended in 2005 to permit product patents in India.
Client Alert | March 20, 2012
I. IntroductionThe most significant impact of SEC registration on private fund advisers is that the adviser becomes subject to inspection by the SEC's Office of Compliance Inspections and Examinations (OCIE). The greatest risk arising from an examination is that the inspection staff decides to refer finding from an inspection to the Division of Enforcement for an investigation. This article discusses the risks of an examination becoming an investigation and strategies for anticipating and mitigating those risks. II. The Risk That an Examination Results in a Referral to EnforcementAsset managers are particularly vulnerable to collateral consequences of a government investigation. Particularly in the wake of recent cases, many investors have l
Client Alert | March 6, 2012
Fines Imposed by UK Financial Services Authority Illustrate Differences between US and UK Market Abuse Regimes The UK Financial Services Authority ("FSA") imposed fines of £3.651 million ($5.77 million) on Greenlight Capital Inc., a US hedge fund manager ("Greenlight"), £3.638 million ($5.74 million) on David Einhorn, Greenlight's owner, and £350,000 ($553,000) on Andrew Osborne, a former Bank of America Merrill Lynch banker. These fines were levied in connection with Greenlight's trading in the shares of Punch Taverns Plc ("Punch"), a UK pubs business, ahead of a planned equity offering. The FSA imposed the fines on the grounds that Greenlight traded on inside information conveyed to David Einhorn during a conference call with Punch's CEO and A
Client Alert | March 5, 2012
The Hiring Incentives to Restore Employment Act (the HIRE Act), enacted in 2010, contained provisions (now commonly referred to as FATCA) intended to reduce the evasion of U.S.
Client Alert | February 9, 2012
On January 10, 2012, the Department of Industrial Policy and Promotion, Ministry of Commerce and Industry, Government of India, issued a press note amending the Consolidated Foreign Direct Investment ("FDI") Policy of October 2011 ("Amendment"). AmendmentThe Amendment allows up to 100% FDI in single-brand product retail trading with the prior approval of the Government of India, increased from a previous 51%, subject to the following conditions: Single-brand only: Products to be sold should be of a 'Single-Brand' only; International brand: Products should be sold under the same brand in one or more countries other than India; Branded during manufacturing: Single-brand product retail trading only covers products which are branded dur
Client Alert | January 26, 2012
The Supreme Court of India ("Supreme Court") on January 20, 2012 has overturned a 2010 decision of the Bombay High Court which ruled that Vodafone was liable to pay $2 billion to the Indian tax authorities because Indian capital gains taxes applied on share transfers between two non-resident entities, as long as the underlying assets transferred were within India.The case in question involved Vodafone International Holdings BV's acquisition of CGP Investments from Hutchison Telecommunication International Limited ("HTIL"). HTIL, a company incorporated in BVI, owned CGP Investments, a company incorporated in Cayman Islands, which through its Mauritius subsidiaries owned and/or controlled approximately 67% of one of India's leading mobile phone operators - Vodafone
Client Alert | January 20, 2012
As from January 1st, 2012, the French Finance Act has significantly increased the transfer tax applicable to the transfer of shares of non-real estate companies.BackgroundBefore the reform, transfer tax at the rate of 3% was due on the sale of shares of French companies, with the tax capped at € 5,000 per transfer with respect to the transfer of shares in sociétés par action (i.e.
Client Alert | January 20, 2012
Over the past ten years, Indonesia's commercial banking sector has been an attractive destination for foreign investors. This has been in large part due to the Indonesian government's relaxed banking policy, which until now has been geared towards fostering foreign investment in the industry. A proposed amendment to the banking policy, however, may have significant consequences for current and potential investors.Following the 1997 Asian financial crisis, the Indonesian government enacted Government Regulation No.
Client Alert | January 19, 2012
While the members of the Eurozone are still struggling to find an adequate answer to the sovereign debt crisis and the stock markets are on a roller-coaster ride, the German economy is still doing remarkably well and continues to attract foreign investors from all over the world, notably China. At the same time, German lawmakers have not remained idle and have enacted a long-expected reform of the insolvency laws to facilitate corporate restructuring and debt-equity swaps.
Client Alert | January 10, 2012
Paris partners Jérôme Delaurière and Ariel Harroch are the authors of "De la nouvelle réforme des règles de lutte contre la sous-capitalisation" [PDF] published on January 9, 2012 in La Lettre Capital Finance, issue 1044, page 12 (www.capitalfinance.eu).
Client Alert | January 9, 2012
San Francisco of counsel Winston Chan and associate Kareem Ghanem are the authors of "The New Dodd-Frank Whistleblower Provisions: A primer for private equity firms" [PDF] appearing as Chapter 5 in The US Private Equity Fund Compliance Companion, published by Private Equity International in January 2012.
Client Alert | January 1, 2012
According to a reform applicable as of January 1, 2012, the right to deduct interest due with respect to the purchase of shares in French target companies will be denied, unless the French acquiring company demonstrates -- by any means -- that (i) the decisions relating to such shares and (ii) the control over the target companies are effectively made by it or by a related party established in France.For the purpose of this reform, a related party can be a controlling company or an entity controlled by or under common control with the acquiring company. This new rule targets the purchase of shareholdings that are eligible for the French long-term participation exemption regime, i.e.
Client Alert | December 22, 2011
Overview -- It's not just a numbers game ... Since overhauling its financial penalty framework in March 2010, the UK Financial Services Authority (FSA) has gone a long way to dispel views that it has a lacklustre approach towards levying market abuse fines.
Client Alert | December 6, 2011
London associate Edwin Wong is the author of "Power Play: Fundraising Conditions And PE Investment" [PDF] published by Law360 at www.law360.com on November 28, 2011.
Client Alert | November 28, 2011
On November 3, 2011, the IRS published new proposed Treasury Regulations providing guidance relating to the taxation of income of foreign governments from investments in the United States under Section 892 of the Internal Revenue Code of 1986, as amended (the "Code"). The proposals update regulations that were first issued in 1988, and are welcome additions to an area of U.S.
Client Alert | November 4, 2011
New York partner Rashida La Lande is the author of "Deals With Controlling Stockholders: 5 Tips for Boards" [PDF] published on November 2, 2011 on Boardmember.com.
Client Alert | November 2, 2011
On October 9, 2011, California Governor Jerry Brown signed into law competing bills that create two new corporate forms in California -- a "flexible purpose corporation" and a "benefit corporation" -- intended to allow entrepreneurs and investors the choice of organizing companies that can pursue both economic and social objectives. The new corporate forms differ from traditional for-profit corporations that are organized to pursue profit (and not social purposes) and non-profit corporations that must be used solely to promote social benefits. These laws will take effect on January 1, 2012. The flexible purpose corporation is created by California Senate Bill 201 ("SB 201"), which adds Division 1.5 to Title 1 of the California Corporations Co
Client Alert | October 25, 2011
On Tuesday, October 11, 2011, the Federal Reserve Board ("Fed") and the Office of the Comptroller of the Currency ("OCC") released for public comment and the Federal Deposit Insurance Corporation (the "FDIC") met in open session and unanimously approved and released proposed rules implementing the Volcker Rule, Section 619 of the Dodd-Frank Consumer Protection Act of 2010 ("Dodd-Frank"). The Securities and Exchange Commission ("SEC") voted unanimously to approve the proposed rule on Wednesday, October 12.
Client Alert | October 12, 2011
Enforcement of the Foreign Corrupt Practices Act has grown exponentially in recent years, and shows no signs of abating. The DOJ and SEC, the U.S.
Client Alert | September 21, 2011
On September 1, 2011, the Governor of California signed into law California Assembly Bill No. 571 ("AB 571"), which will liberalize and streamline the legal standards for California corporations and quasi-California corporations to make cash and property distributions to shareholders, including dividends and share repurchases and redemptions.
Client Alert | September 6, 2011
The Hiring Incentives to Restore Employment Act (the HIRE Act), in an effort to reduce the evasion of U.S.
Client Alert | August 9, 2011
On June 22, 2011, the Securities and Exchange Commission (the "SEC" or the "Commission") voted to adopt final rules to implement amendments to the Investment Advisers Act of 1940 (the "Advisers Act") contained in Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act ("Dodd-Frank"). Importantly, the Commission extended from July 21, 2011 to March 30, 2012 the deadline for registration for private fund advisers previously exempt under Section 203(b)(3) of the Advisers Act, which exempted from SEC registration investment advisers with fewer than 15 clients.As a result of this extension, the revised compliance dates generally applicable to investment advisers having to register for the first time are as follows:DateActionJ
Client Alert | July 18, 2011
The Indonesian House of Representatives on 31 May 2011 passed Law No.
Client Alert | July 15, 2011
On June 22, the SEC will meet to consider adopting final rules and rule amendments to implement the requirements of Title IV of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010. The Commission’s press release is available at http://sec.gov/news/openmeetings/2011/ssamtg062211.htm.Among other things, the SEC announced that it will consider final rulemaking related to:The statutory threshold for SEC registration of investment advisers;SEC registrations by advisers to hedge funds and other private funds;Reporting requirements for exempt private fund advisers;Exemptions for (a) venture capital fund advisers, (b) advisers to private funds with less than $150 million in private fund assets under management in the United States, (c) foreign private advisers; andExclusi
Client Alert | June 9, 2011
Printable PDF On March 29, 2011, the Federal Deposit Insurance Corporation (the "FDIC") and the Board of Governors of the Federal Reserve System (the "Fed") jointly released a notice of proposed rulemaking ("NPR") proposing rules relating to the resolution plan (also known as the "living will") and credit exposure report requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (the "DFA"). Both the resolution plan and credit exposure report requirements apply to nonbank financial companies ("NBFCs") designated by the Financial Stability Oversight Council (the "Council" or "FSOC") for Fed supervision and bank holding companies ("BHCs") (including any foreign ban
Client Alert | April 6, 2011
Printable PDFThe Panel Holds Its Ground -- An Analysis of Some of the Key Proposals Introduction -- The Panel Stands FirmIn late November 2010, we published an article on the policy statement of the UK Panel on Takeovers and Mergers (Panel) which set out the ground work for changes to the rules governing the conduct of public takeovers in the UK as embodied in the UK Code on Takeovers and Mergers (Code).
Client Alert | March 29, 2011
New York partner Rashida K. La Lande is the author of "Private Equity Strategies for Exiting a Leveraged Buyout" [PDF] published by the Practical Law Company in March 2011.
Client Alert | March 1, 2011
On February 11, 2011, the German Parliament approved the bill for the so-called "Investor Protection and Capital Markets Improvement Act" (Anlegerschutz- und Funktionsverbesserungsgesetz) which is part of the ongoing legislative activity responding to the financial crisis.
Client Alert | February 18, 2011
On January 11, 2011, the U.S. Securities and Exchange Commission ("SEC"), in consultation with the Department of the Treasury, Financial Crimes Enforcement Network ("FinCEN"), again extended the Bank Secrecy Act ("BSA") Customer Identification Program ("CIP") no-action letter (initially issued in 2004) relating to broker-dealer reliance on SEC registered investment advisers ("RIAs"). As previously, the extension was granted at the request of the Securities Industry and Financial Markets Association ("SIFMA").
Client Alert | February 17, 2011
Printable PDFOn January 18, 2011, the Financial Stability Oversight Council (the "Council") released a notice of proposed rulemaking ("NPR") that sets forth the proposed criteria and analytical framework for the Council to designate an entity as a nonbank financial company under the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "DFA"). Pursuant to the DFA, the Council has the authority to require that the Federal Reserve Board supervise a designated nonbank financial company and that the company be subject to prudential standards in accordance with Title I of the DFA.
Client Alert | January 20, 2011
The improvements in the German economy in 2010 have eased some of the restructuring pain, but have not prevented lawmakers from responding to certain deficiencies that are widely believed to have caused the financial crisis.
Client Alert | January 14, 2011
Printable PDFEnacted on July 21, 2010, the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act") comprehensively reforms and restructures the U.S.
Client Alert | January 13, 2011
On December 17, 2010, President Obama signed into law the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010 (the Act). The Act extends the existing individual income tax rates and a number of expiring credits and other benefits, provides a few new temporary tax incentives, and establishes new gift and estate tax rates and exemptions.Extension of Expiring Tax ProvisionsThe Act extends the current income rates (which reach a maximum marginal rate of 35%) through the end of 2012 for all taxpayers.
Client Alert | December 20, 2010
In the past three years, international regulatory focus on remuneration has gripped the globe. The heart of the debate which arose in the context of remuneration structures in investment banking and their contribution to global financial crisis has extended past this into remuneration across a broad range of industries.
Client Alert | December 20, 2010
On 1 June 2010 the UK Panel on Takeovers and Mergers (Panel), issued a 'Green' Consultation Paper on the Review of Certain Aspects of the Regulation of Takeover Bids in the UK (Green Paper).
Client Alert | November 24, 2010
The Hiring Incentives to Restore Employment Act (the HIRE Act), in an effort to reduce the evasion of U.S. tax obligations through the establishment of accounts at foreign financial institutions (FFIs) or by holding assets through other, nonfinancial foreign entities (NFFEs), included provisions commonly referred to as FATCA.
Client Alert | October 7, 2010
Rule 206(4)-7 under the Investment Advisers Act of 1940 (the "Advisers Act") requires registered investment advisers to adopt and implement written policies and procedures that are reasonably designed to prevent violations of the Advisers Act by the adviser and any of its supervised persons within the meaning of Advisers Act section 202(a)(25). The adviser's policies and procedures must also be reasonably designed to detect and promptly address any violations that occurred. Advisers Act Rule 206(4)-7(b) further requires investment advisers to undertake an annual review to determine the adequacy and effectiveness of their procedures in light of internal and external developments affecting the firm.In her article, "Assessing Your Risk Program: Is Your Review Curren
Client Alert | September 7, 2010
Printable PDFOn July 27, 2010, U.S. Securities and Exchange Commission ("SEC") Chairman Mary L.
Client Alert | July 28, 2010
On July 15, 2010, the Senate voted (60-39) to approve the Dodd-Frank Wall Street Reform and Consumer Protection Act (the "Act"), which is expected to be signed into law next week by President Obama. Included among the Act's sweeping changes to the regulation of the U.S.
Client Alert | July 16, 2010
This alert covers the Dodd-Frank Wall Street Reform and Consumer Protection Act and its "Volcker Rule" provisions, prior to its passage in 2010.
Client Alert | July 12, 2010
The American Jobs and Closing Tax Loopholes Act of 2010 (the "Bill") was passed by the House on May 28, 2010, and includes a provision that generally will tax a portion of the income and gains associated with "carried interests" as ordinary income. While the carried interest provisions of the Bill are substantially similar to legislation proposed last year, there are several important differences. The Senate is expected to take up the Bill during the week of June 7, after the Memorial Day recess.
Client Alert | May 28, 2010
On May 20, 2010, after three weeks of floor debate, five cloture votes, and nearly a year of development, the "Restoring American Financial Stability Act of 2010" passed the Senate by a vote of 59-39.
Client Alert | May 27, 2010
On May 18, 2010, and with effect as of May 19, 2010, 00:00 hrs CET, the German Federal Financial Supervisory Authority ("BaFin") temporarily prohibited uncovered short sales of debt securities of euro zone countries admitted on a German exchange to trading on the regulated market.
Client Alert | May 19, 2010
The continuing saga of the Alternative Investment Fund Managers Directive (the Directive) of the European Union is causing heartburn throughout the world's financial capitals.
Client Alert | May 19, 2010
After three and one-half years of litigation and an 18-day bench trial in San Francisco Superior Court, defendants Baker Capital, a private equity firm that invests in growth companies, and its related investment funds ("Baker"), achieved a complete victory against plaintiffs, former controlling stockholders, officers and directors of an internet retailer named Wine.com, Inc.
Client Alert | May 3, 2010
On March 22, 2010, a bill seeking general reform of financial industry regulation in response to the recent financial crisis was adopted on a party-line vote by the Senate Banking Committee as the "Restoring American Financial Stability Act of 2010." It subsequently was reported to the Senate as Senate Bill 3217 (posted on the Committee's website on April 15, 2010).
Client Alert | April 23, 2010