Arguably one of the most in demand expert witness roles, Criminal Investigations require an experienced and strategic expert. Here to talk to Lawyer Monthly about his expert witness role in this legal segment, and particularly about investigations surrounding vehicle collisions, is Michael P. Corrigan of Strange, Strange & Gardner.

Michael is employed in the firm’s Road Traffic Collision Investigation and Reconstruction Department. In this role he holds a Licentiateship from the City & Guilds in the area of Accident Investigation (LCGI) and is a member of the Institute of Traffic Accident Investigators (ITAI) and the Institute of Motor Industry (MIMI). Michael was a Serving Police Officer with the West Midlands Police Force for over 31 years and for the majority of the service was a Traffic Officer who specialised in the investigation/reconstruction of fatal/ serious road traffic collisions; this is where he received the majority of his training in this field.

Overall, what does the role of a collision investigation expert witness involve day to day?

At this time the majority of training in the area of road traffic collision investigation reconstruction is done by Police Forces and as a result the majority of collision investigators are retired Police Officers. There are now a number of courses becoming available in the area of road traffic collision investigation and reconstruction.

The role of a road traffic collision investigator and reconstruction forensic engineer can be split into two main sections, Criminal and Civil cases. My role in the criminal field is to assist Barristers and/or Solicitors where Defendants have been charged with a number of offences, which can range from Death by Dangerous Driving to Careless Driving.

The main role in the civil field is to prepare a Court compliant report into the circumstances of the material road traffic collision under consideration, the consistency of the damage in regard to the alleged circumstances, the likelihood of occupant displacement within the vehicle at the principal point of impact, and the wearing or otherwise of seatbelts.

All collision investigators are fully aware that their principal duty is to prepare a Court compliant report which is impartial to all of the parties CRIMINAL INVESTIGATIONS involved and not dependent upon the person placing the instructions or paying the professional fees.

How are these sorts of investigations carried out and how complex can they become?

In any investigation into a fatal/ serious road traffic collision it is dependent upon the level of experience and qualification of the Police Officers attending the initial scene and the collision investigator to record all of the available evidence at the scene. This type of evidence can be ephemeral marks, post-impact positions of the vehicles, debris fields and witness evidence. It is the duty of the collision investigator attending the scene to recall all evidence, some of which may not form part of the rationale of the material road traffic collision but has to be able to explain why certain points have been discounted within the final report.

In any case one of the primary obstacles in obtaining evidence at the scene would be the level at which this is recorded by the initial Police Officers and any subsequent collision investigator attending at a later date. This therefore becomes a problem whereby Police Forces are prioritising the attendance of collision investigators at road traffic collision scenes and this may result in evidence not readily appreciated by an untrained eye being lost and be unrecoverable at a later date. In criminal cases where a collision investigation expert is instructed by the Defence team it is dependent upon the quality of the recorded evidence and the availability which is one of the major problems in preparing a report within the timescales laid down by the Court.

In most cases where witnesses, drivers and passengers in the vehicle are available to give evidence this does assist in forming any opinions as to the like causes and the outcome of any pending Court cases. There are occasions where there are no witnesses available due to the areas where the collisions may have occurred and/or the parties involved which in some cases are deceased are not available to give detailed evidence of the collision circumstances. In this case it becomes paramount as to the quality and the amount of recorded evidence to fully assist in forming an opinion as to the likely movements of the vehicles leading up to the principal point of impact.

There are occasions when vehicles post-impact, in their damaged states, can be repositioned, then photographed, to show their relative orientation at the point of impact. This is then re-imposed within the road layout and from this opinions can be formed as to the likely circumstances and the driver that was at fault, and therefore the cause of the material road traffic collision.

What overall impact does your role have in insurance-related and civil disputes?

These types of investigations and reconstructions, where there are no available witnesses, do assist insurance companies in considering the likely outcome of any claims made by persons involved and/or the dependants of any person that may be deceased.

There are occasions when the investigation and reconstruction made by a collision investigator can identify a problem with a certain type of vehicle and as a result directions can be given in the operation of these vehicles. In one case it was a result of a fatal road traffic collision where the operation of the vehicle severely restricted the views available to the driver and as a result the fatal injuries were caused to the other party. Since that date I have noticed on seeing this type of vehicle being used that the same faults have not been made and as a result the driver’s views have not been similarly restricted and hopefully no further fatal road traffic collisions occurred. On a personal note I am aware that although it was never considered the driver’s fault, he never drove this type of vehicle again and had to change his employment.

In all investigations of fatal/serious road traffic collisions where there is no exact data or information as to the collision circumstances for example CCTV of the movement of the vehicles, it always comes down to the opinion of the collision investigator on consideration of all of the available evidence as to the causation of the material road traffic collision. In this case all collision investigators must be prepared to review and amend their discussions and conclusions stated within any report if additional information becomes available.

How does your role help specifically in the reconstruction of collision events through the use of technology? How are these reconstructions then evaluated by the Courts?

I am aware that a number of Police Forces in the United Kingdom have started to use 3D computer animation to show the movement of the vehicles during a road traffic collision. In preparing a 3D computer animation it is necessary that all of the available information at the collision scene has been fully recorded for example in the form of rolling tyre marks, skid marks and any gouge or surface marks to the road surface. These markings can be used to position the vehicle within any 3D computer animation with some accuracy in forming an opinion as to the likely movements.

It is a personal observation of mine that the use of 3D computer animation is solely based on the opinion of the person preparing the animation as to the movement of the vehicles during the material road traffic collision. It may be that a person(s) and/or collision investigator can verbally fully explain correctly how a collision occurred and then the alternative position is put by the use of an illprepared and incorrect computer animation, but because it is an animation and readily understood, it may be accepted as a more logical explanation.

On the matter of private investment funds, Lawyer Monthly hears from Nicholas Pattman, a Partner in the Global Investment Funds Group of Walkers in the Cayman Islands. Here Nicholas provides an overview of the benefits of listing investment funds and the process for listing them on the Cayman Islands Stock Exchange.

The Cayman Islands Stock Exchange

This year marks the twenty year anniversary of the passing of the Cayman Islands Stock Exchange Company Law which laid the foundations for the establishment of the Cayman Islands Stock Exchange (the ‘CSX’). Since then the CSX has grown rapidly to become one of the leading offshore exchanges with a current listed market value of approximately US$198 billion (of which approximately US$9 billion is represented by the listed securities of investment funds) providing facilities for listing and trading equity and debt securities in the Cayman Islands.

In addition to providing a primary listing and trading facility for products including investment funds, exchange traded funds (ETFs), specialist debt securities (such as asset backed, credit linked and loan participating notes) and insurance linked securities, the CSX also provides a secondary listing facility and offshore trading venue for securities listed and traded on another recognized exchange.

Benefits of Listing Investment Funds

The listing of investment funds, both open and closed-ended, can provide multiple benefits for fund managers and investors alike. The benefits, when combined with the pragmatic and business orientated approach adopted by the CSX, the speed with which a listing can be achieved as compared to other exchanges and the competitive initial and ongoing fees, make the Cayman Islands an attractive choice when considering the domicile for an investment fund and its eventual listing.

Some investors, in particular certain funds of funds or larger institutional investors, such as pension funds and endowments, may have restrictions or internal policies that prohibit an investment in unlisted fund securities or require that their portfolio hold a minimum percentage of listed securities and therefore the listing of a fund’s securities on the CSX could potentially increase its target investor base and provide access to an additional source of capital.

So too as fund investors seek ever more transparency when determining where to allocate their capital, listing the fund may provide investors with some comfort and a level of transparency and third party oversight which may enhance the marketability of the fund. Once listed on the CSX, the fund is obliged on an ongoing basis to publish its NAV per share on the CSX’s website. The availability of current and historic NAVs in turn means that investments can be easily marked to market.

A fund listing may also provide a variety of tax benefits, such as exemptions or lower rates, for its investors. Some jurisdictions, such as the UK and Japan for instance, can provide a more a favourable tax treatment if investors subject to their tax regime hold securities issued by funds that are listed on an internationally recognised stock exchange such as the CSX.

To the extent that the investment fund to be listed is open-ended and therefore falls within the definition of a “mutual fund” under the Mutual Funds Law of the Cayman Islands then consideration will also need to be given to the requirements of that law albeit, for instance, that the fund may be able to avail itself of certain exemptions if, among other things, its equity interests are listed on a recognised stock exchange such as the CSX.

Steps to Listing on the CSX

The first step when considering the primary listing of a fund’s securities on the CSX is to appoint an approved listing agent to assess the suitability of the listing, in particular to ensure that the proposed application satisfies the CSX’s conditions to listing. It will also be the listing agent that generally guides the fund through the listing process, coordinating and communicating with the CSX where necessary. In the case of an investment fund the conditions to listing include that the fund must appoint a suitable custodian and independent auditor, that it must calculate its NAV on at least a quarterly basis and that its securities must generally be freely transferable.

Assuming that the listing conditions are met and the CSX approves the listing in principle then the fund together with its listing agent (which will often be the fund’s Cayman Islands legal counsel) and professional advisers will prepare the requisite listing documents in accordance with the Listing Rules for submission to the CSX. However, since the CSX is not bound by EU listing directives, the regulatory burden and associated administrative obligations involved with any listing are less onerous than a listing on other major stock exchanges.

The Listing Rules of the CSX are based on IOSCO (International Organization of Securities Commissions) disclosure standards and therefore reflect currently accepted international best practice. Ultimately the aim is to ensure that investors are provided with sufficient and timely information to enable them to make an informed investment decision whilst not imposing unnecessarily onerous conditions or restrictions on issuers. Unlike certain other exchanges, the CSX does not for instance impose restrictions on matters such as a fund’s investment objective and policy, counterparty exposure limits, redemption terms (save the requirement that all shareholders be treated equally) or minimum subscription amounts.

Typically the principal listing document will be the prospectus or offering document used to promote the fund (the “Listing Document”). In the case of a fund whose securities will be listed on the CSX the Listing Document must comply with both the general provisions of the Listing Rules applicable to all issuers and the specific provisions contained in Chapter 9 of the Listing Rules in relation to Investment Funds.

The Listing Document must include, among other things, general information on the fund and its service providers, the securities for which the application is being made, its redemption and valuation provisions, the fund’s investment policy, disclosure in relation to its directors, risk factors and conflicts of interest and detail on the fund’s assets and financial position.

It is worth noting that there are additional requirements in the case of umbrella funds, feeder funds, fund of funds, property funds, closed ended funds and retail funds. The fund’s listing agent or Cayman Islands legal counsel will be able to advise further on these rules to the extent applicable.

The nature of the disclosure required by the Listing Rules also means that promoters may often be able to use existing offering documents (with a listing wrapper if need be) to list the securities of a fund that has already launched.

When the Listing Document has been prepared and reviewed by the listing agent for compliance with the Listing Rules then it will be submitted to the listing department of the CSX for initial review. In line with its reputation as a responsive exchange, the CSX commits to provide initial comments within five business days and three business days on subsequent submissions. Any comments received will then need to be incorporated into the Listing Document or otherwise addressed by the applicant, for instance by requesting a waiver of any listing rules deemed not to be applicable or relevant to the fund or its securities.

Once the Listing Document is in final form then it will be lodged with the CSX by the listing agent together with the supporting documentation (which will include various declarations by the issuer, its directors and the listing agent) and applicable listing fee for final approval by the listing committee of the CSX who then convene as often as necessary to approve applications.

Whilst the timeframe to listing on the CSX will depend upon a variety of factors and each application will be considered on its own merits, with advanced documentation, service providers on-boarded and commitment by all involved, three to six weeks is not an unreasonable timeframe for completion of the listing process.

Listing and Beyond

Once the fund and its securities are issued and the CSX listing procedures complete then the securities will be admitted to the Official List, allocated a Bloomberg ticker and details of the fund will be published on the CSX website. The fund will at this point also be subject to certain on-going continuing obligations. In general terms these oblige the fund to notify the market and its investors on a timely basis of any price sensitive information, material developments, operational changes or material changes in its performance or financial position which impact the fund or its securities.

As part of the listing process, the fund will also be obliged, initially and then on an on-going basis, to make certain documents such as its constitutional documents, material service provider agreements and any financial statements, available for public inspection.

Whilst listing the securities of an investment fund may not be appropriate for all managers or investment funds there can be considerable advantages in doing so and, as an integral part of the sophisticated financial services industry of the Cayman Islands, the CSX has demonstrated that there are sound reasons that any issuer should consider the CSX as a listing venue if it does indeed decide to pursue this option. Given that the CSX can approve a newly established fund without a track record, it is also an option open to established and emerging managers alike.

This article is intended to serve as high-level overview of the listing process rather than a comprehensive guide. Walkers is a global offshore law firm and internationally recognised as having a leading investment funds practice. Walkers is also an approved listing agent for the CSX and has a wealth of experience in the listing of investment funds and other products on the CSX.

Risk minimisation is the ultimate goal of insurance. Its purpose is to buy peace of mind and to soften the financial blow should the worst case scenario occur. Insurance is a major part of everyday life, and an even more integral part of business. Insuring your business is ensuring the protection of your biggest asset; your livelihood and future. Insurance law is therefore equally as important, covering all regulatory aspects of insurance, covering the regulation of insurance businesses, the content of insurance policies, especially with regard to consumer policies, and the regulation of the handling of claims.

Talking to Lawyer Monthly on the complexities of the insurance and reinsurance sector is Nicolò Juvara, Partner at the global law firm Norton Rose Fulbright, and head of the Italian practice and the corporate and M&A team there. Nicolò describes the extent of change the Italian insurance sector has undergone in recent years, the industries that are strong in the Italian insurance market, and talks about the potential to be found in upcoming EU directives in the insurance sector.

The insurance sector in Italy has undergone significant changes over the past two decades. I received my first significant mandate from an insurance client back in 1998, when I advised an Italian insurance company on the listing of its shares on the Italian stock exchange. In the context of that matter, I had to quickly become familiar with the peculiarities of the insurance industry. At that time, Italy was considered an under-insured country. It had a large number of small insurers and the market was dominated by motor insurance, for which tariffs were regulated.

Motor insurance is still at the core of the Italian insurance industry, but the market has been liberalised and, as a consequence, has become more profitable. The arrival of aggregators increased competition and enlarged the offer of different and innovative types of insurance products and coverage options. The industry has also consolidated; many small companies and operators have integrated into larger groups or simply disappeared.

Moreover, intermediaries, while still representing the dominant distribution channel, have become more specialized and, unlike in the past, face strong competition from alternative channels, like banks and financial service companies, as well as the Internet.

Looking ahead, insurance companies, intermediaries, and other players in the insurance market in Italy know that in order to survive the next decade, they will have to be more efficient and creative in meeting the changing needs of clients. At the top of the agenda of any insurer operating in Italy today, as in many other countries in Europe and around the world, is regulation, including first and foremost, the new Solvency II rules, and rules regarding consumer protection.

New rules and regulations inevitably have an impact on business processes, from product governance and design to distribution and claims management. The ability of a company to swiftly make the necessary changes in processes to comply with new rules and regulations, is key to getting new products to the market, and, in the long run, to the productivity and profitability of the insurers. On the other hand, lack of strategy and a slow, reactive, approach to new rules and regulations are two of the most common mistakes that insurers make.

In light of certain common trends arising from the EU legislation, new rules and regulations can and must be anticipated; they should be regarded as an opportunity to adopt a more modern approach towards the market. Italian and foreign insurers alike cannot afford to cling to antiquated business models and traditional products. Innovation and flexibility will be key characteristics of the business models of the next generation of successful leaders in the Italian insurance market.

Besides Solvency II, Italy’s insurance sector regulator, IVASS, has proposed new legislation which will further simplify the contractual documentation of insurance policies and communications to insured parties. This is designed to help insurers be more efficient and technologically advanced, to help them reduce administrative costs and, most importantly, reach the millenniums, the younger part of the potential client base in Italy, without compromising on consumer protection.

As a member of a highly respected law firm with a strong international insurance practice, we are often called upon to assist in consultation procedures relating to insurance legislation. In my view, one of our greatest contributions to these proceedings, as lawyers specialising in the industry sector with years of experience across jurisdictions, is to be able to explain and demonstrate how, sometimes, an overly formalistic approach to rules and regulations can damage not only the business of the insurers, but also the best interest of the consumers.

Touching on the topic of international trade this month is Dr. Bijan Kasraie, a founding member of Kasraie & Fodor, LLC. He talks to Lawyer Monthly about the biggest milestones in international trade over the past 30 years, in particular the UNDROIT initiative and the establishment of the WTO.

In the over 30 years you have been in business and practicing law, how have you seen the international trade scene evolve?

There are several major changes that have been helping international trade to take place more smoothly:

● The UNDROIT initiative is probably one the most important developments in international trade. It started with efforts to unify trade law and create unified international commercial laws and customs. It pivots around the right of people to enter into contract. It further established rules that parties could refer to in their contract. I can spend hours elaborating on the importance and the impact of UNIDROIT, but not today.

● Unifying the units and terms: For years the US and effectively the rest of the world were using different units of measurements, different business and financial terminologies, and different forms of international trade payments. Such differences frequently have been the cause of many business conflicts. However, during the past decades, efforts have been made to eliminate these differences and create unified terminologies and standards.

● Expansion of ADR (Alternative dispute resolutions) facilities. Litigation has and still takes a great deal of time and money, and the results are frequently hard to enforce. On the other hand, ADR centers were few and not convenient. Therefore, the expansion of ADR centers makes them more readily available to just about everyone.

● The World Trade Organization (WTO) has been probably the most important development to improve and facilitate the international trade. It took eight years to finally get established in January, 1995. As of 2016, 164 nations have been admitted to it. It deals with rules of trade between the member nations and is a forum for trade negotiation and dispute resolution. In short, it ensures the free flow of trade between nations. Unfortunately, I cannot spend enough time to further elaborate the role and importance of WTO.

How would you describe the current international trade landscape and what are the hottest talking points today?

Anti-dumping and politically related tariffs are hot talking points. It is very difficult for importers/exporters to know in advance of their shipment, and what costs they may incur at the disembarkation. Frequently, customs arbitrarily and capriciously impose charges that are nearly impossible to fight. Presently many nations use the flow of commerce to impose pressure on other nations in light of political conflicts.

As the founding member of Kasraie & Fodor, LLC, how do you push your teams to further explore the legal landscape of international trade and cover all details in their work?

I encourage the drafting of contracts that would be fair to both sides, which consequently leads to fewer conflicts. And I advise them to choose practical forums and finally make sure their contracts are enforceable.

As head counsel in numerous crossborder transactions, how do you push for the most commercially rewarding deals in your corporate work and what are the challenges you commonly encounter in relation to crossjurisdiction deals?

One of the common challenges is in educating our clients to be aware of the nuances of international trade in their negotiation with counterparts. Helping our clients to understand other cultures’ business acumen is also often a challenge.

You have also been the Financial and Economic Advisor to City Governments in the People's Republic of China since 1998; how does this help you push the boundaries of your work in international trade law?

It helps me further understand Chinese contract laws, business transactions, mode of payment, and how their legal system work, which is critical for anyone who wants to do business with or in China.

How does trading with developed, developing and under-developed countries differ?

In my book Understanding International Commercial Contracts (published by Thomson Reuters), I have elaborated in detail about the differences between doing business with different countries in different stages of development.

In short, it is critical for the international traders to know the economic development of the country they intend to do business with. Such knowledge helps one to know what type of commercial contract, insurance requirement, and banking facilities needed, to mention a few.

On the matter of company restructuring, from the latest regulation updates, to the biggest challneges this legal segment faces, our next thought leader details his thought leadership in the Cayman Islands‘ restructuring arena.

What are the biggest difficulties faced today surrounding company restructuring and how do you help resolve these on a daily basis?

There are a myriad of difficulties to deal with in any restructuring, but the key issues are always devising a solution which (i) should ensure the company’s medium to long term survival, (ii) is realistically capable of being adequately funded, (iii) will have the requisite support of the key stakeholders, and (iv) will be effective in compromising creditors’ claims and protecting the company’s assets in all relevant jurisdictions. When a Cayman company is involved it is typically as the holding company of an onshore / international group, and the Cayman legal issues which we assist with will be critical in ensuring a successful global restructuring.

What are the typical errors you see committed by companies involved in restructuring?

The most common error is leaving it too late to retain legal and financial advisers to work with the management on a restructuring solution, and failing to engage with the key creditors sufficiently far in advance of their debt maturing. This can often lead to increased restructuring costs, dealing with issues which might otherwise have been avoided, and more fundamentally it can jeopardize the company’s survival prospects.

Have there been any legal developments pertaining to restructuring in the Cayman Islands recently?

The most significant development in the last few years has been the Grand Court’s decision in Re China Shanshui Cement Limited (unreported, Mangatal J, 25 November 2015). China Cement concerned the question of whether and in what circumstances directors of Cayman Islands’ companies are authorised to seek to commence court supervised restructuring proceedings (which provide the protection of a moratorium on unsecured creditor action) by presenting a winding-up petition and applying for the appointment of provisional liquidators.

Prior to China Cement, the position pursuant to Re China Milk Products Limited [2011 (2) CILR 61] had been that if the company was insolvent (on a cash flow basis), the directors had the requisite authority to commence the process without needing either an express power in the articles of association or authorisation by a shareholders’ resolution.

In China Cement, Mangatal J concluded that China Milk had been wrongly decided. The learned Judge dismissed the insolvent company’s application for the appointment of restructuring provisional liquidators on the grounds that the directors had not been authorised to make the application.

Although there are conflicting decisions on the issue, applying the court’s reasoning in China Cement the position is now as follows. Irrespective of whether a Cayman company is solvent or insolvent, its directors are only able to instigate a court supervised restructuring process if they are authorised to do so by a shareholders’ resolution or (if the company was incorporated after the 1st March 2009) by an express power in the company’s articles.

In practice this issue has typically not been addressed expressly in the articles of Cayman companies, and so the ability to obtain a shareholders’ resolution is likely to be critical. This can create timing difficulties for insolvent companies which are in or approaching a financial crisis, particularly when (as is frequently the case) the Cayman company’s shares are publicly listed on a foreign exchange.

More fundamentally, it can give undue leverage to shareholders who may no longer have an economic interest in the insolvent company. It can also leave the directors (whose duty at that stage is to have regard to the interests of the company’s creditors) in a very difficult position where they are unable to instigate a court supervised restructuring process which they regard as being in the interests of the creditors as a whole.

As a thought leader, how have you worked towards adapting and moulding the restructuring law sphere in the Cayman Islands over the past decade?

Most recently I have been closely involved in working with several other leading practitioners on statutory reform to address the problems arising from the China Cement decision. It is hoped that a statutory solution addressing those issues and incorporating various other enhancements to the Cayman Islands restructuring regime will be ready to be considered by the legislature by the end of 2016.

For what is arguably the financial capital of the world, Switzerland is renowned for its jurisdiction’s financial benefits, but this doesn’t mean businesses encounter less risk. Here, Daniel Hayek, Partner at Prager Dreifuss, gives Lawyer Monthly an update on the Swiss insolvency & restructuring landscape, revealing the most recent matters the firm has been involved with, progress in legislation surrounding foreign bankruptcy decrees, and what in his opinion is still to be introduced to Swiss legislation in this regard.

Has the insolvency and restructuring sector evolved significantly since we last spoke three years back?

There have been various developments in the insolvency & restructuring sector over the past years.

On the one hand, several amendments to the Federal Statute on Debt Enforcement and Bankruptcy entered into force on the 1st January 2014. They were enacted to encourage restructuring rather than liquidation of a company in distress by facilitating the application and approval of a moratorium on debt restructuring. Other incentives for restructuring include changes to employment law in relation to the takeover of businesses and more debtor-friendly rules on dealing with long-term contracts allowing a company in distress to free itself from long-term commitments that obstruct its financial recovery.

On the other hand, new case law of the Federal Supreme Court has clarified the situation with regard to the recognition of foreign bankruptcy decrees. Under Swiss law, liquidators of foreign estates must apply for recognition of the foreign bankruptcy decree and the opening of ancillary bankruptcy proceedings in Switzerland before claims can be filed or any action taken in Switzerland. Once the application has been approved, the local bankruptcy office can file claims on behalf of the ancillary bankruptcy estate.

One of the requirements for recognition is that the foreign jurisdiction grants reciprocity. Previously, it had been unclear whether the Netherlands granted reciprocity. A judgment rendered by the Federal Supreme Court within the Petroplus liquidation has now laid down what qualifies as reciprocity, thus clarifying the legal situation and enabling recognition of bankruptcy decrees from the Netherlands.

What are the most recent legal matters you have been involved with and what have been the professional challenges therein?

Recently we have been involved in the insolvencies of Petroplus, Lehman Brothers and Swissair.

From an economic perspective, the current negative interest rate environment poses a major challenge in such large insolvencies. Since distributions on claims tend to be made rather towards the end than the beginning of a liquidation, creditors are naturally interested in the swift conclusion of insolvency proceedings. Currently, assets collected by the liquidator during the course of the insolvency proceedings and deposited with a bank are charged with negative interest. Liquidators are obliged to deposit collected assets with a designated bank and therefore cannot circumvent negative interest rates. This situation puts lawyers and liquidators under even more pressure to accelerate insolvency proceedings. One of the Petroplus liquidators challenged the negative interest rates in court, but the Federal Supreme Court recently ruled that there is no statutory obligation to apply a positive interest rate on mandatory deposit accounts. Thus, an insolvency lawyer needs to be very Daniel Hayek, Partner at Prager Dreifuss pro-active and anticipate creditors’ expectations in order to be able to act in his client’s best interest.

From a legal perspective a major challenge in a recent insolvency has been settling a key legal issue not yet decided by case law. For example, the question of subordination of intercompany loan agreements in favour of the bondholders in the Petroplus liquidation where we negotiated a settlement agreement involving not only the insolvent Swiss entity, but also the holding company and various foreign subsidiaries. As representatives of the Indenture Trustee and the Security Agent of bondholders we ensured that claims of our clients in the amount of CHF 1.9 billion, as well as claims of group companies amounting to several hundred million francs, were accepted. Successful conclusion of the settlement required a team effort and close cooperation between the liquidators and lawyers involved. Acceptance of the deal also depended heavily on clients’ and bondholders’ confidence in the negotiated solution which they approved after execution.

Are there any current changes to Swiss legislation in the insolvency sphere?

The Swiss Federal Council is planning to amend the provisions of the Federal Act on Private Law in order to facilitate the recognition of foreign bankruptcy decrees. It has been recognised that the current procedure to have foreign bankruptcy decrees recognised and ancillary bankruptcy proceedings opened in Switzerland is burdensome and costly. Examples like the recent ruling of the Federal Supreme Court on the recognition of Dutch bankruptcy decrees are a testimony to the obstacles foreign liquidators currently face. The planned amendments will have a great impact on any future crossborder insolvencies involving corporate groups and we are monitoring these developments closely.

Is there any further legislation you believe necessary to be introduced in Switzerland at this point in time?

In the aftermath of the financial crisis, insolvency litigation in Switzerland has become more finance based. While there exist specialised commercial courts to deal with finance based litigation, almost all insolvency related litigation is dealt with by the court for debt enforcement and insolvency actions on a mandatory basis. Where insolvency litigation is heavily finance based, for example because the underlying contracts are based on ISDA Master Agreements, the debt enforcement and insolvency court may not dispose of the same level of expertise as the commercial court.

Further, in certain parts of Switzerland the debt enforcement and insolvency court will be composed of a single judge. In complex cross-border insolvencies where the legal issues relate to foreign law and require expert opinions the court might be stretched for resources. As a consequence, cases take longer to be adjudicated than they should, a very frustrating situation for the client and all parties involved in the insolvency proceedings. In such cases it would be beneficial if the parties were able to choose the court where they want to bring their action rather than ascribing mandatory jurisdiction to the debt enforcement and insolvency court. This would ensure that the competent court disposes of the appropriate level of expertise and personal resources to deal with the case in an efficient and timely manner.

As a thought leader, what key considerations would you advise potential future insolvency & restructuring lawyers to always raise with their clients?

Where lawyers advise the board of a company it is important to advise on statutory obligations when the company is in distress. Otherwise, board members can be held personally liable if the company becomes insolvent at a later stage. Here, events of default under a revolving credit facility in particular, can prove to be fatal for the company and its directors. Where the company’s liabilities exceed the assets and lenders demand payment, or refuse to agree on an enforcement standstill period, the board has to notify the debt enforcement and insolvency court within four to six weeks. If the board fails to do so and the company later becomes insolvent, the directors may be liable towards the company, its shareholders and the company’s creditors.

In complex cross-border insolvency cases lawyers might also be advising foreign liquidators of affiliated or subsidiary companies. In such cases insolvency lawyers need to advise the foreign liquidator on the particularities of the lawyers’ domestic insolvency regime. For example, many foreign liquidators are not aware that they need to apply for recognition of the foreign bankruptcy decree and for the opening of ancillary bankruptcy proceedings in Switzerland.

Finally, where a lawyer is representing a creditor vis-à-vis an insolvent company, he needs to ensure that the client’s claim is properly substantiated within the required timeframe, as otherwise the claim will be rejected. Especially where the underlying legal issues are governed by foreign law, the lawyer needs to ensure that his client obtains legal advice on the respective foreign law as soon as possible.

Even in the highlands, business finds a way of falling into crisis. To this end, Alan Meek works hard with his clients in finding the fastest solutions, the most efficient methods and the best results. Below Alan tells Lawyer Monthly about the crucial and significant differences between the UK and Scotland’s restructuring law, the impact of social and political scenarios on businesses in Scotland, and about the solution he provides his clients with on a daily basis.

As a specialist advising on all aspects of corporate insolvency and restructuring – which sectors would you say are currently experiencing distress/insolvency and restructuring more than others in Scotland?

Currently we are seeing considerable strain on businesses associated with the North Sea and renewables but other sectors such as care homes and property are also stressed. As with other parts of the UK the causes are a mix of global, European and local political and social issues. It would be fair to say that the Scottish economy is dependent upon the public sector to a greater extent than is the case for many regions south of the border and that brings its own challenges at all times but particularly in times of austerity.

What would you say are the most common restructuring and insolvency mechanisms for distressed corporations in Scotland. Is Scotland different in this regard from the rest of the UK?

There are a considerable number Alan Meek, Partner at MacRoberts LLP of differences between Scottish insolvency law and practice and the law and practice in the rest of the UK. The basic regimes and processes are the same – administration, liquidation, receiverships and CVAs but there are significant differences. We don’t have LPA receivers for example and our fixed and floating securities are different. In Scotland a landlord has a form of security for unpaid rent that ranks ahead of the floating charge. Our court system is completely different of course and it’s worth knowing that Scottish limited partnerships have their own legal personality so they can, themselves, go into formal insolvency. When they do, they go into sequestration (Scottish bankruptcy). We don’t have the Official Receiver and we have our own set of Insolvency Rules. We also seem to make more appointments of provisional liquidators north of the border. In Scotland we have historically made proportionately less use of CVAs for restructuring than in England and Wales. There are a number of reasons for this – practitioner unfamiliarity and perceived cost compared to other processes being the two main ones. The risk of running a CVA without an administration wrapper is also a large disincentive; having said that, CVA usage has increased recently. Administration (with a prepack or other business sale) is by far the most common process used in business restructuring in Scotland.

So, in summary, corporate recovery is practised a bit differently here in Scotland although the broad outlines would be recognisable to other UK practitioners.

Politically, liquidation, sequestration, and receivership are devolved issues. Administration and CVAs are not. That is confusing and unwieldy and hardly conducive to flexible and responsive policy-making and social engineering.

What can make an insolvency turn contentious? Why do businesses need to consider seeking specialist advice at the earliest sign of difficulty?

Insolvencies/restructurings turn contentious principally when the competing claims and requirements of stakeholders cannot be accommodated. That may be lenders vs management or differing groups of landlords being treated differently. The trick (if there is a trick) is ensuring that as much fairness as possible can be meted out to the different interests (within the strictures of the Insolvency Act of course) at the same time as delivering an effectively restructured business.

At what point can a reorganisation plan be proposed it?

Really, the earlier the better. The further down the decline curve a business goes, the fewer are options it has. If the plan involves some pain for all, and needs to be consensual to any degree, it is better to ensure that the business still has breathing space and options on the other side if Plan A cannot be satisfactorily implemented. It is important to identify stakeholders and involve them as early as possible.

How challenging is assisting with the restructuring of a corporation?

It is challenging. But I think the professionals involved sometimes forget that it is actually the management team who bear the brunt of what has to happen. They are the ones who have to implement a turnaround plan within the business (an insolvency process is really only the framework mechanism that allows the opportunity for a business to recover). The workforce has to live with the emotional and commercial upheaval and uncertainty associated with business distress. It is necessary to appreciate that there are individuals involved and not just corporate entities. There can be a bit of a social work or counsellor role in some cases. For the advisors, it is challenging – but it can be very rewarding too.

What can you bring to the table to assist when your clients face distress or insolvency?

Sometimes insolvency just cannot be avoided. Sometimes economic factors conspire against a business to such an extent that it renders their business model unsustainable. Catastrophic falls in property prices or changes to Government funding arrangements would be examples. If that is the case, the management are obliged to ensure that the impact on creditors is minimised as far as possible. That will often require professional advice to affect the best outcome and, if insolvency can be avoided, professional advice will maximise the chances of that occurring.

Is there anything else you would like to add?

We are obviously living through an unprecedented time of change in the political landscape. Brexit, a change of Prime Minister and ongoing considerations of Scottish independence mean that there is great uncertainty for businesses now and in the foreseeable future. UK and European banks appear to be under stress to an extent not seen since just before the 2008 crash. Inevitably this will put additional strain on our clients’ businesses. Some will find ways to weather these storms, others will not. As advisors, our role will be to help those businesses deal with the challenges they will face. It won’t be easy – but then again, if it were easy, no one would pay us to do it. We are certainly living in challenging times and it is often said that what businesses and investors crave most is stability. The uncertainty attaching to Brexit and Scotland’s place in the UK means that investment decisions are being deferred or indeed cancelled. If a business has a model that is largely dependent upon EU sales, what should it be doing now to prepare for the next few years given that no one can tell it whether or not it will be able to export in the manner that it has done hitherto? As the curse goes, “may you always live in interesting times.” We are certainly living in interesting times but I suspect many businesses yearn for the dull days to return.

According to Deloitte’s 2016 banking industry outlook, several aspects of the global banking sector have been experiencing, and are set to experience, serious existential threats. As change is spurred across the globe, uncertainty surrounding the future of the banking sector is rife, and questions are arising about the next decade of banking.

Here to give Lawyer Monthly her perspective on banking & finance landscape in Morocco, is Nadia Kettani of the Kettani Law Firm. Nadia discusses the daily operations of the firm, the latest legislative changes in the Moroccan banking sector, and talks about the challenged involved in fiancning projects in the North African region.

Kettani Law Firm (KLF) is a major Moroccan business law firm founded in 1971 by Professor Azzedine Kettani who was admitted to practice as a lawyer in 1968 and is approved by the High Court of Justice of the Kingdom of Morocco. He was joined in 1992 – after internships in France and the United States – by Nadia Kettani, who is the Head of the International Consulting Department while supervising some areas of the Litigation Department; and Rita Kettani in 1993, who is the Head of the Commercial Department, the Litigation Department and the Labour Law Department. The firm acts for banks and other financial institutions, international businesses, major public and private companies and government departments.

Who are the clients you regularly deal with on banking matters and what kind of challenges do they bring to the firm?

KLF assists both multinational and large local companies whether they are banks of private entities. With respect to international clients, one of the main challenges is that the clients are familiar mostly with common law and do not necessarily fully understand the environment of civil/continental law. Therefore, international clients wish to apply foreign law, which is not always accepted or understood in Morocco, although both private entities and public ones are more and more open to the idea. In addition, multinationals systematically want to apply international arbitration as a dispute resolution clause, which is not always accepted, although more accepted in Morocco.

Over the past 30 years, what would you say have been the most impacting banking directives/regulations to change the Moroccan financial landscape?

Over the past 30 years, all banking laws and regulations in Morocco have been updated and upgraded. The banking Law itself has been amended in order to become investor friendly and open to new types of products, such as the Islamic finance for instance. With respect to capital markets, laws and directives have been upgraded to International standards and supported by a complete reform of the General Instruction of the ‘Office des Changes’ (IGODC), which also became investor friendly. Multinationals can buy local debt as much as local clients can buy international debt, both without the prior authorization of the exchange control office. Consequently, Moroccan banks and multinational companies are able to offer investment in a standardized and efficient legal context. The recognition by Morocco of tools such as ISDA’s master agreement templates allows Moroccan actors to use international legal instruments, and international players to offer those a safe legal environment.

Please tell me about the regulatory developments that have affected financial services in Morocco most recently.

Several laws have affected financial services in the past years. Most recently Moroccan authorities passed a Law relating to debt securitisation, a Law relating to the real estate collective investment scheme (OPCI) (passed but not yet applicable), and Islamic financial products.

What trends have you noticed with consultancy clients over the last year?

What challenges have they raised and how have you navigated these? Over the last year, consultancy clients have continued to approach Morocco, as it is the safest country in the region, but act carefully. Indeed, most of them investigate prior to their investment and eventually invest in stages. The challenges are the same as the ones raised on a regular basis, i.e. applicability of foreign law as governing law; enforcement and implementation of contracts as well as the enforcement of arbitration awards or foreign judgments.

As a thought leader, how are you and your firm helping towards the successful expansion of project financing in Morocco?

Kettani Law Firm has participated in most project finance deals in Morocco, whether in the energy sector or others. It has developed a legal know-how as it has had the opportunity to act for sponsors, lenders or EPC contractors.

All legal aspects are therefore covered and mastered by KLF, with the most salient ones being in energy projects; for instance the quiet enjoyment, the access right or the surface right concept. Other more specific aspects usually relate to the enforcement by a foreign investor of the limitation of liability and the liquidated damage clause or the nature of security package that can benefit to a foreign player.

How do you believe Morocco’s infrastructure development, and other projects, could make the nation more appealing to FDI?

Morocco cumulates a finetuned legal system (notably in the field of renewable energy and public-private partnership with recent laws that have been passed) and a dynamic governmental strategy. To cite a few examples, the Moroccan government adopted the Green Plan strategy (‘Maroc Vert’) relating to the agriculture sector for the years to come. The Green Morocco Plan’s strategy concerns a sector which contributes 19% of the GNP, with 15% from agriculture and 4% from agro-industries.

The Government also adopted a solar plan (‘Plan Solaire’), launched in 2009. This project is part of Morocco’s energy strategy, which focuses on the development of renewable energy and sustainable development. These long-term governmental strategies aim at encouraging investments in expanding sectors.

The modern corporate world is pitted with potential legal traps. It takes a skilled and experienced legal professional to guide companies through the challenges involved, challenges which vary from country to country.

This month Lawyer Monthly looks at the issues surrounding the corporate world in North America by speaking to Jose Ramon Gonzalez, Chief Legal Officer and Corporate Secretary for QBE North America.

Jose talks about the career path that led him to boast the title of thought leader in the corporate world, and excel in his role at QBE. He also discusses the rewards and challenges surrounding the corporate affairs he and his legal team are involved in daily.

What has been your overall career trajectory and what is it in particular that keeps you going?

My career trajectory has been very interesting and the evolving nature of my role is what keeps me going. The life as an attorney in today’s corporate legal climate is challenging and in constant change. To succeed you need to be dynamic and on top of your game. The challenge is what energises and enables me to pursue my work with enthusiasm and vigour every day.

I began practicing law in 1995 as a corporate associate at the law firm of Weil, Gotshal and Manges working in the firm’s London and New York offices. After a number of years of rigorous training in highly complex global transactions, I joined the in-house team at American International Group, Inc. (AIG). Representing one of the world’s largest financial services organisations in acquisitions, joint ventures and investments for their insurance and asset management businesses was an incredible opportunity. It allowed me to apply all of the “hard” legal skills I learned at Weil in a business context, and it provided the opportunity for me to spend a considerable amount of time in Asia and Latin America, where I was able to hone my skills as a global lawyer.

All of this experience was put to practice in my next role. Torus was launched in 2008 with 20 people in Bermuda and London, and grew to over 600 employees in 13 offices worldwide. When I joined as Global General Counsel in 2011, Torus was in the mist of its expansion and needed senior leaders who could serve more than one role. Given my background, I immediately jumped into the transactional work, playing a key role in negotiating the acquisition of a Lloyd’s managing agency and Torus’ network of European offices, as well as trying to start an insurance operation in Brazil.

From Torus, I joined QBE, which presented a particularly interesting challenge. At the time, QBE was undergoing a massive transformation involving the entire company. This literally required a re-engineering of the legal function to assure we were supporting the transformation, as well as providing ongoing legal services to the company.

What corporate law matters do you deal with on a regular basis at QBE?

At QBE, over the last two years, I have focussed primarily on corporate governance and mergers and acquisitions.

Assuring that appropriate corporate governance is maintained in our North American companies continues to be one of my most important functions. As an area of increasing importance over the last decade, boards are looking to their legal team to provide them with the tools they require to effectively discharge their duties and responsibilities. As Corporate Secretary to our US companies, we regularly review our governance environment and make sure we are applying best practices. We also keep abreast of developments outside the US to give us possible indications of future developments. In the UK for instance, we have recently followed implementation of the Senior Insurance Managers Regime and possible implementation of Solvency II remuneration requirements.

M&A has been another area of focus. When I joined QBE, as part of our transformation QBE was disposing of various divisions that did not fit within our current strategy. These deals bring me back to my origins. I truly enjoy the art of the deal and negotiating the best outcome for my client. I immediately became involved in these transactions. After many months of hard work, I am happy to the say that the legal team played a successful part in the implementation of that part of our strategy.

What kind of challenges did these matters entail professionally?

The matters presented many diverse challenges. As the transformation at QBE North America proceeded, it was imperative to keep our North American Board of Directors up to date on how our initiatives were developing in order to assure they were able to exercise their oversight function. Our non-executive directors in particular relied on me to serve as a vital link between themselves and our senior executive team.

M&A work similarly presents a huge number of challenges. The logistical challenges of getting ready for sale, preparing and negotiating deal terms and executing the transaction are always great. Time was of the essence. Given the transformational process occurring at QBE North America, we needed to complete these deals quickly, efficiently and accurately so that we could begin to focus on growing our business. Our committed legal team was instrumental in achieving this corporate goal.

You work with a large team of lawyers; how do you keep all eyes on the ball from day to day?

As Chief Legal Officer, by definition my job is to keep my eye on many balls. I must identify emerging issues, prioritise rigorously, bring all relevant company stakeholders to the table, and make sure the CEO and other senior leaders are kept up to date on important matters. This is no easy task, but this is what makes my role so interesting and why I’m so fully engaged every day.

Strong relationships with your team, along with superior support staff, is also essential to staying on top of it all. At QBE, we divide our legal department into five areas: Corporate, Litigation, Regulatory, Compliance, and Business Unit Support. Despite our size, we have a strong culture of communication in our legal team. I spend the day connecting with members of our legal team, both formally and informally. Building strong relationships facilitates communication, and gives everyone in the department the confidence to raise issues, no matter how difficult. In short, it encourages a culture of collaboration at all levels, which enables me to effectively oversee a large global legal team.

What would you say are the difficulties you encounter with your team, and how do you apply thought leadership in navigating these successfully?

Living through a transformational process as thorough as the one recently completed at QBE North America was not easy. Rapid change is unsettling for people, but ongoing, open communications and team engagement is key to effectively leading through the changes. Things are much better now that we are on the other side of our transformation. However, there are always challenges on the horizon, as we now focus on consolidating our legal team, engaging our business partners, and embedding the legal function into our business processes. Keeping the legal team focused on our goal of creating a legal, regulatory and compliance function that is aligned to our corporate business goals has been the most difficult aspect of my role.

What legislative change has most impacted your work in the last decade?

For organisations operating in the US, the Dodd Frank act signed by President Obama in the wake of the 2008 financial crisis continues to strongly impact our industry. Among other things, the law established the Federal Insurance Office, adding a level of Federal oversight to an area that has been regulated historically at the state level. In addition, some of our larger competitors have been classified as ‘systemically important financial institutions’ (SIFIs) by the Federal Stability Oversight Council, an arm of the US Treasury established to monitor excessive risk in the US financial system. While not something that affects us directly, we need to keep an eye on these developments in order to understand how that may impact QBE in the future.

As a corporate attorney in a highly regulated financial services company, could you provide LM with some insight on how you ensure the satisfaction of your regulators?

When overseeing regulatory and compliance matters for a company in the highly regulated financial services industry, it is imperative that you maintain excellent relations with your regulatory stakeholders. This assures that your regulators understand your ability, as well as your commitment, to uphold the highest standards in corporate governance and regulatory compliance.

One of my biggest challenges is to make sure that my team and I are reconciling applicable corporate governance requirements in the face of increasing regulatory oversight. This involves ongoing communication with regulators, our board and other internal stakeholders.

Having studied all over Europe, and taken in the width and depth of what commercial law can offer, this thought leader has authored over 50 scientific publications and written five books!

With experience in the Supreme Court, what would you say is the most common commercial matter disputed in Italy and why do you think this is?

In my experience I can say that the most common commercial matter disputed in Italy is the responsibility of directors and it may concern budget appeals, actions of responsibility of the directors or shareholders and board resolutions of appeals, proceedings under Article 2409 Italian Civil Code for administrative irregularities, malpractice liability actions for management, and coordination pursuant to article 2497 of Italian Civil Code.

What are the biggest benefits of resolving commercial disputes via arbitration and how popular is this DR method in Italy?

In my opinion the biggest benefits of arbitration solution are the following:

• quick decision-making;

• content costs;

• technical competence and independence of referees.

In Italy you can make use of arbitration for the resolution of disputes if it has previously been a written clause in the contract, which delegates resolution to the dispute. In the absence of the arbitration clause, you may have recourse to arbitration through the conclusion of a written agreement - the act of compromise. The important thing is that the award has the value of a judgment given by the judicial, and constitutes an enforceable title.

In dealing with international cases, what challenges do crossjurisdiction proceedings entail? In each commercial relation I always suggest to give importance in negotiating the “jurisdiction clause” and the “applicable law clause” in order to avoid problems in case of dispute. In addition it is important to verify the possibility of recognition of judgments in the countries of both contracting. In my opinion the difficulty lies in the interpretation of the rule and in the different system of standards between countries.

As a thought leader in Italian commercial law segment, what improvements or reforms would you like to see benefit the sector?

• Simplification and cost reduction for the establishment of companies;

• More detailed regulations for the right of shareholders to information with respect to the activity carried out by the directors of a limited liability company;

• Tax breaks and reforms for the protection of intangible assets.

You are also a professor teaching on EU & Labour law; as a thought leader how does this help you expand your boundaries and goals in the legal profession?

Teaching Urban Planning Law and European Union Law at the University of Catania is a huge help because it allows me to put into practice the matter studied. Learning about the new reforms, the analysis made by the doctrine, and the recent developments in case law, allows me to achieve better results in less time.