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English Court Provides Guidance for Commencing Proceedings On Foreign Defendants

Posted in Dispute Resolution

The English Court has set aside permission to bring proceedings against foreign defendants based on non-disclosures and subsequent conduct.

By Dan Smith and Duncan Graves

The recent decision in Punjab National Bank (International) Limited v Ravi Srinivasan and others [2019] EWHC 89 (Ch) provides guidance on the proper conduct of an application for service out of the jurisdiction and highlights the potential pitfalls an applicant may encounter. In particular, the decision demonstrates that a party must:

  • Make full and frank disclosure on a without notice application, in particular if there are related foreign proceedings or new material facts arise
  • Renew its application for permission for any substantive changes to its pleadings
  • Plead fraud with care, precision, and particularity

Failure to follow these guidelines may result in the court setting aside permission for service, thereby bringing the claim to an end. Continue Reading

Service of Proceedings on a Foreign State is Mandatory

Posted in Dispute Resolution

An arbitration award cannot be enforced in England against a foreign State without serving the proceedings on that State through the diplomatic channels.

By Robert Price

In General Dynamics UK Ltd v Libya [2019] EWHC 64 (Comm), Males LJ, sitting in the Commercial Court, set aside parts of an order granting permission to enforce an arbitration award against Libya because the order was not served on the State in the manner required by the State Immunity Act 1978 (SIA). The court held that section 12(1) SIA, which provides for service through the Foreign and Commonwealth Office (FCO) of any “writ or other document required to be served for instituting proceedings against a State” is mandatory and the court is not permitted to validate an alternative method of service that does not comply with section 12 SIA.

Facts

The Claimant, a UK company, successfully brought claims in arbitration resulting in an award of nearly £16 million award against the State of Libya (Award). The underlying dispute arose out of a contract between the parties for the supply of communications systems. Although Libya had participated in the arbitration proceedings which took place in Geneva, by the time of the enforcement proceedings in England it had made no effort to satisfy the Award. Continue Reading

Payment Systems Regulator Finalises Scope of Card Acquiring Market Review

Posted in Emerging Companies and Technology, Finance and Capital Markets

The PSR will not review the fees and rules set by Visa and Mastercard, but will look at the practice of bundling, and will examine effects on innovation in card-acquiring services.

By Brett Carr, Stuart Davis, and Christian McDermott

Following the publication of its Draft Terms of Reference in July 2018, the PSR has now listened to market feedback and has issued its Final Terms of Reference, marking the launch of its review into whether competition in the supply of card-acquiring services is working well for merchants and consumers.

Card-acquiring services allow merchants to accept payment for goods and services via debit, credit, charge, and prepaid cards. In order to benefit from card-acquiring services, merchants must enter contracts with so-called “merchant acquirers”. Card-acquiring services are often bundled with other services, referred to by the PSR as “card acceptance products” — these include physical card readers (also known as point-of-sale (POS) terminals) and payment gateways (the e-commerce equivalent of POS terminals).

The Final Terms of Reference follow a consultation period on the Draft Terms of Reference, the details of which are covered in Latham’s previous blog post. Continue Reading

English Court of Appeal Upholds an Extension of Time to Commence Arbitration

Posted in Dispute Resolution

The Court allows an application to extend time for bringing arbitration proceedings under section 12(3) of the Arbitration Act 1996.

By Robert Price and Eleanor Scogings

In the recent case of Haven Insurance Company Limited v EUI Limited (T/A Elephant Insurance)[i], the English Court of Appeal dismissed an appeal against a High Court decision granting EUI Limited (Elephant) an extension of time to bring arbitration proceedings after the expiry of a time bar. The Court of Appeal confirmed that it is only willing to grant an extension under section 12(3) of the Arbitration Act 1996 (the Act) in exceptional circumstances, and then only if the circumstances in which the request was made were outside the reasonable contemplation of the parties when they agreed upon the time bar provision.

In Haven, the Court of Appeal held that the lack of clarity in the dispute resolution procedures of the Motor Insurers Bureau (MIB) meant that Elephant had not acted unreasonably and ought to have the opportunity to pursues its claim out of time.

The decision serves as a useful reminder to litigants and counsel of the importance that the English courts attach to complying with time limits and the courts’ unwillingness to interfere with parties’ agreed procedures for an arbitration, even if those procedures relate to the time period after the arbitral award. Continue Reading

English Court of Appeal Clarifies Test for Determining Jurisdictional Challenges

Posted in Dispute Resolution

Applicants challenging jurisdiction must satisfy a single three-limbed test, rather than establish a ‘good arguable case’ and ‘better of the argument’.

By Oliver E. Browne and George Schurr

The English Court of Appeal has clarified the correct test to be applied by the English courts when adjudicating a jurisdictional challenge. In the recent case of KAEFER Aislamientos SA de CV v AMS Drilling Mexico SA de CV and others [2019] EWCA Civ 10, the Court ruled that the correct test is that laid down by the UK Supreme Court in Goldman Sachs International v Novo Banco SA [2018] UKSC 34, which is a single test composed of three limbs, replacing the old two-part test of ‘good arguable case’ and ‘better of the argument’.

Facts

KAEFER Aislamientos SA de CV (the Claimant) was retained pursuant to the terms of a Purchase Order dated 16 August 2013 (the Purchase Order) to carry out refurbishment works to a cantilever jack-up rig known as the Atlantic Tiburon 1. Although the Purchase Order was executed by Atlantic Marine Services BV (AMS, the Second Defendant), its terms indicated that invoices for work carried out thereunder should be addressed to AMS Drilling Mexico SA de CV (AMS Mexico, the First Defendant) for settlement. Continue Reading

How A No-Deal Brexit Would Affect Life Sciences Cos.

Posted in Brexit, Life Sciences

Latham lawyers explain the impact of a no-deal Brexit scenario and how it will impact life sciences companies operating in the UK

By Frances Stocks Allen, Hector Armengod, Christoph Engeler, and Robbie McLaren

There are now fewer than three months to go until the United Kingdom’s exit from the European Union on March 29, 2019. On Jan. 15, 2019, the UK government rejected the provisional deal proposed by the prime minister and accepted by the EU which would have offered terms for Brexit and future interactions between the UK and the EU following the withdrawal date. Unless the EU and the UK agree to an alternative deal, the withdrawal date is delayed or Article 50 is revoked, all EU primary and secondary law will cease to apply to the UK with effect from the withdrawal date, and the UK will become a “third country” for the purposes of EU legislation. Under this no-deal Brexitscenario, all provisions of EU law relating to EU member states will no longer apply to the UK, with potentially chaotic results for the life sciences industry.

In particular, the impact on marketing authorizations could be highly disruptive. The marketing authorization holder, or MAH, of a marketing authorization approved via the European Medicines Agency’s centralized approval procedure (each a CMA) must be established in the European Economic Area. Following the withdrawal date, the UK will no longer be part of the EEA, so any CMA held by a UK MAH will need to be transferred to an entity within the EEA prior to the withdrawal date. If not, it will be unlawful for the relevant CMA-approved product to be placed on the market in the EU. The EMA follows a 30-day timeline from submission of a CMA transfer application to finalization of the EMA’s transfer opinion. However, after the transfer opinion is issued, the European Commission must deliver its decision on the transfer before it becomes effective, a process which generally takes between two and three months, following which product labeling must be updated and implemented. To the extent that a CMA transfer application is not already underway, it will be too late to transfer such CMA to an EU MAH before the withdrawal date and avoid disruption to supply, even where bridging stock will be used to build supply in markets as a contingency measure.

Continue Reading

Addressing Pensions Liabilities for Underperforming Portfolio Companies

Posted in Employment and Benefits, M&A and Private Equity

By Catherine Drinnan and Shaun Thompson

Click for larger image.

This year has seen a significant number of business failures, particularly on the high street, as businesses have struggled in the face of market fragility and Brexit uncertainty. When a UK portfolio company is underperforming, the presence of a defined benefit pension (DB) plan with a large deficit can be a significant problem. Companies with large pension deficits require contributions that affect cash flow and make exiting more difficult when the time comes to sell.

If a business slips into distressed territory, however, there are mechanisms whereby a company can divest itself of a DB scheme. As companies respond to Brexit and challenging conditions in some sectors, we believe that 2019 will see more of these types of arrangements. In our view, PE deal teams should consider how to respond if portfolio companies are at risk. While the mechanisms can be effective in allowing a company to continue trading (in some form), PE owners should note a number of important factors before deciding to attempt this. Continue Reading

Effect of a “No-Deal” Brexit on IP in the UK

Posted in Brexit

The UK government’s technical notices provide some certainty for holders of cross-border copyrights, trade marks, patents and other IP rights.

By Deborah Kirk, Terese Saplys, and Grace Erskine

On 24 September 2018, the UK government published a series of technical notices explaining how a “no-deal” Brexit would impact intellectual property rights in the United Kingdom, including: copyrights, trade marks and designs, patents, and the exhaustion of intellectual property rights. It seems timely to revisit the content of these technical notices, given that on 15 January 2019 the UK Parliament will vote on (and, as has been widely reported by various media outlets, seems likely to reject) the proposed deal as agreed between Prime Minister Theresa May’s cabinet and the EU.

The UK Government has outlined how each of these intellectual property rights protections would or would not change following the UK’s exit from the European Union, which is currently anticipated to be 29 March 2019. This blog post summarises the areas identified in the technical notices of particular interest and concern to companies with cross-border operations. Continue Reading

Italian Football Ready to Re-Join Financial Elite

Posted in M&A and Private Equity, Media and Entertainment

Increased revenue, improved governance, and innovative financing in Serie A are drawing interest from overseas investors.

By Giancarlo D’Ambrosio

In the 1980s and 1990s, Italian football dominated the European football industry, achieving consistent success on the field and attracting a vast global audience. Italy’s top division, Serie A, is still among the best in the world, but the English Premier League and Spain’s La Liga have overtaken Serie A as a financial force. The Premier League and La Liga have developed and commercialised their products in the overseas market in recent years, creating a gap between them and rival European leagues. Yet a shift is underway, and — due to more stable revenues, improved governance, and innovative financing structures — Italian football is ready to re-join Europe’s financial elite.

Italian football investment is ready to kick–off. Increased revenue from TV rights deals will drive improved financial performance and present opportunities for investors. This past summer, broadcasters Sky and Perform sealed a deal to screen Serie A fixtures for €973 million per season until 2021, following a competitive auction process. The domestic rights deal followed an agreement to sell international rights to IMG for €371 million, at nearly double the rate of the previous cycle. Changes to Champions League regulations, allowing four Serie A clubs to qualify for Europe’s elite tournament, will further boost revenue in 2019. Continue Reading

Corporate Buyers Poised to Reap W&I Insurance Benefits

Posted in EU and Competition, Finance and Capital Markets, M&A and Private Equity

By Drew Levin. Maarten Overmars, Richard Butterwick, Terry Charalambous, and Catherine Campbell

Warranty and indemnity insurance (W&I) has become a common feature of European transactions in recent years, amid a strong sellers’ market that has enabled vendors to offload risk to buyers. According to the most recent edition of the Latham & Watkins Private M&A Market Study, which examined transactions between July 2016 and June 2018, the proportion of transactions employing W&I has continued to increase — from 8%, 13%, and 22% of deals in the previous three editions of the survey, to 32% for the latest period surveyed. We believe M&A deal teams should be aware of changes and enhancements to W&I that will bring insurance coverage closer in line with the US market. In our view, the developments are positive for M&A bidders. Continue Reading

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