UK publishes White Paper with hard-hitting regulatory proposals to tackle online harms.

By Alain Traill, Stuart Davis, Andrew Moyle, Deborah Kirk and Gail Crawford

On 8 April 2019, the Home Office and the Department for Culture, Media and Sport (DCMS) published an “Online Harms White Paper”, proposing a new compliance and enforcement regime intended to combat online harms. The regime is designed to force online platforms to move away from self-regulation and sets out a legal framework to tackle users’ illegal and socially harmful activity. Although the regime appears to target larger social media platforms, the proposals technically extend to all organisations that provide online platforms allowing user interaction or user-generated content (not limited to social media companies or even ‘service providers’ in the traditional sense) and set out a potentially onerous and punitive compliance and enforcement regime for a broad set of online providers.

A rare example of the English High Court varying an arbitral award.

By Oliver E. Browne and Eleanor M. Scogings

In Dakshu Patel v. Kesha Patel [2019] EWHC 298 (Ch), the English High Court upheld an appeal under section 69 of the Arbitration Act 1996 (the Act) against an arbitral award. The court concluded that the tribunal had erred in law in finding that there had been a variation of the profit-sharing provisions of two partnership agreements. The court also indicated that a related section 68 challenge would have succeeded (had it been necessary to decide the point). The court varied the award and held that the parties were entitled to share the profits and losses equally under the partnership agreements.

The case highlights the very high threshold for permission to appeal an award, and is a rare example of an appeal under section 69 succeeding in the English courts. On the facts, there was no conduct or agreement that could be interpreted as a variation. While courts do not usually interfere in the arbitration process, the tribunal had reached what the court described as a “very surprising conclusion” that warranted intervention.

The guidance provides helpful clarity on key regulatory changes impacting life sciences companies in the event of a no-deal Brexit.

By Frances Stocks Allen, Oliver Mobasser, Héctor Armengod, Gail E. Crawford, Christoph W.G. Engeler, Robbie McLaren, and Henrietta J. Ditzen

The UK Medicines and Healthcare products Regulatory Agency (MHRA) has published a significant volume of guidance documents on various aspects of the post-Brexit life sciences regulatory landscape in the UK, including in the event of a no-deal Brexit. The guidance provides helpful clarity to life sciences companies operating in the European Economic Area (EEA) and the UK, which continue to face significant uncertainty about how they will be impacted by Brexit — particularly given the ongoing risk of a no-deal Brexit. (For detailed analysis on how a no-deal Brexit scenario would impact life sciences companies, please see this prior Latham blog post.)

Background

On 29 March 2017, the UK Prime Minister gave the European Council formal notification under Article 50 of the UK’s intention to leave the EU, setting the default withdrawal date for the UK’s withdrawal from the EU to 11 p.m. GMT on 29 March 2019. The UK Prime Minister requested an extension to the original withdrawal date in light of the UK Parliament’s failure to approve the withdrawal agreement agreed between the UK Prime Minister and the European Commission. On 21 March 2019, the European Council approved the UK government’s request, permitting an extension of the Article 50 period until either:

  • 22 May 2019, if the UK Parliament approves the withdrawal agreement by the end of the week commencing 25 March 2019
  • 12 April 2019, if the UK Parliament does not approve the withdrawal agreement by the end of the week commencing 25 March 2019, with this period capable of further extension by agreement between the European Council and the UK government, provided that the European Council expects the UK to indicate “a way forward” prior to 12 April 2019

The court offers guidance on reversing lawful dividend payments and when directors need to take into account creditors’ interests.

By Simon J. Baskerville, Daniel Smith, Anna Hyde, Lisa Stevens, and Vanessa Morrison

On 6 February 2019, the UK Court of Appeal published a judgment in BTI v. Sequana that will impact both creditors and directors of English companies.

The court decided that the payment of a dividend — despite its lawfulness under the Companies Act 2006

CONSOB notice 8/2019 details the requirements under the Italian investor compensation scheme applicable to UK banks and investment firms operating in Italy.

By Antonio Coletti and Isabella Porchia

On 29 March 2019, the Italian Securities Commission (CONSOB) issued a notice detailing the terms and requirements applicable to UK banks and investment firms operating in Italy in connection with the Italian compensation scheme (Fondo Nazionale di Garanzia or the Italian ICS) pursuant to Article 8 of the Brexit Law Decree

The instructions clarify the requirements applicable to banking and financial intermediaries under the Brexit Law Decree.

By Antonio Coletti and Isabella Porchia

On 28 March 2019, the Italian central bank (Bank of Italy) published two notices detailing the requirements for Italian banks and financial intermediaries operating in the UK, and for UK banks and financial intermediaries operating in Italy, respectively, further to Brexit Law Decree No. 22 of 25 March 2019. The decree lays down a temporary regime for regulated

The notice details the requirements applicable to UK investment firms operating in Italy, and Italian investment firms operating in the UK.

By Antonio Coletti and Isabella Porchia

On 26 March 2019, the Italian Securities Commission (CONSOB) issued a notice detailing the requirements applicable to UK investment firms operating in Italy and Italian investment firms operating in the UK, further to Brexit Law Decree No. 22 of 25 March 2019. The decree lays down a temporary regime for regulated firms in a no-deal Brexit scenario. (Additional background information is available in this Latham.London post.)

The decision clarifies how lawyer-client privilege applies in the context of transactions.

By Daniel Smith and James Fagan

The recent English High Court decision Raiffeisen Bank International AG v Asia Coal Energy Ventures Limited and Ashurst provides guidance on the application of legal advice privilege in a transaction context, confirming that confidential client instructions can be privileged even if the legal adviser has been instructed to provide a third party with confirmations based on those instructions.

This case offers a useful overview of the application of privilege to communications between lawyers and clients during transactions. The decision sets out a number of useful principles regarding privilege and client instructions:

  • For lawyer-client communications to benefit from privilege they must take place in a legal context.
  • Confidentiality is necessary for privilege to apply to communications, but it is not determinative.
  • Communications that do not contain legal advice can still be covered by legal advice privilege provided they form part of a continuum of communications between lawyer and client.
  • When instructing a legal adviser to disclose confidential information to third parties, clients must take care to ensure that underlying communications remain privileged.

Parties must draft arbitration agreements with Chinese parties clearly and precisely to ensure validity and avoid unwanted litigation.

By Oliver E. Browne and Isuru Devendra

A Beijing court recently adopted a pro-arbitration approach in upholding the validity of an arbitration agreement designating a non-existent arbitral institution. While the decision reflects the increasingly pro-arbitration attitude of Chinese courts, the case also highlights the importance of drafting arbitration agreements involving Chinese parties clearly and precisely.

Background and decision

In Chinalight International Trade Co. Ltd v Tata International Metals (Asia) Ltd, the Beijing No. 4 Intermediate People’s Court was asked to determine the validity of an arbitration agreement designating a non-existent arbitral institution to administer disputes submitted to arbitration under the agreement.