Global Trade Review (GTR)’s Post

In transfer pricing, you'll often hear terms like related party, associated person, associated enterprise. Broadly speaking, these terms refer to one and the same thing. Check Day #10 of our TP "What is?" Edition to understand what an associated enterprise is. For more information on TP, reach out to us via: info@brainvestgroupgh.com. Also visit our website for more exciting content: www.brainvestgroupgh.com #AssociatedEnterprise #ALP #Armslengthprinciple #BEPS #Transferpricing #TP #TPinGhana #Tax #InternationalTax #Law #Lawyer #Consultant #Business #Taxlaw #OECDTalks #OECD #Finance #Accounting #Financeprofessional #Economics #Economist #Crawl #Walk #Run #CFO #CEO #Grouptax

[💡LEGAL INSIGHTS] VALIDITY OF SUBORDINATION CLAUSES UNDER LUXEMBOURG LAW 💠 𝗦𝘂𝗯𝗼𝗿𝗱𝗶𝗻𝗮𝘁𝗶𝗼𝗻 𝗖𝗹𝗮𝘂𝘀𝗲𝘀 𝗶𝗻 𝗙𝗶𝗻𝗮𝗻𝗰𝗶𝗮𝗹 𝗖𝗼𝗻𝘁𝗿𝗮𝗰𝘁𝘀 Subordination clauses are a cornerstone of financial structuring, used to establish contractually priority rankings among creditors. These clauses are particularly relevant in 𝗹𝗼𝗮𝗻 𝗮𝗴𝗿𝗲𝗲𝗺𝗲𝗻𝘁𝘀, 𝗿𝗲𝘀𝘁𝗿𝘂𝗰𝘁𝘂𝗿𝗶𝗻𝗴𝘀, and 𝘀𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝘀𝗮𝘁𝗶𝗼𝗻𝘀. 💠 𝗘𝗻𝗳𝗼𝗿𝗰𝗲𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗢𝘂𝘁𝘀𝗶𝗱𝗲 𝗜𝗻𝘀𝗼𝗹𝘃𝗲𝗻𝗰𝘆 In cases outside insolvency scenarios, subordination clauses are 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗹𝘆 𝗲𝗻𝗳𝗼𝗿𝗰𝗲𝗮𝗯𝗹𝗲 by application of 𝗔𝗿𝘁𝗶𝗰𝗹𝗲 𝟭𝟭𝟯𝟰 𝗼𝗳 𝘁𝗵𝗲 𝗟𝘂𝘅𝗲𝗺𝗯𝗼𝘂𝗿𝗴 𝗖𝗶𝘃𝗶𝗹 𝗖𝗼𝗱𝗲, which enshrines the principle of contractual freedom to the extent such clauses are properly drafted. 💠 𝗘𝗻𝗳𝗼𝗿𝗰𝗲𝗮𝗯𝗶𝗹𝗶𝘁𝘆 𝗶𝗻 𝗜𝗻𝘀𝗼𝗹𝘃𝗲𝗻𝗰𝘆 𝗦𝗰𝗲𝗻𝗮𝗿𝗶𝗼𝘀 In insolvency scenarios, subordination clauses must mainly be reconciled with the 𝗽𝗿𝗶𝗻𝗰𝗶𝗽𝗹𝗲𝘀 𝗼𝗳 𝗲𝗾𝘂𝗮𝗹𝗶𝘁𝘆 𝗼𝗳 𝘁𝗿𝗲𝗮𝘁𝗺𝗲𝗻𝘁 𝗼𝗳 𝗰𝗿𝗲𝗱𝗶𝘁𝗼𝗿𝘀 set forth in Article 2093 of the Civil Code, which is generally viewed as being of 𝗽𝘂𝗯𝗹𝗶𝗰 𝗽𝗼𝗹𝗶𝗰𝘆 (𝘰𝘳𝘥𝘳𝘦 𝘱𝘶𝘣𝘭𝘪𝘤). Luxembourg courts and legal doctrine 𝗴𝗲𝗻𝗲𝗿𝗮𝗹𝗹𝘆 𝘂𝗽𝗵𝗼𝗹𝗱 𝘁𝗵𝗲 𝘃𝗮𝗹𝗶𝗱𝗶𝘁𝘆 of subordination clauses, recognizing them as a valid contractual arrangement even in case of bankruptcy (𝘧𝘢𝘪𝘭𝘭𝘪𝘵𝘦). 💠 𝗦𝗽𝗲𝗰𝗶𝗳𝗶𝗰 𝗖𝗮𝘀𝗲: 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝘀𝗮𝘁𝗶𝗼𝗻𝘀 In the context of 𝘀𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝘀𝗮𝘁𝗶𝗼𝗻𝘀, the amended 𝗟𝘂𝘅𝗲𝗺𝗯𝗼𝘂𝗿𝗴 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝘀𝗮𝘁𝗶𝗼𝗻 𝗟𝗮𝘄 𝗼𝗳 𝟮𝟮 𝗠𝗮𝗿𝗰𝗵 𝟮𝟬𝟬𝟰 expressly acknowledges the validity and enforceability of subordination mechanisms. This legislative clarity provides clear legal certainty for investors involved in structured finance transactions. 💠 𝗞𝗲𝘆 𝗖𝗼𝗻𝘀𝗶𝗱𝗲𝗿𝗮𝘁𝗶𝗼𝗻𝘀 To ensure enforceability of subordination clauses: ▪️ 𝗗𝗿𝗮𝗳𝘁 𝗖𝗹𝗲𝗮𝗿𝗹𝘆: Define the terms and scope of the subordination unambiguously. ▪️ “𝗟𝗲𝘃𝗲𝗿𝗮𝗴𝗲” 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝘀𝗮𝘁𝗶𝗼𝗻 𝗟𝗮𝘄 : For securitisations, rely on the legal statutory recognition of subordination mechanisms. 📩 Whether you are structuring a financing, negotiating creditor agreements, or navigating insolvency complexities, we can assist. 𝗖𝗼𝗻𝘁𝗮𝗰𝘁 𝘂𝘀 at info@sedlo.lu for guidance tailored to Luxembourg banking and finance law.

Loper Bright Enterprises? Big. Corner Post. Bigger? The continued proliferation of disparate state commercial finance disclosure laws. Biggest? Check out this week’s Alternative Commercial Finance Update by Alex McFall, Shelby Lomax and me for our latest thoughts on SME finance. https://lnkd.in/eJr3sBhN

KEY POINTS: CHINA’S COMPANY LAW AMENDMENTS EFFECTIVE JULY 1, 2024: COMPREHENSIVE ANALYSIS AND STRATEGIC IMPLICATIONS FOR FOREIGN ENTERPRISES Amendments to China’s Company Law: Effective July 1, 2024, major changes will require companies to fully contribute their registered capital within five years of establishment. New Companies: Must complete capital contributions within five years, demanding precise financial planning and resource allocation from the start. Existing Companies: Granted a three-year transition period until June 30, 2027, to adjust and complete their capital contributions by June 30, 2032. Joint-Stock Companies: Must fully pay subscribed shares by June 30, 2027, requiring shareholder engagement and strategic financial planning. Penalties for Non-Compliance: Include fines, equity forfeiture, and legal sanctions, emphasizing the importance of compliance. Motivations: Focus on enhancing creditor protection and addressing capital commitment discrepancies to promote financial transparency. Foreign Companies: Must review and adjust capital commitments, seek legal and financial consultations to ensure compliance with the new regulations. Read the full article here: https://lnkd.in/dbJUVBGa #ChinaCompanyLaw #ChinaBusinessRegulations #ChinaCapitalRequirements #ChinaCorporateCompliance #ChinaFinancialTransparency

On 7 June 2024, the Singapore International Commercial Court (SICC) granted an order for approval of the pre-pack scheme in Re No Va Land Investment Group Corp [2024] SGHC(I) 17. This was the first cross-border pre-pack scheme to be approved in the SICC. In Re No Va Land, the Applicant foreign company proposed a pre-pack scheme for the restructuring of its convertible bonds. The SICC determined that it had jurisdiction to approve the scheme. First, the scheme was both international and commercial in character, due to the respective facts that the Applicant was a foreign company and the restructuring concerned corporate bonds. Second, although the Applicant was a foreign unregistered company, it has substantial connections to Singapore. The bonds were SGX-ST listed, the indenture governing the bonds provided for disputes to be by arbitration seated in Singapore, and the scheme contemplated voluntary submission to the SICC by the Applicant and supporting bondholders. The SICC approved the pre-pack scheme as it complied with disclosure requirements in s 71(3) of the IRDA. Under s 71(3), the Applicant must sufficiently disclose all material information prior to its scheme application. In Pathfinder Strategic Credit LP and another v Empire Capital Resources Pte Ltd and another appeal [2019] 2 SLR 77, the Singapore Court of Appeal held that the disclosure requirement for schemes is satisfied if the disclosure of material information is sufficient to ensure well-informed creditor voting. The SICC clarified that this applies to pre-pack schemes as well. The overwhelming creditor support for the Applicant's scheme was a strong indicator that the disclosure requirement was satisfied. Further, the SICC clarified the court’s expectations for pre-filing disclosures. The court expects full compliance with statutory requirements for disclosure for pre-packs. While the court does not expect extensive paperwork or data, parties deserve a clear, concise, and understandable description of the restructuring transaction, restructuring alternatives, its potential risks and rewards, accessible and clearly formatted supporting financial data, and an index to related materials to allow for deeper diligence if deemed necessary. The disclosure requirement is ordinarily satisfied unless the court’s assessment of the evidence, creditors’ votes, or the case’s merits, reveals that the disclosure deviated from customary market practice so as to affect its fairness and reliability. Read more at: https://lnkd.in/gTEjTjRn #insolvency #resturcturing #singapore

KEY POINTS: CHINA’S COMPANY LAW AMENDMENTS EFFECTIVE JULY 1, 2024: COMPREHENSIVE ANALYSIS AND STRATEGIC IMPLICATIONS FOR FOREIGN ENTERPRISES Amendments to China’s Company Law: Effective July 1, 2024, major changes will require companies with legacy entities in CHina to fully contribute their registered capital within five years of establishment. New Companies: Must complete capital contributions within five years, demanding precise financial planning and resource allocation from the start. Existing Companies: Granted a three-year transition period until June 30, 2027, to adjust and complete their capital contributions by June 30, 2032. Joint-Stock Companies: Must fully pay subscribed shares by June 30, 2027, requiring shareholder engagement and strategic financial planning. Penalties for Non-Compliance: Include fines, equity forfeiture, and legal sanctions, emphasizing the importance of compliance. Motivations: Focus on enhancing creditor protection and addressing capital commitment discrepancies to promote financial transparency. Foreign Companies: Must review and adjust capital commitments, seek legal and financial consultations to ensure compliance with the new regulations. Read the full article here: https://lnkd.in/dbJUVBGa #ChinaCompanyLaw #ChinaBusinessRegulations #ChinaCapitalRequirements #ChinaCorporateCompliance #ChinaFinancialTransparency

🚀 German law tips for English lawyers: New article alert! 🚀 I'm thrilled to share an insightful article authored by Pascal Urban, associate secondee in the Travers Smith Finance team during autumn 2024. Pascal's piece, "German obligors in cross-border financing transactions," was patiently written in response to my long list of FAQs. From navigating facilities agreements to understanding the intricacies of German law security documents and notary fees, this article provides valuable guidance for English lawyers involved in a cross-border financing with German entities.   It covers: - The types of obligor entities typically encountered (GmbH, GmbH & Co. KG, AG…) - Key concepts in drafting and executing security documents - Enforcement considerations and legal frameworks    Check out the full article here: https://lnkd.in/e9V3M_GP   Special thanks to Pascal Urban and to Gleiss Lutz for this collaboration.   Still reading? To save time on my LinkedIn post, I showed the article to Jylo and asked it for a first draft. I even asked for jokes… Why don't secrets work well in banking transactions? Because good news spreads fast, but bad news just compounds interest! 💰😆 No German sausages were harmed in the making of this article. They’re the Wurst! 🌭😂   Health warning: Jokes not authored by Travers Smith or Gleiss Lutz. Actual article contains no jokes or AI-authored content.   #CrossBorderFinance #GermanLaw #FinancialTransactions #LegalCollaboration #JIBFL

Recently, the Singapore Court of Appeal has provided guidance on when directors’ duties are owed to a company’s creditors, particularly when a company is in financial distress. In summary, the decision indicates that the creditor duty can be engaged even when a company is solvent and as such, has moved the dial in favour of creditors putting additional pressure on directors of distressed companies to ensure they are fully apprised of the financial state of the company before transacting and/or making decisions to the detriment of company creditors. Jared Green and I have summarised the position below. Click on the link to read more: https://lnkd.in/eXxgw7w3

In Day #13 of our TP "What is?" Edition, we look at the ramifications of Place of Effective Management (POEM) on Transfer Pricing. Check this out! For more information on TP, reach out to us via: info@brainvestgroupgh.com. Also visit our website for more exciting content: www.brainvestgroupgh.com #POEM #PE #Transferpricing #TP #TPinGhana #Tax #InternationalTax #Law #Lawyer #Consultant #TaxConsultant #Business #Taxlaw #OECDTalks #OECD #Finance #Accounting #Financeprofessional #Economics #Economist #CFO #CEO #Grouptax #Crawl #Walk #Run

Trade & Capital Account learning of the day :12 LLP-II LLP-1I filing is done at the time of disinvestment of Capital contribution or transfer of ownership in an LLP from a Non-Resident to Resident or Vice versa. The filing should be done within 60 days from the date of receipt of the amount of consideration