The new Regulation on Money Transfer Rules came into effect on July, 9. It replaced Regulation No. 2-P of October 30, 2002 on the Cashless Money Transfers in the Russian Federation and Regulation No. 222-P of April 1, 2003 on the Cashless Money Transfers by Individuals in the Russian Federation. Click here to read more.
Orrick Alert
Summary of Required Financial Statements of Businesses Acquired or to Be Acquired
Rule 3-05 of Regulation S-X requires audited financial statements to be filed for a significant business (or a significant group of related businesses) that has been acquired or the acquisition of which is probable. This article, written by Bruce Czachor and Stephen Ashley, discusses the specific financial statements required, as well as the situations in which they need to be included. Click here to read more.
Orrick Restructuring Alert: Lessons for Lenders from Tousa Circuit Court Decision
This alert, written by Raniero D’Aversa, Jonathan Guy and Amy Pasacreta, discusses the bankruptcy case of TOUSA, Inc. and its various subsidiaries is one where lenders have seen their fortunes rise and fall. On March 15, 2012, they fell again when the Eleventh Circuit reversed the District Court’s opinion and reinstated the Bankruptcy Court’s order, which had disgorged over $400 million from Tousa’s senior lenders and avoided certain guarantees and liens granted to them by the Conveying Subsidiaries. Specifically, the Circuit Court found: (i) the Tousa Bankruptcy Court did not err when it found the Conveying Subsidiaries did not receive reasonably equivalent value in exchange for the new liens provided to the New Lenders; and (ii) the Transeastern Lenders were the direct beneficiaries of the new liens and as such subject to the avoidance powers of section 550(a). Click here to read more.
Financial Industry Alert: FSA Releases Finalised Guidance on Payment for Order Flow Arrangements
On 14 May 2012, the FSA issued its finalised guidance on payment for order flow (“PFOF”) arrangements following its October 2011 guidance consultation. The guidance appears to have been issued on substantially the same basis as the original consultation which stated that “PFOF arrangements create a clear conflict of interest between the clients of the firm and the firm itself. Therefore it is unlikely to be compatible with our inducements rule and risks compromising compliance with best execution rules”. Click here to read more.
Reporting Non-GAAP Financial Measures Under SEC Rules
This article, authored by Orrick lawyers Bruce Czachor and Stephen Ashley, discusses the issues surrounding market participants’ preference of using non-GAAP financial metrics to evaluate investment opportunities versus the SEC’s need for consistency in how public companies communicate financial measures to investors.
Derivatives Month in Review
The Derivatives Month in Review highlights the month’s important legal, regulatory and other newsworthy developments in the area of derivatives. Click here to view May’s edition.
Orrick Alert: Jumpstart Our Business Startups (“JOBS”) Act Eases Restrictions on Rule 144A and Private Offerings – ABS Considerations
President Obama signed the Jumpstart Our Business Startups Act (the “Act”) into law on April 5. The Act includes many provisions intended to facilitate capital raising and reduce regulatory burdens for certain types of issuers, but does little for the asset-backed securities market, which continues to grapple with the Dodd-Frank Act and related regulations and the looming specter of Reg AB II.
ABS issuers, underwriters and investors, however, will be interested in the sections of the Act that amend the exempt offering provisions of the Securities Act of 1933 (the “Securities Act”) and direct the Securities and Exchange Commission (the “SEC”) to revise regulations to permit general solicitation and advertising in connection with offerings that are exempt from registration under the Securities Act. Click here to read more.
Orrick Alert: Jumpstart Our Business Startups Act – Implications for Issuers and Financial Institutions
On March 27, 2012, the U.S. House of Representatives adopted the Jumpstart Our Business Startups Act (the “JOBS Act”) with strong bipartisan support, sending the bill to President Obama to sign. The JOBS Act is intended to stimulate economic growth by improving access to the U.S. capital markets for U.S. and foreign startup and emerging companies. The President is expected to sign the JOBS Act into law this week.
Many business groups, including the U.S. Chamber of Commerce, support the JOBS Act and believe it will facilitate capital raising by small companies, allow emerging growth companies to make a transition to public company status while continuing to grow and create jobs, and reduce some of the regulatory burdens imposed by the Sarbanes-Oxley Act of 2002. While certain provisions in the JOBS Act will provide added flexibility to such earlier stage companies, its potential impact on the capital markets remains unclear. Many industry participants are concerned that the JOBS Act may erode investor protections and leave investors susceptible to securities fraud. In addition, because the JOBS Act did not alter the liability regime under U.S. securities laws, it remains unclear how market practices will change or develop for issuers and financial institutions. Such new market practices will depend, in large part, on the rules and guidance provided by the Securities Exchange Commission and other regulatory agencies such as the Financial Industry Regulatory Authority, which we will continue to monitor.
Second Circuit Grants SEC’s Motion for Stay and Sharply Criticizes District Court’s Rejection of Settlement in Case Against Citigroup
On Thursday, March 15, the United States Court of Appeals for the Second Circuit issued a per curiam stay order strongly criticizing Judge Jed S. Rakoff’s order rejecting a proposed consent judgment between the Securities and Exchange Commission and Citigroup Global Markets Inc. The Second Circuit granted the Commission’s motion for a stay of the district court proceedings in SEC v. Citigroup Global Markets Inc., No. 11 Civ. 7387 (S.D.N.Y.), pending resolution of the appeals. Click here to read more.
First Report of SEC’s Whistleblower Office Contains Some Surprises
On November 16, 2011, the SEC’s Office of the Whistleblower released its first annual report to Congress, as required by section 924(d) of the Dodd-Frank Act. The report only includes information about tips received after the final rules implementing the program became effective on August 12, 2011. As a result, it only includes seven weeks of data. Still, the information provides useful insights into the number and types of whistleblower complaints being received and some insights into the Office’s staffing and activities to date. Click here to read more.