With $1,012,059,000 gross revenue in 2021, the firm placed 50th on The American Lawyer's 2022 Am Law 200 ranking. degree of difficulty in segregating and ascertaining individual assets and liabilities; presence or absence of consolidated financial statements; profitability of consolidation at a single physical location; commingling of assets and business functions; unity of interests and ownership between the various corporate entities; existence of parent or intercorporate guarantees or loans; and. In some securitisation transactions they are also responsible for establishing and preparing the relevant securitisation structure and documentation. Any Exchange Act violation could also result in equitable remedies, including the right of rescission. Firm Overview:Shearman & Sterling has a long and distinguished history of supporting its clients wherever they do business, from major financial centers to emerging and growth markets, for nearly 150 years. Newbies in the seat were drawn to the opportunities in developing areas of renewable energy and green power on offer, with typical tasks including drafting contracts, document management, and proof-reading.. As a global, elite law firm, Shearman & Sterling represents many of the worlds leading corporations and major financial institutions, as well as emerging growth companies, governments and state-owned enterprises, on ground-breaking, precedent-setting matters. Our clients rely on our tax planning at every stage of a transaction, from early planning to successful conclusion, and recognize and appreciate our creativity in solving complex tax issues, both local and cross-border. abstain from engaging in certain abusive or anti-competitive conduct. The firms initiatives include WISER (Womens Initiative for Success, Excellence and Retention), BLAQUE (Black Lawyers Aligned in the Quest for Excellence), AACES (Asian Attorneys for Community, Empowerment and Success), and finally: BUILD (Black Undergraduate Internship & Lawyer Development). The intersection of legal and accounting requirements often plays a significant role in structuring a securitisation transaction. The available mode of perfection differs based on the type of asset and type of transfer. 5 Contributions provided by Shearman & Sterling LLP, The general counsel's comprehensive guide | USA. Shearman & Sterling represented J.P. Morgan as the initial purchaser in connection with KWG Group Holdings Limiteds tap offering of $158 million 7.40% senior notes due 2024. Student loans originated under the Federal Family Education Loan Program (FFELP) benefit from a government guarantee and securitisations of such loans will therefore have a reduced risk retention requirement of between 0% and 3% depending on the level of the guarantee. Shearman & Sterling is one of the worlds leading premier global law firms and was established over a century ago. Seat options: antitrust; funds; M&A; project development and finance; finance; litigation; international arbitration; financial institutions advisory; tax; employment; financial restructuring and insolvency. Shearman & Sterling Future Diamond Limited's $200 Million Senior Notes Offering. public statement by LIBORs administrator, ICE Benchmark Administration Limited (IBA), or its UK regulator, the UK Financial Conduct Authority, that the actual cessation of LIBOR has occurred or is expected; a public statement or publication of information by the IBA that LIBOR is no longer representative as an index (known as a pre-cessation trigger); or. In addition, the Foreign Account Tax Compliance Act (FATCA) imposes a withholding tax on certain payments (including interest in respect of debt instruments issued by a securitisation SPE and gross proceeds from the sale, exchange or other disposition of such debt instruments) made to a foreign entity if the entity fails to satisfy certain disclosure and reporting rules. Apply today at CareerBuilder! SOFR is a secured rate derived from borrowing and lending activities on US treasuries, while LIBOR is based on a survey of quotations from participating banks regarding what they believed the going-forward unsecured interest rate should be. Re-securitisations are subject to separate risk weight calculations. Shearman & Sterlings hectic but excitingcorporate M&A seat covers work in industries such as mining, telecommunications, financial services and shipping. Insurance companies capital rules are typically more closely tied to ratings. Number of lawyers worldwide: 800+. who circulates opportunities weekly via email. ABS issuers generally do not prepare financial statements. In determining whether a transfer is a true sale or a disguised loan, courts look to a number of factors. The specific RBC formula varies depending on the primary insurance type and focus on asset risk, underwriting risk and other risk. SOFR has been used routinely in CLOs, where the pool assets consist generally of floating rate commercial loans, but the ARRC has expressed displeasure over the recent use of term SOFR as the benchmark for other floating-rate ABS backed by fixed-rate receivables. Legal. there is a signed agreement that reasonably identifies the relevant rights and assets. Brokers or dealers may continue to quote Rule 144A ABS without further restriction until 4 January 2025, but as that date approaches it is not clear the extent to which broker-dealers will be comfortable continuing to participate in those offerings when a known issue could impact their liquidity. Limiting the SPEs unrelated activities and restricting the SPE from having employees and unrelated property reduces the risk of unrelated liabilities. While it was stipulated that the alleged misconduct resulted from actions taken by the Trusts servicers and sub-servicers in the course of their debt collection activities, and not by any actions taken by the Trusts themselves, the CFPB named only the Trusts as defendants in this lawsuit after having previously settled with the servicers involved. Wilful violations and abuse of the end-user clearing exception are felonies punishable by a fine of up to USD1 million or imprisonment for up to ten years, or both, together with cost of prosecution (see CEA Section 13). In circumstances where that exemption does not apply, the withholding tax could still be reduced or eliminated by virtue of applicable income tax treaties. Jay Singer is noted for his strength in structuring tax-efficient corporate transactions. Hogan Lovells has around 2500 attorneys and Shearman boasts about 850. Establishing a bankruptcy-remote special-purpose entity (SPE) is a key aspect of a typical securitisation transaction. Shearman & Sterling represented the initial purchasers in connection with Shinsun Holdings (Group) Co., Ltd.s debut offering of $200 million 10.5% senior notes due 2022. The firm leverages the use of smart technology in all of its client work through its innovative data management system, Shearman Analytics, which provides a leading edge in staffing matters leanly and effectively. with respect to transactions where the underlying pool assets bear floating rates, a transition of a specified percentage of those assets from LIBOR based to adjusting using an alternative index. a requirement on filing financing statements; provisions requiring notification and potentially opinions prior to any changes in the name or jurisdiction of the organisation; control over securities accounts, deposit accounts and electronic chattel paper; delivery or custody of chattel paper, securities and instruments; and. Shearman & Sterling LLP Website www.shearman.com Share profile Contact details Contact number +65 6230 3800 Related Rankings Chambers Review Notable Practitioners Ranked Morgan, Lewis & Bockius LLP The District Court subsequently granted a motion for an interlocutory appeal, which was granted by the US Third Circuit Court of Appeals on 3 May 2022. Many of these changes do not appear to be focused primarily on asset-backed securities (ABS) or the securitisation markets, but present unforeseen and challenging consequences. L-shaped risk retention, by holding a combination vertical and horizontal risk retention that adds up to 5%. The proposed rules would require a number of new disclosures for registrants, including: The proposed rules do not distinguish ABS issuers from corporate issuers, and their application to ABS issuers in the form proposed would be problematic in several respects. Enforcement and Penalties for Non-compliance. eHi Car Services Limited's $300 Million Senior Notes Offering and Concurrent Tender Offer. early amortisation events that cause accelerated pay-downs of principal and terminate reinvestment or revolving periods (temporarily or permanently); servicer termination events that give rise to a right to terminate the servicer; and. The NAICs letter described a hypothetical example in which an investment in all of the tranches in a CLO transaction would be subject to a lower RBC factor than a direct investment in the CLOs underlying collateral, and they expressed their position that the RBC factor each such investment should be equal. However, many broker-dealers appear to have concluded that their quotation procedures for these securities do involve publishing them (or submitting them for publication), so that the rule does not apply. The firms structured transactions practice serves the financing needs of the worlds most sophisticated businesses. Shearman & Sterling is one of the worlds leading premier global law firms and was established over a century ago. The primary investor protections follow from the general and specific securities laws described in this chapter. SPEs established as single-member LLCs or Delaware statutory trusts can be readily structured to avoid entity-level tax. The SECs enforcement authority and remedies for violations of the Risk Retention Rules would be the same as its general enforcement authority against those in violation of securities laws and regulations and their control persons, including permanent or temporary cease-and-desist orders, fines, withdrawal of registrations and restrictions on acting as officers or directors of SEC-registered companies, and otherwise may strip a person or entity of privileges afforded to registered persons. The students are paid a juicy 400 per week. Overseeing the efficient and cost effective recruitment of high calibre trainees for the London office, and overseeing the pastoral and professional care of current trainees in the firm, ensuring compliance with SRA requirements. Shearman & Sterling is one of the worlds leading law firms, serving the domestic and cross-border needs of an impressive roster of clients. As a result, the proposed rules could result in the disclosure of a number of immaterial risks for ABS issuers. For contracts without any fallback provision (other than the disregarded fallback provisions described below), or with fallback provisions that do not identify a specific USD LIBOR benchmark replacement or identify a determining person with authority to select a benchmark replacement, a benchmark replacement recommended by the Federal Reserve will automatically replace the LIBOR benchmark in the contract after 30 June 2023. The opinion will usually identify these key factors and draw a conclusion based on the overall analysis and reasoning in the opinion letter. Follow Shearman & Sterling on Instagram and LinkedIn. The information must be published at least three days prior to bringing a covered securitisation to market. The accounting literature includes commentaries on the legal opinion requirements, including the opinion expressly mentioning each area of continued involvement between an originator and its affiliates and the securitisation SPE. During the amendment process, it came to the attention of market participants that the SEC was taking the position that the rule applies, and has always applied, to fixed-income securities. Shearman & Sterling has over 850 lawyers globally, speaking more than 75 languages. In 2022, Shearman & Sterling celebrated their golden anniversary in London, having set up shop 50 years ago! The accounting standards also include a discussion of various types of qualifiers and assumptions that are deemed not to be appropriate for accounting purposes. Advised Ardagh Group on its definitive business combination agreement with Gores Holdings V to create an independent public company. Furthermore, the CFTCs authority to penalise manipulation and fraud is similar to the SECs authority under Section 10(b) of the Exchange Act. Broker-dealers may be restricted from providing price quotations for private debt securities by virtue of Rule 15c2-11 unless certain periodic information and information about the issuer and the offering is made available to the public in a manner that complies with the SECs no-action letter issued on 30 November 2022. A titling trust is established to originate the lease and hold title to the leased assets. Finally, the SEC has proposed, but not finalised, conflict-of-interest rules intended to address conflicts of interest inherent in synthetic securitisations that would have made such securitisations impracticable in many circumstances. London, United Kingdom. The covered fund definition only captures entities that would have to register under the Investment Company Act but for the exemption set forth in Section 3(c)(7) or 3(c)(1), or that are commodity pools for which the commodity pool operator has claimed an exemption from registration and record-keeping requirements pursuant to Section 4.7 of the CEA, or that are substantially similar commodity pools. SOFR compounded in advance, calculated by compounding interest over a set period of days. Rule 15c2-11 under the Securities Exchange Act of 1934 (Exchange Act) allows brokers or dealers to initiate or resume trading quotes on OTC securities not listed on a national securities exchange by requiring them to obtain and review specified issuer information prior to publishing or submitting for publication a quotation on the securities. While the ARRC suggests that the first alternative should be a forward-looking term SOFR with a matching term to LIBOR, no such rates were available at the time the ARRC released its recommendations. Therefore, the New York statute is now only relevant to contracts that reference the omitted one-week or two-month LIBOR tenors. Delaware has up-to-date business entity laws that provide for efficient and quick formation, a sophisticated judiciary and a significant volume of decisions that together provides additional certainty and acceptance. specific greenhouse gas emission metrics. 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