Shearman And Sterling

Shearman & Sterling is firmly committed to helping clients achieve their business objectives. With a focus on our clients’ changing needs and goals, we deliver a wide range of materials and services to keep them up to date and informed.

Perspective

M&A Watch: Contractual Fraud: ‘Too Much Dynamite’ Can Blow Enforceability

September 24, 2021

On August 12, 2021, Vice Chancellor Slights of the Delaware Court of Chancery, in Online HealthNow, Inc. and Bertelsmann, Inc. v. CIP OCL Investments, LLC, et al (Del. Ch. August 12, 2021), denied defendants’ (seller’s) motion to dismiss a buyer’s post-closing fraud claims arising from representations and warranties in a purchase agreement that allegedly were known to be false when made, noting that a seller may not use a limitation of liability clause in a contract obtained by fraudulent inducement to bar a buyer’s fraudulent contract claim.

Perspective

Closure of DIFC-LCIA Arbitration Centre Causes Uncertainty

September 23, 2021

By Decree No. 34 of 2021, effective as of September 20, 2021, Dubai has abolished the DIFC-LCIA Arbitration Centre (DIFC-LCIA) and the Emirates Maritime Arbitration Centre (EMAC) and seeks to fold their assets and operations into the Dubai International Arbitration Centre (DIAC).

Perspective

Podcast: Refinitiv LPC’s Lender Spotlight Series

September 22, 2021

Join our panel of Shearman & Sterling partners as they discuss large cap and direct lender perspectives from the unique position of having both borrower and lender side capabilities, hosted by Refinitiv LPC. Presented by moderator Tomasz Kulawik (Washington, DC-Finance) and panelists Heather Waters Borthwick and Gus Atiyah (both New York-Finance).

Perspective

Four Key Areas in M&A and Governance Boards Should Focus on Post Pandemic

September 17, 2021

Global Managing Partner and Global Head of M&A George Casey authored an article for Corporate Board Member on the emerging areas of focus that corporate boards should concentrate on in a post-pandemic environment.

Perspective

A New Look for Hong Kong Private Equity Funds

September 15, 2021

Asia Regional Managing Partner and Head of Greater China Lorna Chen was quoted by Caixin Weekly in the article titled “A new look for Hong Kong private equity funds.”

Perspective

EU Court Undercuts Investment Protections in the Energy Charter Treaty for Intra-EU Investors

September 13, 2021

On September 2, 2021, the Court of Justice of the European Union delivered a judgment in Republic of Moldova v Komstroy LLC (C-741/19) which held that Article 26(2)(c) of the Energy Charter Treaty is incompatible with European Union law insofar as it provides for investment arbitration proceedings between a Member State and an investor of another Member State. The CJEU’s judgment in Komstroy is the latest measure in the EU’s recent efforts to reform investor-State dispute settlement within the EU.

Perspective

SALT Deduction Workarounds Create M&A Structuring Opportunities

September 10, 2021

Any company engaging in sell-side M&A activities should consider the potential tax savings stemming from the recent enactment of state tax laws that allow entities classified as partnerships or S corporations for U.S. federal income tax purposes to elect to pay entity-level state income tax. In addition to the potential U.S. federal income tax savings that may arise as a result of such an election to pay PTE Tax on a Pass-Through Entity’s ordinary course operating income, such an election, under the right set of facts, may provide significant tax savings to owners of a Pass-Through Entity that disposes of its business in a transaction treated as an asset sale for U.S. federal income tax purposes.

Perspective

Fintechs May Be Subject to the Bank Service Company Act—and Not Even Know It

September 09, 2021

As the relationships between traditional banks and financial technology companies (“fintechs”) become more complex and interconnected, greater regulatory scrutiny over these relationships is a certainty. The Bank Service Company Act (“BSCA”), an old law that is getting newfound attention, provides one avenue for the U.S. federal banking agencies to learn of the existence of certain relationships between banks and fintechs. This is because the BSCA requires banks to notify their banking regulators of contracts and relationships with technology service providers and other companies that provide services to them. However, it does not require banks to notify their service providers that they have been so identified. As a result, many fintechs and other bank service providers may be completely in the dark as to their status under the BSCA and potential exposure under federal banking law and regulation.

Perspective

Realizing the Benefits of an Effective Legal function in Financial Institutions

September 08, 2021

With the inexorable rise and expansion of Risk and Compliance departments, aspects of the role of the Legal department and external legal advice in a global financial institution have been diminishing for a number of years, potentially to the detriment of risk management. To establish a fully effective Legal function, firms should at least ensure that the following steps are taken: position Legal appropriately within the governance structure of the organization; drive collaboration between Risk and Compliance, and Legal; ensure the Legal function itself and the lawyers within it are equipped with the skills to support most effectively the whole institution; and appropriately involve external legal advisors.