United Kingdom updates

Arbitration & ADR

Contributed by Clifford Chance
Serious irregularity challenge to arbitral award upheld where ambiguity prevented enforcement
  • United Kingdom
  • 30 April 2020

In a recent case, the High Court upheld the claimants' challenge to an award made under Section 68 of the Arbitration Act. Uncertainty as to the identities of the parties to an arbitration agreement and underlying contract had led a Chinese court to refuse to enforce the award. The High Court determined that there was uncertainty or ambiguity as to the award's effect and remitted the award to the tribunal.

Court confirms power to order taking of evidence from non-parties to a foreign-seated arbitration
  • United Kingdom
  • 23 April 2020

The Court of Appeal recently considered whether Section 44(2)(a) of the Arbitration Act empowers the courts to issue orders for taking the evidence of a witness who is resident in the United Kingdom but not a party to an arbitration agreement. The judgment offers much-needed guidance for parties which have identified non-party witnesses who hold potentially relevant evidence but are unwilling to give evidence voluntarily.

High Court rejects jurisdictional challenge to investment treaty arbitration award
  • United Kingdom
  • 19 March 2020

In a rare consideration of an investment treaty award, the High Court broadly interpreted the meaning of 'investor' and 'investment' in the bilateral investment treaty between the governments of South Korea and Iran. The decision is also interesting in its comment that the question of attribution is not a jurisdictional issue.

Court of Appeal dispenses with service of enforcement of arbitral award against sovereign state
  • United Kingdom
  • 23 January 2020

The Court of Appeal recently considered whether service of formal court documentation on a state party was a necessary requirement when seeking to enforce an arbitral award against it or whether service could be dispensed with in certain circumstances. The significant judgment will have implications for cases in which it may be very difficult to enact service of enforcement proceedings on a state through diplomatic channels.

Clarity over English court's jurisdiction to grant anti-arbitration injunction against foreign-seated arbitrations
  • United Kingdom
  • 26 September 2019

The Court of Appeal has partly upheld, and partly dismissed, an injunction granted by the High Court to restrain an arbitration seated in Lebanon. In so doing, the Court of Appeal has confirmed the English court's power to grant anti-arbitration injunctions pursuant to Section 37(1) of the Senior Courts Act 1981 in respect of a foreign-seated arbitration where the dispute does not fall within the scope of the arbitration agreement and the proceedings are, or would therefore be, vexatious and oppressive.


Aviation

Contributed by Vedder Price PC
Court ruling shows importance of standard representations and warranties in aircraft leases
  • United Kingdom
  • 20 May 2020

A recent High Court case demonstrates the utility and importance of including standard representations and warranties regarding power, authority and validity in aircraft leases, including as an estoppel against a defendant's claim that a lease is void and unenforceable as a result of alleged breaches of foreign public procurement legislation and lack of authority. The decision also illustrates the benefit of choosing English law to govern aircraft lease transactions, particularly between international parties.

Court of Appeal decision on economic duress in aviation market
  • United Kingdom
  • 28 August 2019

A recent Court of Appeal decision regarding a claim of economic duress against an airline reinforced the fundamental importance of ensuring contractual clarity and certainty as a matter of English law. For companies operating in the aviation sector, where there may be an unequal power dynamic, parties will be unable to look to economic duress to undo a lop-sided bargain unless there is some unlawful action or provable bad faith on the part of the party with greater power.

Aircraft Purchase Fleet Limited sought $260 million in damages from Compagnia Aerea Italia
  • United Kingdom
  • 20 February 2019

In a recent High Court Case, Aircraft Purchase Fleet Limited (APFL) sought $260 million in damages from Compagnia Aerea Italia (CAI) for an alleged repudiatory breach of a framework agreement under which CAI had agreed to lease certain new Airbus A320 family aircraft. APFL had agreed to buy these aircraft from Airbus. However, CAI argued that it had become impossible for either party to perform the framework agreement following Airbus' termination of its obligations to sell aircraft to APFL.

Drones – the rise of the Basic Regulation
  • United Kingdom
  • 03 October 2018

In July 2017 the government released proposals to regulate the use of drones in the United Kingdom. Since then, the regulation of drones has been transferred to the European Union and now falls under the EU Basic Regulation. Many of the UK government's proposals for drone operators are included in the EU Basic Regulation, which sets the groundwork for establishing rules that will require operators of drones that weigh 250kg and above to register them and ensure that they are marked for identification.

Slots can be traded for value even after insolvency
  • United Kingdom
  • 16 May 2018

Monarch Airlines Limited's administrators have won an appeal with the Court of Appeal regarding Monarch's rights in and to certain 'slots' at Luton and Gatwick airports after it went into administration. The case is significant, as it reaffirms the value ascribed to slots by airlines and their financiers as rights of the airline and the fact that, as a result, they can be traded for value even after insolvency.


Banking

Contributed by Allen & Overy LLP
Cryptocurrency treated as property in freezing order
  • United Kingdom
  • 21 February 2020

The High Court recently granted a freezing order over £1.5 million worth of bitcoin and ethereum cryptocurrency against a trading platform and its directors in only the second known example of the court treating cryptocurrency as property. This decision will provide further reassurance of the English courts' willingness to deal with cryptocurrency as property.

EUR wrong: when sterling means euros
  • United Kingdom
  • 18 January 2019

The High Court recently used interpretation rather than rectification to fix an unhappily drafted loan agreement for "Seven Million Five Hundred Pounds [sic] (£7,500,000) to be drawn down in Euros". The dispute concerned whether the amount owed was in sterling or euros.

Three strikes and you're out – bank's duty to make inquiries of suspicious transactions
  • United Kingdom
  • 07 December 2018

A first-instance court recently considered the extent to which a bank's duty of care owed to its customers, co-existing in contract and tort, requires the bank to make inquiries of suspicious transactions in their bank accounts. The court found in favour of the bank on the basis of expiry of the relevant limitation period. This article focuses on the court's discussion, by way of obiter, of the bank's duty of care owed to its customers where suspicious transactions occur.

Redressing the balance: banks owe no contractual duty to customers in respect of regulator-mandated reviews
  • United Kingdom
  • 19 October 2018

A recent decision gave Court of Appeal endorsement to a raft of similar first-instance decisions regarding banks' contractual duties to customers in respect of regulator-mandated reviews. The decision provides helpful comfort for banks when agreeing remedial action with the Financial Conduct Authority that they ought not to be exposing themselves to private actions from customers in respect of their review, provided that third-party rights are excluded.


Capital Markets

Cornerstone investments in UK initial public offerings
  • United Kingdom
  • 21 April 2020

As issuers and selling shareholders seek to de-risk initial public offerings (IPOs) in the United Kingdom, it is likely that there will be further cornerstone investments when the IPO market returns. Further, the impact of the COVID-19 pandemic on both the capital markets and the economy more generally may well mean that cornerstone investments become even more critical to the successful execution of IPOs.

Listing sovereign-controlled companies in the United Kingdom
  • United Kingdom
  • 11 December 2018

The listing regime for the United Kingdom's Official List is divided into premium and standard listing segments. For admittance to the premium listing segment, an issuer must meet higher UK-specific standards that are intended to provide additional investor protection and promote shareholder confidence. The UK Financial Conduct Authority recently introduced a new category, but issuers have yet to avail themselves of the new regime.

New IPO process in practice: emerging trends?
Davis Polk & Wardwell LLP
  • United Kingdom
  • 20 November 2018

The Financial Conduct Authority recently implemented changes to the initial public offer (IPO) regime that have had a fundamental impact on the process of conducting an IPO in the United Kingdom. Companies including Aston Martin and Funding Circle have had to negotiate these new rules in practice over the past few months and certain trends are now beginning to emerge.


Competition & Antitrust

Contributed by Gowling WLG
UK competition authority continues to penalise individuals for competition law infringements
  • United Kingdom
  • 12 September 2019

The Competition and Markets Authority (CMA) recently publicised the disqualification of three individuals from acting as directors as a consequence of their company's involvement in an infringement of UK competition law. In view of the CMA's commitment to enforcement actions and to ensuring that directors are held personally responsible for competition law compliance, individuals and organisations should, among other things, proactively consider the extent of any potential exposure that they may face.

Investment planning: factoring in UK merger control regime
  • United Kingdom
  • 29 August 2019

The acquisition of a minority shareholding (which satisfies the jurisdictional criteria under the UK merger control regime) without obtaining clearance presents a range of legal and commercial risks for parties, including that the Competition and Markets Authority could ultimately order the acquisition to be undone. This article highlights some ways for parties to identify and understand the extent of the risks of an acquisition.

Acquisitions of minority shareholdings under UK merger control regime
  • United Kingdom
  • 15 August 2019

The Competition and Markets Authority can open an investigation and impose initial enforcement orders where it has reasonable grounds to suspect that two or more enterprises have ceased to be distinct. This includes circumstances in which an acquirer purchases only a minority shareholding in the target because, under the UK merger control regime, two or more enterprises cease to be distinct where they are brought under common ownership or common control.

Use of IEOs in completed transactions
  • United Kingdom
  • 08 August 2019

Where the Competition Market Authority (CMA) opens an investigation into a completed transaction, it will generally impose an initial enforcement order (IEO). In addition, the CMA can impose IEOs in the context of planned transactions, but anticipates that it will do so relatively rarely in practice. In the context of a completed transaction, an IEO aims to ensure that the acquired business continues to compete with the acquiring business and is maintained as a going concern during the course of the CMA's investigation.

Competition and Markets Authority's ability to investigate completed transactions
  • United Kingdom
  • 01 August 2019

Under the UK merger control regime, while parties can notify transactions and obtain clearance from the Competition and Markets Authority (CMA) before completion, there is no legal requirement to do so. However, if parties do not obtain clearance before completion, the CMA can still investigate. Therefore, a completed transaction is potentially at risk of investigation during the four-month statutory period.