United States: Comparison Of New EU Proposals On Proprietary Trading And Ring-Fencing Against US, UK, French And German Rules

The European Commission has published a legislative proposal that would prohibit certain large EU banks from engaging in selected types of risky proprietary trading. The proposal would also potentially require such banking groups to push out and ring-fence certain other high-risk trading activities. The UK, France and Germany have already adopted separate national ring-fencing legislation, while in the US the Volcker Rule, which bans proprietary trading, is now in final form. International banking groups will need to continue work on restructuring their businesses to comply with the overlapping and at times inconsistent sets of rules. This note summarises the key provisions of each measure.

INTRODUCTION

The European Commission has published a draft regulation (the "Proposed Regulation") to prohibit certain large and systemically important banks from proprietary trading.1 The Proposed Regulation also gives national regulators in the EU various powers to require 'risky' trading activities (including market-making, securities underwriting, securitisation and complex derivatives) to become ring-fenced within those institutions into a separate legal entity from the retail bank. A retail bank is one that takes insured deposits under the Deposit Guarantee Scheme Directive.

The measures reflect and expand upon proposals originally included in the Liikanen Report.2 They go further than the Liikanen Report by imposing an outright ban on proprietary trading. If the Proposed Regulation is approved by June 2015, the ban on proprietary trading would apply from 1 January 2017 and the ring-fencing powers would come into effect from 1 July 2018.

In the US, the Volcker Rule imposes a general prohibition on banking entities and their affiliates from engaging in proprietary trading, subject to various exemptions.3 Some EU Member States have already enacted legislation providing for national bank ring-fencing requirements, and the intention in many cases was for these to be an alternative to a proprietary trading ban, as imposed by the Volcker Rule. In the UK, the Financial Services (Banking Reform) Act 2013 (the "UK Act"), which implements the reforms proposed by the Independent Commission on Banking, requires deposit-taking banking services to be ring-fenced from proprietary trading and other related activities.4 Recent French and German legislation also requires banks and banking groups to separate their proprietary trading and certain other high risk activities from their deposit-taking business.5 However, the Proposed Regulation is essentially a "Volcker Rule-lite," plus a form of ring-fencing (lite).

The Proposed Regulation includes an option for Member States to apply to the European Commission for a derogation decision to exempt a bank from the ring-fencing requirements of the Proposed Regulation if the bank is already subject to a national ring-fencing regime that meets similar standards. The decision applies to instances where national primary legislation had been adopted prior to 29 January 2014 (including secondary legislation subsequently adopted), which covers the UK, France and Germany. In the event that the technical standards mandated by the Proposed Regulation create further discrepancies between the pan-European regime and pre-existing national regimes, the use of derogation decisions may become increasingly desirable for European banks seeking to avoid multiple ring-fences. No statements have currently been made by any major European governments or regulators on their intention to rely on these derogation provisions and it is somewhat unclear whether they will be able to do so. The test for similarity appears to favour the UK and French reforms, though it is hard to believe the German would not be recognized also (perhaps with minor adjustment).

The UK Act requires regulators to review, within 12 months of the UK's ring-fencing requirement taking effect (currently expected in 2019), proprietary trading activities engaged in by all regulated financial institutions in the UK (and not just deposit-taking banks). The UK regulators are also required to review the UK's ring-fencing rules themselves within five years. It is therefore not yet clear whether the UK would rely on derogation decisions or instead seek to align its approach with that under the Proposed Regulation.

The table at the end of this note compares the Proposed Regulation with current requirements in the US, UK, France and Germany. While these regimes may, at first glance, appear similar, international banking groups will need to undertake detailed analysis to ensure they are appropriately structured to comply with each applicable requirement.

SCOPE OF PROPOSED REGULATION AND IMPACT OF VOLCKER RULE ON BANKS ESTABLISHED OUTSIDE THE US

Proposed Regulation

The requirements of the Proposed Regulation will apply to "credit institutions" and "EU Parents." "Credit institutions" comprise, essentially, banks regulated in the EU. "EU Parents" include holding companies in the EU of groups that include credit institutions. The following organisations will be covered by the Proposed Regulation:

EU credit institutions and banking groups headquartered in the EU

  • any credit institution or EU Parent identified as being a global systemically important institution ("G-SII") under the EU's Capital Requirements Directive IV ("CRD IV") (and all their branches and subsidiaries wherever located) (the "G-SII test"); or
  • any EU credit institution or EU Parent with a credit institution established in the EU (and all their branches and subsidiaries, wherever located) where, for a period of three consecutive years, its total assets amount to at least €30 billion and it has trading activities amounting to at least €70 billion in combined value or 10% of its total assets (the "size test");

Credit institutions and banking groups outside the EU

  • the EU bank sub-group that meets one of the above tests, with all the branches of the EU entities and subsidiaries which drop down below the EU entities; and
  • an EU branch of a third country (e.g. US) bank provided that it meets the size test.

However, the European Commission would be entitled to determine that a third country regulatory regime is "equivalent" to the requirements under the Proposed Regulation, comprising both the proprietary trading ban and the ring-fencing requirement. For this test to be met, the third country's legal framework must be capable of recognizing structural measures provided for in the laws of other countries. The Commission FAQs on the Proposed Regulation imply that it is intended that the US is capable of being equivalent given various provisions of Bank Holding Company Act legislation which predate Volcker. Notably, the US regime is technically able to take into account the Proposed Regulation, though whether this ends up being the case in practice remains to be seen. Presumably the intent behind the Proposed Regulation is a grand negotiation on the topic between the EU and US. As in other recent EU legislation (e.g. EMIR), the equivalence determination is at the discretion of the European Commission.

Where the European Commission makes an equivalence determination, the Proposed Regulation will not apply to:

  • EU branches of that third country's credit institutions; or
  • third country subsidiaries of EU Parents.

Where there is no equivalence between the Proposed Regulation and the third country regime, a national regulator may exempt a third country subsidiary of an EU Parent from the structural split requirement provided that a resolution plan is agreed between the group level EU authority and the third country host authority and the resolution strategy has "no adverse effect on the financial stability of the member state where the EU Parent and other group entities are established."6 In other words, where (most likely) an effective multiple point of entry resolution strategy is implemented, a national regulator will have the power to exempt a third country subsidiary of an EU Parent.

Comparison with Jurisdictional Scope of the US Volcker Rule

The Volcker Rule similarly has some level of extraterritorial reach. In addition to domestic institutions, it applies to the banking operations of banking groups headquartered outside the United States, subject to certain key exemptions. The main exemption in this context is the "solely outside the United States" or "SOTUS" exemption. The SOTUS exemption is available where, in respect of a purchase or sale of a financial instrument for a trading book:

  • the banking entity headquartered outside the United States acts as principal outside the United States;
  • the entity and relevant personnel that make the trading decision are located outside the United States;
  • trading is not accounted for as principal in the United States;
  • a US affiliate does not provide financing for the trading; and
  • the trading is not conducted with or through any US entity, other than on an anonymous basis on a US exchange or through a US central counterparty, or in a transaction with the non-US operations of a US entity.7

Interaction of EU and US Regimes International Banking Groups

Unless and until the European Commission deems the US regime equivalent to the Proposed Regulation, there is the potential for substantial overlap and even conflict between the Proposed Regulation and the Volcker Rule.

Many large US-headquartered banking groups currently operate in the EU through branches. If the European Commission makes an equivalence determination with respect to the US, a US bank operating in the EU through a branch would not be subject to the Proposed Regulation. An EU subsidiary of a US bank would be subject to both the Proposed Regulation and the Volcker Rule unless an exemption applied under the US regime.

Given the difficulties of applying different proprietary trading standards in different countries, many banking institutions may well choose to comply with the more restrictive standards globally.

PROHIBITION ON PROPRIETARY TRADING

The Proposed Regulation prohibits in-scope entities from engaging in proprietary trading in financial instruments and commodities. Whereas the in-scope entities under the Proposed Regulation are limited to EU credit institutions having total assets of more than €30 billion, or who are already deemed to be "globally systemic," the Volcker Rule applies the prohibition on proprietary trading to a broader group of "banking entities," that includes any insured depository institution, its holding company, a bank headquartered outside the United States that is treated as a bank holding company under the International Banking Act of 1978, as amended, and any subsidiary or affiliate of any of these entities.

The Proposed Regulation also defines "proprietary trading" more narrowly compared to the UK Act and the Volcker Rule. Unlike the UK Act and the Volcker Rule, the definition does not start with reference to the EU activity of "dealing in investments as principal" or "engaging as principal," respectively. Instead, a new definition is proposed of using own capital or borrowed money to take positions in any type of transaction regarding a financial instrument or commodity for the sole purpose of making a profit for one's own account. Any purpose connected to actual or anticipated client activity or hedging the entity's risk as a result of actual or anticipated client activity would mean the trade falls outside the definition.

The Volcker Rule adopts a broader definition of proprietary trading, where any short-term principal trading (of securities, derivatives or futures contracts) by a banking entity that does not fall neatly within one of the enumerated exemptions (discussed further below) will be presumed to be prohibited proprietary trading for purposes of the Rule. The Volcker Rule also adopts a wider and more objective view by relying on the trading desk as the smallest discrete unit of organization to measure compliance with the Rule's restrictions and limitations. Proprietary trading under the Proposed Regulation is limited to activity conducted through the use of desks, units, divisions or individual traders specifically dedicated to such position taking and profit making, including through dedicated web-based proprietary trading platforms.

Presumably the final text of the Proposed Regulation will not allow self-made structures which feed client and proprietary trading into the same desk, thereby falling outside the definition. However, nevertheless, the intention appears to be to impose a version of the Volcker Rule that is narrower and less objective than that being imposed in the US, with the ring-fencing provisions being included as a fail-safe.

As a result of this narrow definition, hedging, market-making and underwriting activities would generally be outside the ban, albeit such activities may be subject to ring-fencing instead. Specifically, market-making, the issuance, investment and sponsorship activities linked to risky securitizations and the structuring, arranging and execution of complex derivatives are intended to subject to the structural separation requirement rather than the proprietary trading ban.

There is also a specific exemption for trading in debt issued by Member States. The Volcker Rule contains an exemption for trading in securities linked to the US sovereign debt, which was extended recently to cover certain kinds of non-US sovereign debt, so this exception is broadly equivalent to that in the US. There are also exemptions for cash management and trading in cash and cash equivalent instruments (defined as being of less than 397 day maturity with returns no greater than the rate of return of three-month high quality government bonds).

There is a prohibition on investment in alternative investment funds ("AIFs"), derivatives linked to AIFs or shares or units in an entity that invests in AIFs. Investments are permitted in closed-ended and unleveraged AIFs, EU venture capital funds, EU social entrepreneurship funds and EU long-term investment funds. Each of these must be established in the EU under the Alternative Investment Fund Managers Directive ("AIFMD"), or established elsewhere and marketed into the EU in accordance with the AIFMD.

There is also a prohibition on investing in entities that engage in proprietary trading.

The management of entities subject to the ban will be required to ensure compliance. Remuneration arrangements are required to contribute to the prevention of circumvention of the ban.

MANDATORY SEPARATION OF OTHER HIGH-RISK TRADING ACTIVITIES

The European Commission has stated that it believes that legal separation of certain particularly risky financial activities within a large banking group is also crucial for a safe and efficient EU banking system. Under the Proposed Regulation, any such separation would be independent of an assessment of a bank's recovery and resolution plan which may call for additional separation if deemed necessary (under the current version of the proposed Bank Recovery and Resolution Directive, which is still subject to the EU legislative process).

National regulators will be obliged to review the trading activities of in-scope entities at least annually with a view to determining whether the trading business should be required to be split, and ring-fenced from, the retail bank. The review must include an assessment of certain metrics, which if exceeded result in a decision by that national regulator that the retail bank must not carry out trading activities. These metrics include relative trading book size (trading assets divided by total assets), leverage (trading assets divided by core Tier 1 capital), counterparty credit risk (fair value of derivatives divided by total trading assets), complexity (measured largely by reference to derivatives), profitability (trading income divided by total net income), associated market risk (difference between trading assets and liabilities in absolute value, divided by average of trading assets and trading liabilities), interconnectedness (based on CRD IV criteria), and finally credit and liquidity risk from commitments and guarantees.

Particular assessment is to be made of market-making given its risks and interconnectedness. Similar scrutiny is to be made of securitization, which is seen as giving risk to significant liquidity risk. The EBA will draft Regulatory Technical Standards ("RTSs") which will be endorsed by the European Commission. The Commission will specify the relevant limits of the metrics, how many metrics must be exceeded for the test for separation to be met, as well as the level of aggregate significant risk being measured.

If these metrics are met and the national regulator determines there is a risk to the financial stability of the retail bank or the EU financial system as a whole, the process for splitting off the trading businesses will be triggered unless the institution can demonstrate the lack of any such risk to the satisfaction of the national regulator. Further, the national regulator can order a split if it identifies a risk to the stability of the bank or the EU financial system regardless of the metrics being surpassed. The Commission will specify what sorts of securitization do not propose a threat to the financial stability of the core credit institution or the EU financial system as a whole.

If such trading activities are required to be separated, they would need to be assigned to a separate legal entity (a "trading entity") pursuant to an agreed separation plan. The retail bank will only be able to carry on trading in order prudently to manage its capital, liquidity and funding, for which it can only use interest rate, FX and credit derivatives eligible for CCP-clearing, unless the Commission adds to that list, in order to hedge overall balance sheet risk. The hedging must mitigate individual or aggregate positions. In addition, the bank may provide risk management services to clients.

Ring-fenced entities must have strong independent governance and address regulatory capital and large exposures on a functional sub-group basis.

Remuneration practices must be aimed at hedging being determined by reference to its effectiveness in reducing risk, not on profits.

COMPLIANCE

The Proposed Regulation requires the disclosure of information to regulators in order to ensure that the calculation of assessments is possible as well as to facilitate the monitoring of compliance with the requirements. Further, transactions, document systems and processes must be registered with regulators to enable the regulators to monitor compliance.

There are provisions for the imposition of administrative sanctions against corporate entities and individuals (management) responsible for breaches. Member States are permitted also to apply criminal sanctions for breaches of the ban on proprietary trading and any manipulation of information on trading activities that is submitted to regulators.

INTERACTION OF THE PROPOSED REGULATION WITH THE UK ACT AND THE VOLCKER RULE

At a high level there are arguably subtle differences of intent between the various key regimes. The European Commission's primary objective is to isolate risky trading activity and eliminate purely speculative trading. The UK Act primarily seeks to protect deposit-taking banks from risks generated by the investment banking part of the wider group where, ultimately, a taxpayer-funded bail-out might be required to prevent depositor runs. The Volcker Rule, in contrast, is motivated by philosophical concerns that banks should exist only to do customer business.

The Proposed Regulation's requirements are not as strict as, and are in some ways more flexible than, the UK Act and the Volcker Rule. The ban on proprietary trading is in principle narrower than the Volcker Rule, requiring fewer exceptions to be developed. The provisions will apply the ring-fence - but not a ban - to many trading and investment banking activities such as lending to venture capital and private equity funds, investment and sponsorship of risky securitisation, and the sale and trading of derivatives. The ability to ring-fence such trading activities, rather than an outright ban in relation to some aspects of these as per the Volcker Rule, provides greater flexibility for banks in the types of activities they can undertake. Further, under the Proposed Regulation, ring-fencing is not automatically mandatory, but is at the discretion of national regulators on a case-by-case basis, albeit subject to the harmonised metrics set by the EBA. This makes the ring-fencing provisions more flexible than the UK Act, which provides a mandatory ring-fence of all deposit-taking activity. However, as neither the EBA metrics nor the UK secondary legislation are finalised, developments will need to be monitored. Moreover, national derogations may be used instead of the regime under the Proposed Regulation.

Unless derogations are used, it is possible that the combined effect of the Proposed Regulation and the UK Act will be to require some of Europe's largest banks to construct two ring-fences: one around their retail arm (as required by the UK Act) and one around their trading activities (as set out in the Proposed Regulation), in addition to satisfying any additional ring-fencing requirements under French or German legislation. Non-US banks would also need to ensure compliance with the SOTUS and other applicable exemptions for their operations outside the US to ensure they remain outside the scope of the Volcker Rule. US banks will likely ensure compliance with the Volcker Rule as a first step before looking at the EU or UK regimes, given that the Volcker Rule is more burdensome than either of these two regimes in most respects.

ANTI-AVOIDANCE MEASURES: NEW EU RULES REGARDING SFTS

The European Commission published a draft regulation on the reporting and transparency of securities financing transactions (the "SFT Regulation")8 on the same day as the Proposed Regulation. The SFT Regulation applies to repurchase transactions (as defined in the Capital Requirements Regulation ("CRR")),9 securities or commodities lending and borrowing, and any transaction having an equivalent economic effect and posing similar risks such as buy-sell back or sell-buy back transactions (collectively defined as securities financing transactions ("SFTs")). The SFT Regulation is aimed at increasing transparency in the shadow banking sector and squeezes the brakes on collateral velocity, a phenomenon prevalent in the shadow banking arena. The goal is to mitigate contagion and systemic risk contributed by shadow banking transactions but at the cost, perhaps, of increasing the scarcity of collateral at a time when there is increasing demand for high quality collateral.

The key requirements of the SFT Regulation are:

  • counterparties to SFTs will have to report such transactions to a registered trade repository and keep records of SFTs that they report. Counterparties for this purpose include EU financial counterparties and their branches (wherever located), non-financial counterparties (as defined in EMIR), non-EU counterparties (if the transaction is concluded in the course of operations of an EU branch) and central counterparties;
  • management companies of undertakings for collective investment in transferable securities ("UCITS"), UCITS investment companies and alternative investment fund managers will have to inform their investors on the use they make of SFTs as well as other financing structures and will have to include information on the SFTs they are authorized to use in pre-investment documents; and
  • counterparties will have to meet minimum conditions if they wish to rehypothecate financial instruments including obtaining written consent of the collateral provider, disclosure of the risks to the collateral provider (in particular the potential risks in the event of the default of the counterparty) and the transfer of the financial instruments received as collateral to an account in the name of the receiving counterparty. Counterparties for this purpose include EU financial counterparties and their branches (wherever located), non-financial counterparties (as defined in EMIR), non-EU counterparties (if the rehypothecation is concluded in the course of operations of an EU branch or an EU counterparty or an EU branch is the provider of the collateral).

It is expected that the SFT Regulation will enter into force by the end of 2015. The reporting requirement will apply 18 months after the SFT Regulation comes into force and the requirements relating to reporting by fund managers to investors will apply six months after the SFT Regulation enters into force.

To read this article in full, please click here.

Footnotes

1 The Proposed Regulation is available at: http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:52014PC0043:EN:NOT.

2 The Liikanen Report is available at: http://ec.europa.eu/internal_market/bank/docs/high-level_expert_group/report_en.pdf.

3 Previous client notes on the Volcker Rule are available here.

4 The UK Act is available at: http://www.legislation.gov.uk/ukpga/2013/33/contents/enacted/data.htm and our client note on the same is available here.

5 The Act on Ring-fencing and Recovery and Resolution Planning for Credit Institutions and Financial Groups is available at http://www.bundesrat.de/cln_330/SharedDocs/Drucksachen/2013/0301-400/378-13,templateId=raw,property=publicationFile.pdf/378-13.pdf. The Law of 26 July 2013 on the Separation and Regulation of Banking Activities (Law no. 2013-672) is available at http://www.legifrance.gouv.fr/affichTexte.do?cidTexte=JORFTEXT000027754539.

6 Proposed Regulation, Article 4(2).

7 79 Fed. Reg. 5535, at 5786 (Jan. 31, 2014).

8 The proposed SFT Regulation is available at http://ec.europa.eu/internal_market/finances/docs/shadow-banking/140129_proposal_en.pdf.

9 The CRR is available at http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2013:176:0001:0337:EN:PDF.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Barnabas W.B. Reynolds
Similar Articles
Relevancy Powered by MondaqAI
 
In association with
Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions