Cayman Islands: "Weavering Macro Fixed Income Fund Limited (In Liquidation) v Peterson And Ekstrom": Hedge Fund Directors Are Told To Jump, But How High?
The Financial Services Division of the Grand Court has just
delivered what is already being hailed as a seminal judgment on the
subject of directors' duties in the context of offshore hedge
funds.
In Weavering Macro Fixed Income Fund Limited (In
liquidation) v Peterson and Ekstrom, after a full trial the
Court found a fund's independent directors guilty of wilful
default in the discharge of their duties, and ordered them to pay
damages to the fund's liquidators in the sum of USD 111
million, representing the losses suffered by the fund which were
caused by their default.
The findings recorded in the judgment suggest it was a case of
extreme facts: the fund's investment manager arranged the
appointment of two relatives to serve as the fund's directors
on a gratuitous basis. This was purportedly done in order to meet
certain minimum legal requirements....
Specific Questions relating to this article should be addressed directly to the author.
In recent months Argentina has been experiencing both formal and informal additional foreign exchange restrictions both to purchase in the country and to transfer foreign currency abroad.
Through two new regulations, the Ministry of Economy and the Central Bank reduced the terms for the liquidation of foreign exchange proceeds from exports.
Until March 30, 2012, Brazilian
financial institutions did not require the approval of the
Brazilian Central Bank or other authorities to directly or
indirectly invest in the capital stock of other legal entities
either in or outside Brazil.
On April 24, 2012, the Board of
Directors of the Central Bank of Brazil (Banco Central do
Brasil – Bacen) decided to adopt new rules for
merger and acquisition (M&A) transactions involving two or
more financial institutions or other similar entities duly
authorized to operate in Brazil by Bacen, and from now on Bacen may
require that the efficiency gains resulting from this type of
operation be shared with the consumers.
The "Novo Mercado" is a listing segment created by the Brazilian Securities, Commodities and Futures Exchange ("BM&FBOVESPA S.A – Bolsa de Valores, Mercadorias e Futuros" – BVMF) and designed for shares issued by companies that voluntarily undertake to abide by good corporate governance practices and transparency which are more rigid than those already required by the Brazilian legislation and by the Brazilian Securities and Exchange Commission ("Comissão de Valores Mobiliários" - CVM).
By means of Decree No. 7683, of
February 29, 2012 (Decree 7683/2012), published in the Official
Gazette of the Union of March 1st, 2012, the Brazilian
Federal Government decided to increase from two to three years the
term of the foreign currency loans which are subject to the tax on
exchange transactions (IOF) at the rate of 6%.
On April 25, 2012, the Brazilian Securities and Exchange Commission (Comissão de Valores Mobiliários - CVM) issued CVM Instruction No. 521 (CVM Instr. 521/2012), regulating the activity of credit risk rating (classificação de risco de crédito) in the Brazilian securities market, with emphasis on registration and recognition requirements, information disclosure, and rules of conduct and internal controls of the credit rating agencies (CRAs).
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