Inside Africa blog

Legal developments around Africa

Recognition of EEA bail-in rights in Africa - update

Claire Edwards
Andrew Wood

At the end of 2015, the Loan Market Association and the Loan Syndications and Trading Association published suggested clauses for the contractual recognition of EEA regulators’ bail-in rights.  These clauses are suitable for use in finance documentation governed by the law of an African country.

By way of recap (see our earlier blog), EEA financial institutions (and their overseas branches) must now include a clause in their non-EEA law governed loan agreements, trade finance instruments and other agreements under which they have a payment or other liability specifying that those liabilities may be subject to bail-in by EEA regulators under the Banking Recovery and Resolution Directive (BRRD).  EEA member states were required to implement the contractual recognition requirements of Article 55 BRRD into national law by 1 January 2016.  To date 27 of the 31 member states have done so, with Poland, Iceland, Liechtenstein and Norway still to do so.

For more details on how the requirement will apply, what the recognition of bail-in clause should look like and the particular questions this poses for sectors like trade finance in Africa, have a look at our more detailed article here

About

Africa is as dynamic a market as it is diverse. We understand that changes impacting your business can arise rapidly and vary significantly across the continent.

Our understanding of Africa’s markets stems from extensive experience on the ground. Through our Inside Africa blog, we aim to apply this insight to provide you with timely commentary on the latest developments across Africa, as well as insight into the many nations that make up this vast continent.

Read more
Blog Network

Topics

Archives