Aide memoire of the 12th meeting of the European Financial Markets Lawyers Group

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12th meeting of the European Financial Markets Lawyers Group

Thursday, 30 October 2003

Room CI, 36th floor, at the ECB in Frankfurt

Agenda

ITEM 1: Approval of the agenda and of the aide-mémoire of the last meeting

ITEM 2: Netting related issues

(a) Enforceability of insolvency close-out netting arrangements under EU legislation

As a follow-up to the last EFMLG meeting, the sub-group on netting issues has prepared a draft letter to the European Commission expressing the EFMLG's views regards enforceability of insolvency close-out netting arrangements on the Collateral and Winding-up Directives. The EFMLG is invited to discuss and possible endorse the letter which could be sent subsequently to the Commission.

Furthermore, a representative of the ECB juristes-linguistes services will present the findings of a comparative survey made within existing Community legal acts on the use of the terms set-off, netting and related definitions. The survey is analysing the terminology used in all official languages of the EU.

In addition, it could be considered whether it would be useful to link this exercise with the work that is currently being undertaken by major international law firms, sponsored by ISDA , aiming at providing for the most appropriate definition of netting-related provisions in the EU Insolvency Regulation and the Winding-up Directive. The initiative will be presented by Mr Peter Werner from ISDA together with a draft note, prepared by a working group under the auspices of ISDA and dealing with the interpretation of Art. 6 of the EC Insolvency Regulation. The members of the EFMLG are invited to considered, if it is felt useful to combine efforts and possibly to have a joint declaration by the law firms, ISDA and the EFMLG on this matter.

Documents: Draft letter to the Commission, Contribution of the ECB juristes-linguistes on the terms netting and set-off, Draft note on Art. 6 of the Insolvency regulation

(b) Netting arrangements in the acceding countries

This issue was linked to topic number 1, when it was presented to the group in its June meeting. Given the scarcity of information and the interest that the financial community has in getting first hand information on the validity and enforceability of netting agreements in the acceding countries , it is suggested that a survey could be prepared with input from those members of the EFMLG, whose institutions have large scale activities in the acceding countries.

Document: Letter to the EFMLG members

ITEM 3: EFMLG/ACI Project on Short-term Securities

The group is invited to discuss the ACI/EFMLG Report on the Information Memorandum for Short-term European Paper (STEP) as well as an updated version of the EFMLG report on the legal aspects of short-term securities.

Documents: ACI/EFMLG Report on the Information Memorandum for Short-term European Paper (STEP) plus Annex 1, Annex 2, Annex 3, Annex 4, Annex 5; Updated version of the EFMLG report on the legal aspects of short-term securities

ITEM 4: General discussion on matters of relevance to the European Financial Markets

As it emerged from the discussion on the future of the EFMLG at the last meeting, the members have requested to be given the opportunity to have some time for an informal debate on actual topics

ITEM 5: Other matters

(a) Response of the EFMLG to the EU enlargement

The members are asked to consider how the EFMLG could respond to the EU enlargement. In particular it could be considered in which form the acceding countries could be represented in the EFMLG.

(b) Response of the EFMLG to the EU enlargement

In the context of the on-going policy debate on financial integration and the definition of a post-FSAP strategy, some selected legal issues related to cross-border banking consolidation will be brought to the attention of the EFMLG (e.g. merger control rules in the banking sector, the notion of legitimate interests under the European Merger Control Regulation and the notion of general good under EU financial law). The group is asked to discuss the possible impact of these issues and other recent EU company law developments for the financial sector and possibly to identify some elements which might be further examined.

(c) Legal framework for book-entry transfers

The group will be informed on the reactions on the publication of the EFMLG report on the legal framework for book-entry transfers in the European Union. In addition, the group could be informed of the ongoing discussions within the Commission on a Securities Account Certainty project, to which the EFMLG report is likely to serve as a supportive document. The EFMLG could consider whether and if so, how, they could support the Commission's Securities Account Certainty project.

Furthermore, the EFMLG could consider to respond to the Unidroit position paper on ‘Harmonised substantive rules regarding indirectly held securities' (September 2003).

Document: Unidroit position paper on ‘Harmonised substantive rules regarding indirectly held securities' (September 2003), Unidroit cover letter, EFMLG letter (November 2003), ESF letter (October 2003)

(d) Collective action clauses

The group will be informed about the activities of the sub-group. Depending on the results, it will be decided whether further activities will be undertaken.

(e) EFMLG website – restricted member area

The group will be informed about the progress on the establishment of a closed member area within the EFMLG website.

(f) Date of next meeting

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