Negotiations have concluded for the “Pacific Alliance – Singapore Free Trade Agreement” (PASFTA).

On July 22, 2021, Mr. Gan Kim Yong, Singapore’s Minister of Trade and Industry, together with his counterparts from the members states of the Pacific Alliance – Mexico, Chile, Colombia, and Peru, announced the conclusion of negotiations of the Pacific Alliance – Singapore Free Trade Agreement (PASFTA).

Singapore will become the first Asian-Pacific associate state of the Pacific Alliance (“PA” or “Alliance”) once the pact is signed, which is expected to happen by the end of the year. This is an important milestone in the economic integration between the PA region and Asia-Pacific and is a crucial development for the necessary economic reactivation of the two regions.

The Ministers of Trade agreed that the PASFTA represents an interest in the economic integration of the regions and the improvement of the commercial relationship, attracting investments and expanding access to goods and services. In particular, The PASFTA will enhance trade and deepen cooperation in areas like the digital economy, energy sector, technology, urban solutions, customs, maritime services, and infrastructure.

Latin American and Singapore businesses should take note of this development and where possible, take advantage of the significant trade opportunities and economic growth that this trade agreement will generate.

The Pacific Alliance: main objectives and member Continue reading “Negotiations have concluded for the “Pacific Alliance – Singapore Free Trade Agreement” (PASFTA).”

Down Round Fundraising: Some Insights

The spread of COVID-19 has undeniably driven the accelerated adoption of fintech solutions across Southeast Asia and leading fintech start-ups have in recent times found themselves to be in a good position to raise more capital. However, the harsher reality of the pandemic and the economic turmoil has in fact had a significant adverse impact on equity values and valuations of companies across the world, including Southeast Asia.

Start-ups looking to raise capital by across multiple rounds of fund raising may not be able to do so in the usual fashion where each subsequent round is closed at a higher price per share than the last. The spectre of “down rounds” or the issuance of shares at lower prices than previous rounds, is now an increasing reality.

For companies that have issued earlier rounds of convertible preferred equity, a down round is likely to result in the application of anti-dilution mechanisms attached to such preceding preferred equity.

This briefing will look into some anti-dilution mechanisms commonly adopted in convertible preferred equity, highlight the issues that both investors and issuers need to keep in mind when negotiating these provisions and briefly touch on possible alternatives to a down round.

Anti-dilution mechanisms

There are three common types of anti-dilution protection mechanisms used in convertible preferred equity. They are: Continue reading “Down Round Fundraising: Some Insights”

Is Knowledge King?

Knowledge is king”, so the adage goes.

What is the relationship between ‘knowledge’ and merger and acquisition (“M&A”) transactions? In M&A transactions, representations and warranties are made by the seller with respect to the target company. What does knowledge have to do with this? The answer is simple: risk allocation.

Representations and warranties not only serve to provide information to the buyer, but more crucially play the role of allocating risk as between buyer and seller. A seller will attempt to keep its representations and warranties as narrowly drawn as possible. A buyer, at the other end of the spectrum, will seek to have the seller’s representations and warranties pitched broadly.

During negotiations, one detail that lawyers lovingly quibble over are the ‘qualifiers’ to the representations and warranties. The categories of qualifiers are aplenty. The focus here will be on the introduction of ‘knowledge qualifiers’.

Assuming the parties have crossed the hurdle and agree to use a knowledge qualifier, that is not the end of the matter. Parties will still need to discuss the following: Continue reading “Is Knowledge King?”

헤지를 해야할지 말아야할지?

석유 가스 산업에는 헤징 계약이 잘 되어 있습니다. 이것은 끊임없이 변동하는 유가에 대한 위험을 줄이기 위해 사용되는 일반적인 위험 관리 조치입니다.  본질적으로, 헤징 계약에 따르면 기업들은 상품 교환(commodity swap)이나 옵션을 통해 고정 가격을 책정할 수 있습니다. 헤징 계약은 이 산업에 가장 기본적인 특징이며 대부분의 거래자들에게 당연한 것입니다. 그러나 이 당연함으로 인해 Apex Energy International Pte Ltd v Wanxiang Resources (Singapore) Pte Ltd [2020] SGHC 138이 고등법원과 항소법원에 제기 되었습니다. 싱가포르 법원은 매매계약 위반에 따른 헤징 약정이 Apex Eneergy의 합리적인 완화 조치인지 판단해야 했었고, 저희는 그들을 위해 헤징 약정이 합리적이라는 것을 증명하였습니다.

Continue reading “헤지를 해야할지 말아야할지?”

Duane Morris & Selvam acts on Union Bank’s INR 14.5 billion (US$200 million) QIP

SINGAPORE, 8 June 2021 – Duane Morris & Selvam LLP acted as international legal counsel to Elara Capital (India) Private Limited, IIFL Securities Limited, Motilal Oswal Investment Advisors Limited, and YES Securities (India) Limited on the recent sale of approximately INR 14.5 billion (US$200 million) of equity shares in Union Bank of India in a QIP, including a concurrent U.S. private.

Union Bank, incorporated in 1919, is the fourth largest public sector bank in India as at December 31, 2020 in terms of branch network. As at April 30, 2021, Union Bank had more than 120 million customers, which were served by 9,312 branches and 12,789 automated teller machines.

Duane Morris & Selvam’s team was led by Jamie Benson, the head of the firm’s US capital markets and India practices, and also included Hope Krebs, Ken Tan, Jacob Low and Yeo Ming Ze.

L&L Partners acted as Indian counsel to Union Bank and Crawford Bayley & Co. acted as Indian counsel to the book running lead managers.

About Duane Morris & Selvam

Duane Morris & Selvam LLP is the joint law venture between Duane Morris LLP and Selvam LLC, with its headquarters in Singapore. By way of its global platform and extensive range of legal services, the firm helps companies conduct business in and out of Asia, the United States, Latin America, the United Kingdom and beyond. In addition to the excellent skills of its lawyers, clients benefit from the cultural fluency and key relationships that the firm has developed over many years of practising law throughout the region. The firm has a presence in the key markets of Southeast Asia, including Singapore, Hanoi, Ho Chi Minh City as well as offices in Shanghai and Yangon. Supporting these regional offices, the firm operates a series of country desks for India, Indonesia, Korea and Japan, as well as an alliance in Sri Lanka. It is regularly ranked among the region’s leading law firms by Chambers & Partners, The Legal 500 and IFLR1000.

양식 싸움 The Battle of the Forms

무역 금융의 세계는 결코 간단하지 않습니다. 여러 기관, 경쟁 청구, 상계 (set-offs), 임무, 채무와 많은 관계 당사자들이 이루고 있습니다. 이 복잡한 환경을 탐색하는 것은 굉장히 어렵고, 수많은 법적 문제와 불확실성을 야기합니다.

CIMB Bank Bhd v World Fuel Services Singapore Pte Ltd [2021] SGCA 19의 사례에서 이 복잡함이 명백하게 드러납니다. 이 특정 사례에서는 항소법원이 고등법원과 완전히 반대되는 결론에 도달했습니다.  이 사례는 복잡한 다자간 무역금융계약의 어려움(downfall)을 강조하며, 법원의 계약서 해석에 대한 지침을 제공합니다. 법원은 문서의 진위 여부, 진위 입증 방식에 대한 요점을 고려하지만, 이번 기고문은 문제의 핵심인 무역금융 계약의 싸움에 초점을 맞출 것입니다.

Continue reading “양식 싸움 The Battle of the Forms”

The Battle of the Forms

The world of trade finance is never straightforward. Multiple facilities, competing claims, set-offs, assignments, debentures and multiple parties are, to the say the least, what make the backbone of trade finance.  Navigating this complex landscape is tough, and raises a plethora of legal issues and uncertainties.

This complex landscape is evident in the case of CIMB Bank Bhd v World Fuel Services Singapore Pte Ltd [2021] SGCA 19, where the Court of Appeal considered and analysed the same issues of diametrically opposite competing contracts, and arrived at a completely opposite conclusion than that of the High Court.

Continue reading “The Battle of the Forms”

Duane Morris & Selvam acts on Affle’s INR 6 billion (US$82 million) QIP

SINGAPORE, 25 May 2021 – Duane Morris & Selvam LLP acted as international legal counsel to Axis Capital, Nomura and UBS, in their role as the book running lead managers, on the sale of INR 6 billion (US$82 million) of equity shares in Affle (India) Limited in a qualified institutions placement, including concurrent private placements outside India.

Affle is a global technology company with a proprietary consumer intelligence platform that delivers consumer engagement, acquisitions and transactions through mobile advertising, as well as platform aims to enhance returns on marketing investment through contextual mobile ads and also by reducing digital ad fraud.

The Duane Morris & Selvam team was led by Jamie Benson, the head of the firm’s US capital markets and India practices, and also included Zabrina Hamid, Wang Bei, Justin Santarosa, Jacob Low and Yeo Ming Ze.

Induslaw acted as Indian counsel to Affle and J. Sagar Associates acted as Indian counsel to Axis Capital, Nomura and UBS.

About Duane Morris & Selvam

Duane Morris & Selvam LLP is the joint law venture between Duane Morris LLP and Selvam LLC, with its headquarters in Singapore. By way of its global platform and extensive range of legal services, the firm helps companies conduct business in and out of Asia, the United States, Latin America, the United Kingdom and beyond. In addition to the excellent skills of its lawyers, clients benefit from the cultural fluency and key relationships that the firm has developed over many years of practising law throughout the region. The firm has a presence in the key markets of Southeast Asia, including Singapore, Hanoi, Ho Chi Minh City as well as offices in Shanghai and Yangon. Supporting these regional offices, the firm operates a series of country desks for India, Indonesia, Korea and Japan, as well as an alliance in Sri Lanka. It is regularly ranked among the region’s leading law firms by Chambers & Partners, The Legal 500 and IFLR1000.

To Hedge or not to Hedge? That is the (mitigatory) question.

Hedging contracts are well established in the Oil & Gas industry.  It is a common risk management measure used to reduce a party’s exposure to the constantly fluctuating oil prices.  Essentially, under a hedging contract, companies can establish their prices at a fixed price through a commodity swap or option. Hedging contracts are second nature to the industry, and most traders would not give a second thought as to whether such arrangements are reasonable.  However, it was this very issue that was put forth before both the High Court and the Court of Appeal in Apex Energy International Pte Ltd v Wanxiang Resources (Singapore) Pte Ltd [2020] SGHC 138.  The Singapore Courts had to determine whether, following a breach of contract of sale, whether a hedging arrangement was a reasonable mitigation in the quantification of the aggrieved parties losses.  We successfully acted for Apex Energy in proving that a hedging arrangement is a reasonable mitigation measure.

Continue reading “To Hedge or not to Hedge? That is the (mitigatory) question.”

Best Lawyers Singapore 2022 recognizes Duane Morris & Selvam Partners

Singapore, 3 May 2021 – Duane Morris & Selvam is pleased to announce that 5 of our partners have been recognized across 8 practices in the 2022 edition of Best Lawyers. Best Lawyers is a peer review guide to the legal profession and lawyers are nominated by their peers.

Arbitration and Mediation ·         Sarbjit Singh Chopra
Banking and Finance ·         Arfat Selvam
Capital Markets Law ·         Gerard A. Hekker

·         Jamie Benson

·         Krishna Ramachandra

Corporate Law ·         Arfat Selvam
Mergers and Acquisitions Law ·         Arfat Selvam

·         Krishna Ramachandra

Mutual Funds ·         Arfat Selvam
Private Equity Law ·         Krishna Ramachandra
Private Funds ·         Arfat Selvam

About Duane Morris & Selvam

Duane Morris & Selvam LLP is the joint law venture between Duane Morris LLP and Selvam LLC, with its headquarters in Singapore. By way of its global platform and extensive range of legal services, the firm helps companies conduct business in and out of Asia, the United States, Latin America, the United Kingdom and beyond. In addition to the excellent skills of its lawyers, clients benefit from the cultural fluency and key relationships that the firm has developed over many years of practising law throughout the region. The firm has a presence in the key markets of Southeast Asia, including Singapore, Hanoi, Ho Chi Minh City as well as offices in Shanghai and Yangon. Supporting these regional offices, the firm operates a series of country desks for India, Indonesia, Korea and Japan, as well as an alliance in Sri Lanka. It is regularly ranked among the region’s leading law firms by Chambers & Partners, The Legal 500 and IFLR1000.