New Guidance Documents on Green Loan Principles and Sustainability Linked Loan Principles for a Post-COVID-19 World

Many hope to see an expansion in areas that stimulate growth in a more environmentally friendly manner

By Drew D. Salvest & Natalie A. Stewart

19.05.2020

While the world is currently focused on the impact of COVID-19 on the global economy, with “COVID-19 Bond” issuance easily outdistancing the current volume of green financing, it is time to consider post-COVID-19 activities. One positive effect of the pandemic is the demonstrable improvement of carbon levels and other environmental measures. So, as national governments consider measures to reopen their economies, lenders and borrowers may want to consider how best to finance the economies’ reemergence. Many hope to see an expansion in areas that stimulate growth in a more environmentally friendly manner.

In this context, loan market groups including the Asia Pacific Loan Market Association (APLMA), Loan Market Association (LMA) and Loan Syndications and Trading Association (LSTA) have recently published guidance to market participants on how to apply the Green Loan Principles (GLP) and Sustainability Linked Loan Principles (SLLP) in practice. The aim of the guidance is to develop the market for green financing, following the publishing of the GLP in March 2018 and the SLLP in March 2019.

The key difference between green loans and sustainability linked loans is that green loans place greater significance on the use of proceeds for green projects, whereas sustainability linked loans look to the sustainable nature of the borrower measured against specific targets. Loans can follow both the GLP and SLLP, but are rarely seen in the current market.

Further guidance has been given on the following aspects: Continue reading “New Guidance Documents on Green Loan Principles and Sustainability Linked Loan Principles for a Post-COVID-19 World”

COVID-19: UKGov Holiday Pay and Entitlement Guidance

By Nic Hart

13.05.2020

This UKGov guidance outlines how holiday entitlement and pay operate during the coronavirus pandemic. It is designed to help employers understand their legal obligations, in terms of workers who:

  • continue to work
  • have been placed on furlough as part of the government’s Coronavirus Job Retention Scheme (CJRS)

This guidance should not be treated as legal advice. Employers and workers should always check individual contracts and if necessary seek independent legal advice.

Holiday entitlement

Almost all workers, including zero-hour contracted workers and those on irregular hours contracts, are legally entitled to 5.6 weeks’ paid holiday per year. The exception is those who are genuinely self-employed. Continue reading “COVID-19: UKGov Holiday Pay and Entitlement Guidance”

Staying ‘COVID-19 Secure’: Analysing UKGov’s Back-To-Work Guidance

By Nic Hart

Following on from the Prime Ministers statement on Sunday evening (May 10th), setting out the next phase -Stay Alert- there was a general reaction of uncertainty about how this will translate for employers and employees in practical terms.

In the time since the Prime Ministers statement we have now had a number of Guidance documents released regarding how workers will be kept safe, which is fundamental to implementing a return to work which will have industry and union support. I have given an overview of the new Guidelines and Guidance below, however I am aware that there will be sector specific queries as this Guidance is implemented which I am happy to discuss as required.

The first of the guidance was the Government paper- OUR PLAN TO REBUILD: The UK Government’s COVID-19 recovery strategy, published yesterday -May 11th, which dealt with the work place in general terms. This advised that from Wednesday May 13th and for the “foreseeable future”; Continue reading “Staying ‘COVID-19 Secure’: Analysing UKGov’s Back-To-Work Guidance”

Remobilising UK Construction needs Guarantees, not Guesswork- Part 2

By Steve Nichol and Matthew Friedlander 

Last week we discussed, in light of the encouragement from Robert Jenrick MP (Secretary of State for Housing, Communities and Local Government) for the construction industry to remobilise, the government’s apparent reluctance to provide confidence and clarity for the construction industry in respect of the safe operation of sites.

In the Prime Minister’s address to the nation on 10 May 2020, he re-stated that encouragement for the construction industry, where possible, to return to work. Continue reading “Remobilising UK Construction needs Guarantees, not Guesswork- Part 2”

COVID-19: New Protections For Commercial Tenants – Are Tenants Now ‘Safe’?

By Milan Patel

01.05.2020

The UK Government has recently announced further steps to protect commercial tenants from aggressive rent collection by landlords including a ban the use of statutory demands and winding up orders where a company cannot pay their bills due to COVID-19 and preventing landlords from using commercial rent arrears recovery (CRAR) unless 90 days or more of rent is unpaid.  These measures support the existing ban on landlords evicting commercial tenants.  All of these measures will remain in effect until at least 30 June 2020.

Does that mean commercial tenants can now relax?

Definitely not.  These measures are temporary and do not alter the terms of the lease.   Once they are lifted, landlords will be free to employ such collection methods again and while some landlords have deep pockets, many more do not and almost all will have investors and/or funders to satisfy so it is highly unlikely that unpaid rent will simply be ignored for long once these protection measures end.

So what should commercial tenants be doing now?

Continue reading “COVID-19: New Protections For Commercial Tenants – Are Tenants Now ‘Safe’?”

Employee Refusal To Return To Work in face of COVID-19 ‘Threat To Safety’ – What Is Your Response?

By Nic Hart

01.05.2020

The effects of the Coronavirus pandemic on the workplace continue.  It is undeniable that the potential litigation arising out of COVID-19 will be far reaching and there will be several areas that Employers need to consider now and when the return to work phase commences in earnest.

In a matter of months the Coronavirus pandemic has not only changed the way millions of employees work but also the way they may now view the work place, particularly how safe they feel within their workplace.

Health and Safety claims may become a real issue for employers as employees either leave or propose to leave, refuse to return to work or take (or propose to take) appropriate steps to protect themselves or others from what they believe is serious and imminent danger from infection. Continue reading “Employee Refusal To Return To Work in face of COVID-19 ‘Threat To Safety’ – What Is Your Response?”

COVID-19 Job Retention Scheme – Summary of Updates to UK Gov Guidance

By Nic Hart

30.04.2020

Whilst I am very mindful of furlough fatigue, there have been further updates to the Government Guidance on The Coronavirus Job Retention Scheme – both How to Claim (short form and long form) and the Guidance. None of these have substantively changed but there are points to note in each, which are as follows.

The How to Claim (short form) deals with some of the practicalities of claiming. For those yet to do so please note that you need to submit your claim in one session – you cannot save it and return later. Sessions will time out after 15 minutes of inactivity.

There has been guidance given on what steps to take following a claim;

  1. keep a copy of all records, including:
    • the amount claimed and claim period for each employee
    • the claim reference number for your records
    • your calculations in case HMRC need more information about your claim
  2. tell your employees that you have made a claim and that they do not need to take any more action
  3. pay your employee their wages, if you have not already.

It must be stressed that Employers should record and retain documentation at all stages of the furlough process, both to be compliant with the requirements of the Treasury Direction but also to ensure that if there is any audit undertaken by HMRC they have the requisite records set out in the Guidance. Continue reading “COVID-19 Job Retention Scheme – Summary of Updates to UK Gov Guidance”

MAC Clauses & COVID-19: A Free Pass For Lenders?

By Drew Salvest

28.04.2020

The Scenario:

A client is prudently engaging with its bank to put in place a credit facility to address working capital needs which it anticipates might grow due to the Covid-19 isolation measures causing its customers to reduce requirements for its services and to pay more slowly than during less distressed times. As the motivation for this client to enter into the facility was its potential exposure to the risks to general economic conditions arising from the pandemic, the client was understandably concerned about the lender’s insistence on the inclusion of a “Material Adverse Change” or “MAC” representation and event of default.

The client’s question to us, after vain attempts to remove the language and tepid protestations from its relationship manager that such clauses “are rarely relied upon”, was whether it had any reason to be concerned.

To be fair to the lender, MAC events of default are rarely relied upon to enforce an event of default. However, the Covid-19 pandemic and the government ordered lockdown is having an unprecedented impact on the UK and the global economy. One has to consider whether the changed circumstances arising from this event might have a similarly unprecedented change in the approach lenders take in limiting losses in their loan portfolios. More importantly, if it does, will a typical MAC clause assist them? Continue reading “MAC Clauses & COVID-19: A Free Pass For Lenders?”

Is COVID-19 A Contractual “Get-Out-Of-Jail-Free” Card?

By Sue Laws

28.04.2020

COVID 19 is having a massive impact on supply chains and business continuity and, post lockdown, questions will be asked about who pays for this. The knee-jerk response of many businesses is that the pandemic is a unique, unforeseeable “Act of God” and that businesses which have furloughed staff or been forced to close during the lockdown or have had difficulties with their own supply chains or customers reducing purchase volumes, have no liabilities to or remedies against others for the consequent losses sustained. The reality is that on a case by case basis, businesses already adversely affected by this pandemic may find that contractual claims are being made against them or that they have a route to mitigate their losses by looking at their own contractual or statutory rights.

Key to the analysis which will be carried out is a bit of “jargon-busting” and debunking some commonly held views: Continue reading “Is COVID-19 A Contractual “Get-Out-Of-Jail-Free” Card?”

Is Coronavirus The New Asbestos? Steps For Mitigating Litigation Risk

To mitigate the risk of future mass tort litigation, we look at some practical steps which businesses can take before re-opening their doors

By Sharon Caffrey & Alex Geisler

24.04.2020

This is a hypothetical case study. It’s set in the future, and it’s about a Coronavirus mass tort case. Our trial opens like this:

“Ladies and gentlemen of the jury, I represent the family of Mr Smith. The facts of the case are that he died of Covid-19, and that he was in three commercial locations during the infection window. 1) He went to work 2) He stayed at a hotel 3) He shopped in a store, and these are our three Defendants. Mr Smith travelled alone in his car to these locations, and no-one else in his family was sick before he broke home isolation to go to these places. All three of these Defendants reopened for business to make money, and one of them is where Mr Smith was exposed to the deadly virus. These are the facts of the case, and they are not in dispute.”

Aside from borrowing the cadence from Aaron Sorkin[1], does this sound far-fetched? Well, consider this. Businesses will reopen and people will leave the relative safety of home isolation. Some will get sick, and tragically some will die. The question is not whether there will be litigation, it is what will the ground rules be? So, imagine that you’re a Defendant on this imaginary docket, and ask yourself this, what are my possible defences?

Continue reading “Is Coronavirus The New Asbestos? Steps For Mitigating Litigation Risk”

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The opinions expressed on this blog are those of the author and are not to be construed as legal advice.

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