Overseeing the efficient and cost effective recruitment of high calibre trainees for the London office, and overseeing the pastoral and professional care of current trainees in the firm, ensuring compliance with SRA requirements. In response to feedback from industry groups, the SEC issued a no-action letter in December 2021, which established a tiered set of compliance dates in an effort to allow brokers and dealers time to bring themselves into compliance. Shearman & Sterling. annual reporting or proxy disclosure about directors cybersecurity expertise. These are used in agency-guaranteed securitisation and are described in more detail in 4.13 Participation of Government-Sponsored Entities. As such, the TBA market permits lenders to lock in rates for mortgages before they are originated, which, in turn, allows borrowers access to lower, locked-in rates. The ARRCs approach was not meant to be a binding directive, but merely an example of how an ABS product could be created using average SOFR. Ginnie Mae, Fannie Mae and Freddie Mac are the principal agencies and government-sponsored entities (GSEs) engaged in the securitisation of mortgages. In a securitisation transaction it is common for tax counsel to provide an opinion addressing the tax treatment of the issued securities; in particular, whether the offered notes would be treated as debt securities for US federal income tax purposes. Held here at our London office, the day will comprise of the following: An introduction to the industry and to Shearman & Sterling. In September 2017, the Consumer Financial Protection Bureau (CFPB) filed suit against 15 National Collegiate Student Loan Trusts (the Trusts), alleging that the Trusts had violated the Consumer Financial Protection Act (CFPA) by engaging in unfair and deceptive practices in connection with the servicing and collection of the private education (not Federally guaranteed) student loans owned by each of the Trusts (but not originated nor serviced by any Trust entity). Come qualification time, third-seaters receive a list of teams who are looking to hire for that year. However, asset-level disclosures of the level of detail required in Reg AB II offerings are not commonly included in private placements. Shearman & Sterling advised Abu Dhabi Future Energy Company PJSC (Masdar) and PT PJB Investasi (PJBI), a subsidiary of Indonesian state-owned offtaker PT PLN (Persero), on the $114 million financing of a 145MWac floating solar photovoltaic power project on the Cirata Reservoir in Indonesia. Graduate recruitment manager, Paul Gascoyne tells us the online form is pretty standard and contains three open-ended questions: 'Why do you want to be a solicitor?' This other question of the Trusts vicarious liability for the servicers conduct remains a critical open point and is likely subject to further years of litigation before it is decided or may not be decided at all if the case is settled. In 2014, the Board of Governors of the Federal Reserve System (the Federal Reserve) and the Federal Reserve Bank of New York (the New York Fed) formed the Alternative Reference Rate Committee (ARRC) to identify possible alternative reference rates for US dollar LIBOR and to identify best practices for implementation of a new reference rate. Delaware statutory trusts (DSTs) and Delaware limited liability companies (DLLCs) are often the entities of choice for securitisations. DAVID SCHEFFER, former U.S. The form also gives trainees the option of requesting a secondment. From an investors perspective, if an SPE is treated as a partnership for tax purposes, and the notes issued by the SPE to such investor were to be treated as equity for tax purposes, then the noteholder would be taxed individually on its share of the SPEs income, gain, loss, deductions and credits attributable to the SPEs ownership of the assets and liabilities of the SPE, without regard to whether there were actual distributions of that income. Shearman & Sterling is excellent not only in legal matters but one of their important strengths is in providing strategic advice to clients. They do not go with ready-made solutions but actually listen to client needs and address their services and advice accordingly. These can be provided by third-party liquidity providers or as part of the servicing rights and obligations. Guangzhou Fineland Real Estate Developments Exchange Offer and Concurrent New Money Offering. Among the reasonable determinations that qualify for relief are the following. The calendar year 2023 also should see a continued focus on the transition from the use of the London Interbank Offered Rate (LIBOR) to the Secured Overnight Financing Rate (SOFR). 11 years ago. The required asset-level disclosure must be provided in a standardised format in a tagged XML format and filed on the SECs Electronic Data Gathering, Analysis, and Retrieval (EDGAR) system. All vac schemes run for two weeks and there's room for up to ten candidates on each. According to that section of the Rule 144A adopting release, [i]nstead of the financial statements and other information required about issuers of more traditional structures, the Commission would interpret the information requirement to mandate provision of basic, material information concerning the structure of the securities and distributions thereon, the nature, performance and servicing of the assets supporting the securities, and any credit enhancement mechanism associated with the securities. clarifying that a determining person includes a person with a contingent future right to select a LIBOR replacement; identifying certain specific benchmark replacement conforming changes that are protected; specifying that a determining person may select the Board-selected benchmark, together with any applicable benchmark replacement conforming changes; expressly providing that the statutes protections apply to any LIBOR contract for which the Board-selected benchmark replacement becomes the benchmark replacement, either by operation of law or by the selection of a determining person; and. As a general rule, trainees have to complete two seats within the core departments, which are finance, M&A and project development finance. Shearman & Sterling represented the initial purchasers in connection with Radiance Capital Investments Limiteds offering of $300 million 7.8% senior green notes due 2024. IFC Issues First Housing Bond in Bangladesh. The tasks and the work that you do is always valued. Whats more, the firms client list includes most of the big banks you can name, from J.P. Morgan, Goldman Sachs and Credit Suisse to Barclays and HSBC. The firm was recognized with 106 practice and individual rankings for excellence representing clients across our practices and industries throughout the United States. If there have been no such requests, an annual Form 15-G filing must be made attesting to that fact. Shearman & Sterling has a distinguished history of supporting clients wherever they do business, from major financial centres to growing markets. The ARRC has cast doubt on a broad use of term SOFR in its recommended best practices. The principal laws that govern securities-related disclosures are the Securities Act of 1933, as amended (the Securities Act), and the Securities Exchange Act of 1934, as amended (the Exchange Act). If the CDS counterparty becomes subject to bankruptcy proceedings, the SPE will nevertheless have the right to terminate and close out each swap entered into with that counterparty, and realise against any collateral or other credit support relating to such swap, without being subject to the stay or the prohibition against ipso facto clauses. Shearman & Sterling represented HSBC as the sole dealer manager in connection with an offer to purchase for cash by Jiayuan International Group Limited for its outstanding 13.75% senior notes due 2022 and 13.75% senior notes due 2023. For example, a single-member limited liability company (LLC) is, for federal tax purposes, disregarded (in the absence of the SPE electing any contrary tax treatment) and therefore any transfer of assets from a parent to its wholly owned LLC will not be a taxable event. The agreement will also often contain provisions that define the servicing standard and further address the relevant role and any additional obligations of the servicer. Registered investment companies are subject to leverage and capital structure requirements that are incompatible with a securitisation. Banks that are primarily constrained by the leverage ratio, as compared to the risk-weighted assets (RWA) ratio, will also typically view highly rated, but lower-yielding, senior securities as less attractive investments, whereas insurance companies and banks that are primarily constrained by the RWA requirements may find the highly rated senior tranche highly attractive due to the small amount of regulatory capital required. Reg AB II introduced new ABS-specific registration statement forms, Forms SF-1 and SF-3, to reflect the additional disclosure requirements and shelf-eligibility requirements under Reg AB II. The transaction documents typically include non-petition clauses that restrict involuntary bankruptcy filings against the issuer. Skyfame International Holdings Limiteds $100 million Senior Notes Offering. Its fast-paced, but you are never needlessly busy, a trainee told us. The NAICs letter described a hypothetical example in which an investment in all of the tranches in a CLO transaction would be subject to a lower RBC factor than a direct investment in the CLOs underlying collateral, and they expressed their position that the RBC factor each such investment should be equal. Only JD 2025 law students are eligible to apply. Investors in unfunded ABS tranches will typically have contingent funding obligations and may be required to provide additional credit support or face replacement if their credit drops below agreed levels. Clients regularly entrust us with their most complex and strategic tax matters, resulting in our involvement in ground breaking transactions throughout the world. For subsequent seats however, trainees submit a form with five ranked practice groups, including reasons for each of their choices. This no-action letter withdrew the December 2021 letter, but effectively extended Phase 1 under the December 2021 letter until 4 January 2025. While it was stipulated that the alleged misconduct resulted from actions taken by the Trusts servicers and sub-servicers in the course of their debt collection activities, and not by any actions taken by the Trusts themselves, the CFPB named only the Trusts as defendants in this lawsuit after having previously settled with the servicers involved. On 13 December 2021, the Federal District Court in Delaware denied the Trusts motions to dismiss the complaint on the grounds that the securitisation Trusts meet the definition of covered persons, because even if they themselves do not directly service the loans, they engage in loan servicing through third-party servicers who perform those functions on their behalf. Contributions to SPEs in exchange for a corresponding increase in the value of any equity held in such SPE would typically also be good consideration. If the determining person does not select any non-LIBOR benchmark replacement, the benchmark replacement selected by the Federal Reserve will automatically replace the LIBOR rates in the contract. At a base level, future trainees need a minimum AAB at A level and 2:1 degree. SPEs established as single-member LLCs or Delaware statutory trusts can be readily structured to avoid entity-level tax. 5 Contributions provided by Shearman & Sterling LLP, The general counsel's comprehensive guide | USA. Trainees have shaped our success story and played a pivotal role in the firms growth. The firm has offices across the US, giving it a strong presence in state and federal court actions throughout the country. Our clients rely on our tax planning at every stage of a transaction, from early planning to successful conclusion, and recognize and appreciate our creativity in solving complex tax issues, both local and cross-border. Shearman & Sterling The recommended benchmark replacement will be based on SOFR, including any recommended spread adjustment and benchmark replacement conforming changes. We know that US law firms have a reputation for being aggressive, but that is not the case at Shearman & Sterling. We are one of only a few full-service US law firms in London. Twenty years. That's how long Shearman & Sterling has been welcoming trainees. We're able to offer the opportunity to work in different parts of the world. The movement is in the right direction.. With more than 130 attorneys in the United States, Europe The firm leverages the use of smart technology in all of its client work through its innovative data management system, Shearman Analytics, which provides a leading edge in staffing matters leanly and effectively. The industry has been focused on obtaining permanent relief against those aspects of the new regulations that are particularly burdensome for securitisation SPEs. Job posted 5 hours ago - Shearman and Sterling is hiring now for a Full-Time 2023 Shearman & Sterling 1L Summer Program in Houston, TX. The agencies may also impose civil monetary penalties that can range between USD5,000 and USD1 million per day, and it may seek to impose removal and prohibition orders against any institution-affiliated party (a potentially broad list of persons), which may remove and potentially bar the person from participating in the business of the relevant banking entity or other specified entities. The best practices only recommend the use of term SOFR in these circumstances to date: The ARRC did not recommend term SOFR for most securitizations, stating that as a general principle [it] recommends that market participants use overnight SOFR and SOFR averages given their robustness, particularly in markets where we have seen that there can be successful adoption of these rates such as floating rate notes, consumer products including adjustable-rate mortgages and student loans, and most securitizations. For example, ABS issuers have a finite life, strict limits on their activities and no active governance. On the other hand, if such transfer is treated only as a granting of a security interest in collateral, then a bankruptcy of the seller will subject the buyers rights with respect to such assets to the automatic stay and other bankruptcy powers. daily simple SOFR in arrears, calculated using simple interest over the current interest period; SOFR compounded in arrears, calculated by compounding interest over the current interest period; and. Not surprisingly, the more numerous the secured loan characteristics, the greater the likelihood that the transaction is viewed as such. Advised Ardagh Group on its definitive business combination agreement with Gores Holdings V to create an independent public company. abstain from engaging in certain abusive or anti-competitive conduct. The offering of securities in a synthetic securitisation will be governed by the Securities Act. Masdar Floating Solar Photovoltaic Power Project in Indonesia. Only a small minority of new ABS issuances are made in SEC registered form. Shearman & Sterling represented the initial purchasers in connection with Skyfame International Holdings Limiteds offering of $112 million 13% senior notes due 2023, unconditionally and irrevocably guaranteed by Skyfame Realty (Holdings) Limited. Shearman & Sterling advised IFC on the first housing bond issued in Bangladesh, provided to BRAC Bank Limited. However, the SEC has to date not done so, and the Treasury has recommended against such expansion. Chambers and Partners has been publishing guides to the legal profession since 1990. A security interest in deposit accounts can only be perfected by control. To provide broader relief, Congress passed the Adjustable Interest Rate (LIBOR) Act (the LIBOR Act), which was signed into law in March 2022. In the event that a pre-cessation event is operative, the ARRCs recommended five-year historical median spread adjustments will be determined at the same time as the ISDAs spread adjustments, which will be at the time of any announcement that LIBOR will cease or has ceased or will or has become no longer representative. is a global law firm with approximately 2,200 legal professionals in 31 offices across North America, Europe, Asia and the Middle East. The rights of a purchaser of such assets attach if: Although it is possible for a security interest to attach in some circumstances without a written agreement, it is not practicable to rely on those circumstances always being present in a securitisation transaction. As such, the banking agencies may seek cease-and-desist orders requiring cessation and potential corrective actions. Consequently, a true sale and non-consolidation opinion delivered as part of a securitisation transaction may receive additional comments from accountants relating to assumptions and qualifications that are viewed as potentially problematic under applicable accounting literature. In addition, the Foreign Account Tax Compliance Act (FATCA) imposes a withholding tax on certain payments (including interest in respect of debt instruments issued by a securitisation SPE and gross proceeds from the sale, exchange or other disposition of such debt instruments) made to a foreign entity if the entity fails to satisfy certain disclosure and reporting rules. Shearman & Sterling; watch this thread. Investors in securitisations include banks, asset managers, insurance companies, pension funds, mutual funds, hedge funds and high net worth investors. This structure is typically used in auto lease securitisations and other lease transactions relating to titled goods. 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