Travers Smith

This Practice Note gives an introduction to repo (repurchase transactions) and the Global Master Repurchase Agreement (GMRA), the most commonly used agreement in the UK and EU repo markets. It looks at (1) why parties use repo, (2) payment and delivery obligations, (3) key legal issues which arise with repos, (4) the difference between repo and securities lending, (5) the general structure of the market documentation, (6) benefits of using the GMRA, (7) key provisions under the GMRA, (8) clearing and automatic trading, (9) repo and the Financial Collateral Arrangements (No.2) Regulations 2003, and (10) in brief, the Securities Financing Transactions Regulation.

This Practice Note gives an introduction to securities lending transactions and the Global Master Securities Lending Agreement (GMSLA), one of the most commonly used agreements in the UK and EU securities lending markets. It covers (1) why parties enter into securities lending transactions, (2) payment and delivery obligations, (3) key legal issues which arise in a securities lending transaction, (4) the difference between securities lending and repo, (5) the general structure of the market documentation, (6) benefits of using the GMSLA, (7) key obligations under the GMSLA, (8) central clearing, (9) the pledge structure (security interest) GMSLA, (10) securities lending and the Financial Collateral Arrangements (No.2) Regulations 2003 (FCAR), and (11) the Securities Financing Transactions Regulation (SFTR).

This Practice Note provides a summary of the main issues that arise on a corporate transaction in relation to the company which has granted Enterprise management incentive (EMI) options. It addresses the need to consider whether there are any issues that could prevent the options from qualifying as EMI options or that could have given rise to disqualifying events, and the factors to be borne in mind when reviewing the EMI documentation. It also covers potential valuation issues that may arise, the identity and status of EMI option holders and the potential use of discretion in respect of options. Finally this Practice Note sets out considerations relating to the possible use of cashless exercise with EMI options and issues that may arise in transactions when the buyer is located in the US. This Practice Note is produced in partnership with Claire Prentice and Natalie Paddock of Travers Smith.

This Practice Note explains how the income-based carried interest (IBCI) rules attempt to ensure that only carried interest returns that arise from long-term investment activity can benefit from capital gains tax treatment. It also looks at how the IBCI rules interact with the disguised investment management fee (DIMF) anti-avoidance rules. This Practice Note explains how the average holding period of a fund’s relevant investments is calculated and sets out the special rules applicable to funds with controlling interests, funds of certain types (eg venture capital funds, significant equity stake funds, funds of funds), and the treatment of direct lending funds. It also covers the exemption for carried interest which is conditionally exempt. This Practice Note was produced in partnership with Emily Clark of Travers Smith.

This Practice Note is an introductory guide for tax lawyers on how a typical UK (‘onshore’) private equity fund is structured. It explains what a private equity fund is and who the typical investors are (mainly institutional investors seeking long-term capital growth), illustrates how a typical fund is structured, and explains the role of each of the entities in the structure. It also sets out common terms that are agreed with investors and the key documents required to set up the fund. This Practice Note was produced in partnership with Emily Clark of Travers Smith.

This Practice Note focuses on the requirements imposed on pension schemes with effect from 1 October 2021 to reflect the climate change (ESG) recommendations of the Task Force on Climate-related Financial Disclosures (TCFD). It also contains a TCFD timeline.