TQR: Trustee minutes – should they take hours?

A consideration of what content trustees' minutes should contain in light of trustees' duties and disclosure and cost issue

Ashley Fife TEP, Head of Legal at Equity Trust (Jersey) Ltd,  has contributed a timely article to Trust Quarterly Review (TQR) on what trustees should, and should not, record in minutes of their decisions.

What information should trustees’ minutes contain?

Trustees’ minutes should, as succinctly as possible demonstrate that the trustees have exercised their discretions in a responsible manner by:

• including a summary of material elements of the transactions contemplated, sufficient to demonstrate that the trustees understand those transactions
• identifying the relevant background facts, documents and context in which the transactions are being considered
• attaching the documents that the trustees would need to execute to give effect to the transactions being considered
• considering the discretions that are available to the trustees under the trust instrument that permit them to enter into the contemplated transactions
• attaching key documents relevant to the trustees’ decisions, particularly if the documents are of a more discrete nature (for example, a file note of a telephone discussion or an email). Alternatively, rather than attaching those documents, the trustees may simply identify the documents. This may be practical where the documents considered are voluminous, or easily accessed or identifiable (for example trust instruments, recent financial statements, relevant previous contracts), and
• observations setting out why the trustees consider that their entry into the transactions is appropriate in the circumstances, in light of the interests of the beneficiaries as a whole and including how the transactions will likely provide benefit to one or more beneficiaries of the trust.

TQR Vol 9 Issue 2 May 2011 pp.18-24

Investment Treaty Arbitration and Developing Countries: A Re-Appraisal

There is an ongoing debate about bilateral investment treaties (BITs) – and investor-state arbitration, in particular – between those who maintain that BITs encourage investment in developing countries by providing enforceable rights and protections for investors, and those who suspect that these new rights and protections have a chilling effect on regulation for public and environmental welfare and actually hinder development. For years, both "camps" have drawn heavily upon anecdotal evidence and observations to support their view, as no systematic, comprehensive study of empirical data on investment arbitrations had been undertaken. To fill this void, legal scholar Susan Franck has evaluated the criticisms of investment arbitration based on empirical studies of published or known disputes (Franck 2009; Franck 2007). These efforts produced helpful data and initiated a productive discussion of these issues. However, the results and conclusions that can be drawn from Franck’s work are more limited and warrant more nuance than Franck and others so far have taken into account. Franck’s work is now widely used to support the notion that developing countries do not disproportionately "lose" under the investment arbitration regime. Such a conclusion does not appear to be supported by Franck’s data. This article analyzes Franck’s work to show where differing conclusions emerge. We show that: 1) there is a lack of adequate sample composition and size to conduct rigorous empirical work from which an analyst could draw such bold lessons; 2) discounting the fact that developing countries are subject to a disproportionate number of claims is not to be overlooked, especially when looking at claims by the United States; and 3) relative to government budgets and in per capita terms developing countries pay significantly more in damages than developed nations do.

Kevin P. Gallagher and Elen Shrestha

Tufts University

Medford MA 02155, USA

Working Paper No. 11-01: Investment Treaty Arbitration and Developing Countries: A Re-Appraisal

Mauritius: National ICT Strategic Plan 2011- 2014 to be Released Soon

Stakeholders of The National ICT Strategic Plan (NICTSP) 2011 – 2014, which focuses on the development of a comprehensive broadband policy for Mauritius with a view to making cost of, and access to, telecommunications services one of the most affordable in the world, will be made public soon.

The announcement was made by the Minister of Information and Communication Technology, Mr T. Pillay Chedumbrum, this morning at the opening plenary of the SWIFT African Regional Conference - Africa 2011 held at the Intercontinental Hotel, Balaclava. According to the Minister, the recommendations in the NICTSP would benefit those sectors relying heavily on ICT services, in particular the banking and financial sectors.

SWIFT is the global provider of secure financial message services in business operations. The three-day Conference aims at enabling the 325 delegates from 44 countries to express their views on issues that are highly relevant to the SWIFT Community in Africa, to discuss the key trends and challenges of the financial world and take stock of SWIFT products and services. The Conference theme is ‘Fostering Africa’s growth in the New Reality – From vision to action’.

In his opening remarks, the Minister of Information and Communication Technology highlighted Government’s utmost commitment to ensure the country’s preparedness to the ever-increasing cyber security threats that may jeopardise safe and secure electronic transactions.

As part of initiatives taken by the Government on that score, Mr Pillay Chedumbrum stated that his ministry is in the process of finalising a comprehensive Critical Information Infrastructure Protection Framework, an invaluable instrument for the protection of critical infrastructure, including in the banking and financial sectors. The Framework, which has already been validated by the International Telecommunication Union, is based on the adoption of internationally recognised information security management systems, such as ISO 27001, the reporting of cyber security incidents and the undertaking of third party audits on Critical Information Infrastructure.

Furthermore, the Minister said that a marketing strategy would be elaborated to encourage stakeholders, including those of the financial services sector, to adopt the Mauritius Public Key Infrastructure as a trusted and secure e-commerce platform. The measure would contribute to establish Mauritius as a trusted hub for e-commerce by providing a wide range of security and services.

For his part, the Governor of the Bank of Mauritius, Mr R. Bheenick, recalled the contribution of SWIFT in establishing safe and secure inter bank transfers. He also highlighted the efforts of the Bank of Mauritius in making the payment and settlement systems more resilient through the use of state-of-the-art infrastructure in line with international best practices.

UK’s Islamic Finance capability assured as UKIFS is integrated into TheCityUK

We are proud to announce that the UK Islamic Finance Secretariat (UKIFS) has today been integrated into TheCityUK. Launched in March 2010, the UKIFS is the leading cross-sectoral body assisting with the promotion and development of Islamic Finance, both domestically and to represent the UK industry internationally.

Under our structure, efforts will focus on safeguarding and further developing the UK's strengths in Islamic Finance, ensuring it not only remains the West's hub for this financial specialism but continues to be a significant contributor on a global stage. This latest step will see the UKIFS' working group structures and member base integrated into our operations with members of our Board and Executive appointed to the Board of UKIFS. Richard Thomas, CEO of Gatehouse Bank is appointed Chair of the Working Groups and in conjunction with our executive, will support the development and growth of the UKIFS within the UK and its position as a global hub for Islamic Finance.

This market development comes at a time of strong growth in Islamic finance across the spectrum of financial and related professional services. There are currently 22 banks in the UK offering Islamic finance products, exceeding that of any other Western country. There were 5 sukuk listings at the London Stock Exchange in 2010 and one in early 2011, bringing the aggregate total at the LSE to 31 listings worth $18bn. Islamic funds managed in the UK have combined assets of $300m. The global Islamic finance market grew by 10% in 2009 to $1,041bn and our Islamic Finance Report estimates that the global market for Islamic finance grew at a similar rate in 2010.

Chris Cummings comments, "TheCityUK is looking forward to playing a key role in ensuring the UK's ongoing success as the leading Western provider of Islamic Finance. The integration of UKIFS into TheCityUK is a landmark development which will provide fresh opportunity to promote the Islamic Finance capability, building on the work undertaken by UKIFS' founding directors and by the Chartered Institute for Securities & Investment (CISI). This latest development will ensure the UK's capability in Islamic Finance can continue to evolve and we encourage firms to support this important initiative."

Endorsing the acquisition, Lord Green, UK Minister of State for Trade and Investment said: "As the undisputed leading Western hub for Islamic finance services, the UK has recognised the role of the sector in contributing to future economic growth. UKIFS has achieved a great deal in representing the industry since it was launched in 2010. I am pleased that it is becoming part of TheCityUK, in a move that will strengthen the promotion of the wider UK offer overseas. I wish TheCityUK and UKIFS every success for the future, and UKTI looks forward to supporting this exciting market development both at home and abroad."

Global recovery firmly underway but surrounded by risks, says OECD Economic Outlook

The global recovery is firmly under way, but is taking place at different speeds across countries and regions, according to the OECD’s latest Economic Outlook.

Historically high unemployment remains among the most pressing legacies of the crisis. It should prompt countries to improve labour market policies that boost job creation and prevent today’s high joblessness from becoming permanent, the report said.

World gross domestic product (GDP) is projected to increase by 4.2% this year and by 4.6% in 2012. Across OECD countries GDP is projected to rise by 2.3% this year and by 2.8% in 2012, in line with the previous forecasts of November 2010.

In the US, activity is projected to rise by 2.6% this year and by a further 3.1% in 2012. Euro area growth is forecast at 2% this year and next, while in Japan, GDP is expected to contract by 0.9% in 2011 and expand by 2.2% in 2012. The recovery is becoming self-sustained, with trade and investment gradually replacing fiscal and monetary stimulus as the prinicipal drivers of economic growth. Confidence is increasing, which could add further buoyancy to private sector activity, the OECD said. But there are downside risks, including the possibility of further increases in oil and commodity prices, which could feed into core inflation; a stronger-than-projected slowdown in China; the unsettled fiscal situation in the United States and Japan; and renewed weakness in housing markets in many OECD countries. Financial vulnerabilities remain in the euro area, in spite of strong adjustment efforts underway in some countries.

OECD Chief economist Pier Carlo Padoan talks about the Economic Outlook

“This is a delicate moment for the global economy, and the crisis is not over until our economies are creating enough jobs again,” said OECD Secretary-General Angel Gurría. “There is also some concern that if downside risks reinforce each other, their cumulative impact could weaken the recovery significantly, possibly triggering stagflation in some advanced economies.”

The top challenge facing countries continues to be dealing with widespread unemployment, which affects more than 50 million people in the OECD area. Governments must ensure that employment services and training programmes actually match the unemployed to jobs. They should also rebalance employment protection towards temporary workers; consider reducing taxes on labour via targeted subsidies for low paid jobs; and promote work-sharing arrangements that can minimise employment losses during downturns.

Stronger competition in retail trade and professional service sectors could also lead to greater job creation, and should be considered as part of wider structural reform programmes in advanced and emerging economies alike, the OECD says.

In advanced economies structural reforms can play a greater in role in boosting growth as governments are forced to withdraw fiscal and monetary stimulus launched in reaction to the crisis.

In emerging-market economies, structural reforms have the potential for making growth more sustainable and inclusive, while contributing to global rebalancing and enhancing long-term capital flows, the OECD said.

Emerging economies must also pay particular attention to the danger of overheating, which is increasing inflationary pressures, and in some cases, widening current account imbalances.

Countries must also make progress toward their fiscal consolidation goals, which are increasingly urgent. Government debt is set to rise to close to 96% of GDP average in the euro area this year and to just above 100% of GDP in the OECD as a whole. This is about 30 percentage points above the pre-crisis level. “High public debt levels, which have been shown to have a negative impact on growth, must be stabilised and then reduced as soon as possible, especially if one considers the likely impact of ageing in the next few decades,” Mr Gurría said.

Source: OECD Economic Outlook 89 database

For more information on OECD Economic Outlook 89, visit: www.oecd.org/oecdeconomicoutlook

Transparency International calls on OECD leaders to reinvigorate fight against corruption

A new report from Transparency International (TI), the anti-corruption organisation, shows no improvement in the enforcement of the OECD Anti-Bribery Convention in the past year and warns that this could signal a dangerous loss of momentum in the fight against corruption.

Huguette Labelle, Chair of TI, calls on top government leaders attending the OECD Ministerial on 25-26 May to take action to pressure lagging member states to reinvigorate enforcement of OECD’s landmark Convention.

The TI Progress Report on Enforcement of the OECD Convention, covering 37 countries, shows that there are still only seven countries with active enforcement, nine with moderate enforcement, and 21 with little or no enforcement.

This is the first time in the seven years TI has been reporting on the OECD anti-bribery Convention that no progress has been made in the number of countries enforcing the Convention’s prohibition against foreign bribery.

TI’s findings are consistent with the OECD’s own review, which reported that only five parties to the Convention sanctioned individuals or companies in the past year.

“Only where there is active enforcement is there sufficient deterrence against foreign bribery,” said Labelle. “The collective commitment to stamp out foreign bribery made by all OECD parties is undermined when a large number of countries have inadequate enforcement. Without consistent enforcement one of the success stories of the OECD’s past decade will start to unravel. Failure to enforce the Convention will allow corruption to flourish, which means that resources will be diverted from the poor and that honest companies will lose out.”

Adequate enforcement requires renewed political commitment by government leaders in the lagging countries. Where political will is lacking, OECD’s country reviews have not been enough to achieve active enforcement. Pressure must be exerted at the highest political level.

TI recommends that the leaders meeting this week in Paris for the OECD’s 50th Anniversary Ministerial commit to reinvigorate the fight against foreign bribery by adopting a twelve-month programme consisting of the following steps:

• Governments with lagging enforcement should promptly prepare plans for strengthening enforcement and a timetable for such action.
• The Secretary-General and the Chairman of the Working Group on Bribery should meet with top leaders of governments with lagging enforcement to review plans and timetable for strengthening enforcement.
• A full review of the status of foreign bribery enforcement should take place at the May 2012 Ministerial.
• The Working Group on Bribery should publish a list of governments with lagging enforcement. This would make clear that a higher level of due diligence is needed to do business with companies based in these countries.

Key Results

Category	Percentage of world trade	Countries
Active Enforcement (7)	30%	Denmark, Germany, Italy, Norway, Switzerland, United Kigdom, United States
Moderate Enforcement (9)	20%	Argentina, Belgium, Finland, France, Japan, Korea (South), Netherlands, Spain, Sweden
Little or No Enforcement (21)	15%	Australia, Austria, Brazil, Bulgaria, Canada, Chile, Czech Republic, Estonia, Greece, Hungary, Ireland, Israel, Luxembourg, Mexico, New Zealand, Poland, Portugal, Slovak Republic, Slovenia, South Africa, Turkey

Scale of bribery problem remains enormous

Bribery can add up to 25 per cent to total costs in government procurement, according to TI. The World Bank says that the cost of corruption is US$1 trillion a year, and that corrupt money associated with bribes received by public officials in developing and transition countries is between US $20 billion and US $40 billion per year. The enormous scale of bribery makes clear why high-level government action to strengthen enforcement is necessary.

The report also showcases Nigeria because of the large number of cases and investigations in multiple jurisdictions involving foreign bribery allegations in that country. The resulting settlements have involved more than US$ 1.7 billion in fines and disgorgement.

TheCityUK launches report on EU financial reform

Today we launch a new report, produced in conjunction with leading economic consultancy Oxford Economics and the International Regulatory Strategy Group (IRSG), entitled Balancing growth and stability in EU financial reform. The report identifies the need for financial reform that ensures systemic stability but also allows well-managed risk-taking in the pursuit of economic growth.

The report, launched at our event for policymakers in Brussels, comes at a key moment as governments and regulators continue to reappraise the global regulatory architecture in the wake of the banking crisis. It highlights that while new regulatory measures such as an effective resolution regime are required to restore confidence in the financial system, it is essential that policymakers take account of the costs of new regulatory measures, not only on the financial services sector, but across the wider EU economy.

Chris Cummings comments: "Given the large and visible costs of financial instability for society as a whole, it is right for policymakers to make the avoidance of financial crises a high priority. But it is also important to recognise that regulation carries a range of impacts that can dilute the benefits to consumers and the wider economy from a vibrant financial services sector.

"The industry is a driver of growth. It helped European companies raise €126bn last year for business investment. It employs nearing 10m people throughout Europe, nearly 5% of the total EU workforce contributing 6% of the Union's economic output. Our report provides a framework to inform the policy debate on financial regulation in Europe, and by extension the future of Europe's financial system and its entire economy. TheCityUK and its members look forward to engaging with policymakers in the EU and its member states to create the conditions in which Europe's savers, companies and taxpayers regain full confidence in the stability of the financial system."

Nadia Calviño, Deputy Director-General in DG Internal Market and Services at the European Commission responded to the report: "The Commission welcomes this report as a timely contribution to the regulatory debate. I agree with the report that regulation should be carefully calibrated to ensure that it has a positive cost/benefit analysis and does not unjustifiably impact on growth. We follow this principle in our legislative drafting, with detailed impact assessments. We also believe that international coordination on regulatory reform is key and that the G20 is the right forum for this. We look to our key international partners to fully implement G20 commitments."

Mr Jens Tholstrup, Managing Director of Oxford Economics further comments: "Our report clearly demonstrates why the future regulatory regime should strike a balance: regulating for greater stability should not prevent the financial system from providing capital and risk management to companies and citizens across the EU economy, in order to support sustainable economic growth."

Singapore and Italy Enhance Tax Cooperation

Singapore and Italy signed an Additional Protocol to incorporate the internationally agreed Standard for the exchange of information for tax purposes, upon request, in their standing Agreement for the Avoidance of Double Taxation (DTA), among other provisions.

The protocol was signed in Singapore between Singapore’s Permanent Secretary (Finance)(Performance), Ms Chan Lai Fung, and the Ambassador of Italy to Singapore, Dr Anacleto Felicani.

The full text of the protocol is available here. The Protocol will enter into force after its ratification by both countries.

Mauritius: Financial Services Review Panel determination re Anderson Ross Consulting Limited v/s FSC

The Financial Services Review Panel has filed its determination in the matter of Anderson Ross Consulting Limited v/s The Financial Services Commission on 24^th May 2011. The application for review of the decision of the Enforcement Committee in this matter has been set aside.

The full text of the determination can be consulted by following the link below:

Determination of the Financial Services Review Panel

Internationalising the SEM & positioning Mauritius as an IFSC of substance

The Stock Exchange of Mauritius Ltd (SEM), in line with the vision of internationalizing its reach and positioning Mauritius as an international financial services centre of substance, has revamped its existing Official Market Listing Rules by introducing a new Chapter, namely Chapter 18, which caters for the listing of specialist companies and specialist debt instruments.

The decision to revisit the Listing Rules emanates from discussions that the SEM has had in the recent past with the Financial Services Commission, the Board of Investment and operators in the Global Business Sector, which underscored the importance and need of attracting the listing of Global Business Companies and other specialist instruments on the SEM. Consequently, the SEM has introduced a new Chapter 18 in its Listing Rules which has been specifically designed to meet the listing requirements of Global Business corporations and specialist debt instruments targeted at qualified investors.

The SEM believes that the implementation of Chapter 18 of the Listing Rules will create an enabling and competitive environment for the listing of Global Business corporations and of specialist debt instruments on the SEM, strengthening thus the image of Mauritius as an international financial services centre of substance which offers a complete gamut of services to Global Business companies/international issuers ranging from incorporation, front and back-office services to listing on a well recognised Stock Exchange.

The implementation of Chapter 18 also fits very well with recent initiatives undertaken by the SEM to scale up its activities, internationalise the Exchange and move up in the value-chain of products that it offers. The recent recognition of SEM by the U.K Her Majesty’s Revenue and Customs and the ability of the SEM to list, trade and settle products in USD, Euro and GBP open up new avenues of growth for our markets. The implementation of Chapter 18 now provides the necessary regulatory framework to fully capitalise on these new avenues of growth and help the SEM emerge as a multi-product international Exchange.

This note describes the rationale and specificities of the new Chapter 18 and the opportunities available to Global Business companies and issuers of specialist debt instruments to use the SEM platform as a listing venue of choice for the listing of their equity securities as well as for their debt instruments targeted to qualified investors. It also underscores the many potential advantages that Global Business companies and issuers of specialist debt instruments can derive from a listing on the SEM.

CHAPTER 18: RATIONALE, SPECIFICITIES AND KEY REQUIREMENTS

Mauritius has been very successful during the last two decades in its drive to diversify its economic structure and grow the financial services sector as an important pillar of the economy and a key contributor to the country’s GDP. A flexible and yet rigorous regulatory framework, a number of favourable double-taxation treaties, a competitive taxation regime, economic reforms coupled with political and social stability are some of the key factors that have over the years enabled Mauritius to have its footprint as one of the leading emerging financial centres in this region of the world.

A number of new initiatives are currently being considered by the authorities and private sector players to scale up the activities and contribution of the financial services sector to the Mauritian economy, position Mauritius as a prominent gateway linking Europe/USA/Asia to Africa and Europe/USA to Asia and increase the scope and substance of activities conducted in the financial services sector. In a nutshell, the objective is to enable our financial services sector to offer users a whole range of services spanning across a wide spectrum of related activities.

The SEM is of the view that it can concretely bring its contribution to this initiative by positioning itself as a listing venue of choice for global business companies and issuers of specialist debt instruments which consider a listing on the SEM as an excellent means to raise their profile vis-à-vis their investors, open up their companies/products to investors that can only invest in listed companies/products, raise capital to expand their activities, obtain an objective market price for their companies/products and demonstrate substance in their activities in Mauritius.

Some of these companies may already meet the current entry requirements of the Official Market and already have on their register a large number of shareholders, whereas others may only have a limited number of shareholders and a relatively concentrated ownership structure, but are yet good companies with a good current and future business potential and willing to use the SEM platform to either improve their international business profile, attract new investors to their register and/or use the Exchange platform as a means to raise capital for future expansion. Chapter 18 caters essentially for the latter type of issuers, namely Global Business corporations which do not yet meet the general entry requirements of the Official Market and issuers of specialist debt instruments that are targeted to qualified investors.

Although the general entry requirements applicable to entities seeking a listing on the SEM have been reviewed for Global Business companies and issuers of specialist debt instruments, the continuing listing obligations in terms of reporting frequency, thoroughness and transparency have been maintained to ensure that investors and the market are fully kept informed of the evolution and performances of the underlying listed products.

KEY REQUIREMENTS TO LIST AS PER CHAPTER 18

In terms of key entry requirements, Chapter 18 has introduced the following key flexibility:

• Listing of corporations holding a Category 1 Global Business Licence:

(i) A corporation holding a Category 1 Global Business Licence can seek a listing on the Official Market of the SEM even if it does not have a threeyear track record. However, the applicant should demonstrate satisfactory experience in the management of the business and its sustained viability through a solid business plan.

(ii) The applicant must have a market capitalisation of MUR 20 million to list on the Official Market.

(iii) The applicant needs not have a minimum number of 200 shareholders and a percentage of 25% of the issued share capital in the hands of the public at time of application for a listing.

(iv) Before granting a listing, the SEM should be satisfied that the issuer and its business are suitable to allow the listing of its securities.

• Listing of specialist debt instruments

Specialist debt instruments are debt instruments that are targeted to qualified investors. Qualified investors are special categories of investors acceptable to the SEM who are knowledgeable and understand the risks of investing in such specialist debt instruments and include but are not limited to expert investors as defined in the Securities (Collective Investment Schemes and Closed-end Funds) Regulations 2008.

(i) The issuer of the specialist debt instrument needs not have a three-year track record in order to be able to list the specialist debt instrument on the Official Market.

(ii) The nominal amount of each class of debt securities for which listing is sought must normally be not less than MRU 25 million but the SEM may admit securities of lower value subject to the fulfillment of certain specific conditions, namely: if it is satisfied that there will be an adequate market for the securities concerned or where listing is sought in respect of a further issue of debt securities which are or are to be uniform in all respects with debt securities of a class already listed.

(iii) The condition that the securities must be in the hands of not less than 100 members of the public as normally required to list debt securities on the Official Market does not apply to issuers of specialist debt instruments seeking a listing under the new Chapter 18 of the Listing Rules.

Advantages of a SEM listing to specialist companies & debt instruments

Why should a specialist entity or an issuer of specialist debt instrument list on the SEM?

Choosing the SEM as a listing platform has numerous benefits resulting from a combination of factors which can be summarized as follows:

• The SEM is a well-regulated Exchange which has gained recognition through its accreditation to various international bodies, including the World Federation of Exchanges (WFE), South Asian Federation of Exchanges (SAFE), African Securities Exchanges Association (ASEA) and Committee of SADC Stock Exchanges (COSSE). Most recently, the SEM has been designated as a Recognised Stock Exchange by the U.K. Her Majesty’s Revenue & Customs.

• Companies listed on the SEM are subject to rigorous regulation and monitoring and abide by rules continuously revised in line with international standards of best practice. New Chapter 18 ensures flexibility of listing with rules adapted to company-specific circumstances and objectives of specialist structures including Global Business corporations and specialist debt instruments.

• Screen-based trading is provided for domestic and international companies, including specialist companies and debt instruments. Further, the ability of the SEM - the only Bourse in Africa - to list, trade and settle products in USD, Euro and GBP opens up new avenues of growth for our markets. Clearing and settlement of transactions is performed in strict compliance with the G30 and CPSS/IOCO standards by the Central Depository & settlement Co. Ltd (a subsidiary of the SEM). The new Chapter 18 provides the necessary regulatory framework to fully capitalise on these new avenues of growth.

• A simple and competitive fee structure providing affordable entry and continued listing is available to prospective and listed entities (refer to Appendix 7 of the Listing Rules).

• The SEM is committed to a speedy processing of applications with a turnaround time of 2 weeks once the final application is complete.

• There is no requirement for the applicant to have registered sponsors as in other jurisdictions, which implies relatively substantial cost savings. Financial advisers/legal experts may hence handle applications and deal with the SEM.

• The Exchange platform offers a unique opportunity for these types of entities to raise capital for future funding with a view to accompanying their growth initiatives and also for the trading of their securities in a secure and transparent environment.

• A listing on the SEM will add to the attractiveness of the company from an investor’s perspective, whilst representing an important way of demonstrating substance and added value. It can be particularly important where an investment entity is marketed to institutional investors, whose own rules may prohibit or restrict investment in unlisted securities.

• A listing on the SEM constitutes a means of demonstrating substance in the Mauritian jurisdiction and can be particularly advantageous to foreign investors who channel their investments through Global Business corporations incorporated in Mauritius and who may benefit from tax advantages stemming from double taxation treaties between Mauritius and a number of foreign jurisdictions.

• The geographical position of Mauritius and the numerous double taxation treaties that Mauritius has with a number of fast growing African countries makes it the ideal place to structure and list special purpose vehicles for investing in African markets.

SEM Chief Executive Presentation " Internationalising the SEM and positioning Mauritius as an international financial services of substance"

Improving Corporate Governance in the Financial Services Industry - A Regulator's View

Address at the Mauritius Institute of Directors' Breakfast Forum By Rundheersing Bheenick, Governor, Bank of Mauritius, Ebène, Mauritius, 22 March, 2011

Irish Funds Industry to Create More Than 700 Jobs by Year End

Some 711 Jobs are to be created in the Irish funds industry by the year end, it was announced this morning (Friday, May 20) at the AGM of the Irish Funds Industry Association (IFIA).

It was also revealed that the industry saw a 5 per cent increase in employment during 2010 creating 432 new jobs, according to a HR survey of the IFIA’s member firms.

This means that in the two year period from the start of 2010 to the end of 2011 the Irish funds industry will have created 1143 new jobs in Ireland – bringing total employment to 12,500.

In fact, the industry looks set to create even more jobs than expected as it was recently revealed that IFIA member company Deutsche Bank is to move its entire European hedge fund administration operation to Dublin and create a European centre of excellence for hedge funds in the IFSC recruiting between 75-100 people by the end of the year.

This news follows a recent announcement that Apex was to create 50 new positions in Dublin.

Both Deutsche Bank’s and Apex’s new jobs are in addition to the more than 700 revealed in the survey.

The jobs created by the funds industry encompass a variety of positions from fund accountants/administrators; transfer agency, custody and trustee; client relationship manager; legal, accounting and tax advisory roles. The remainder of jobs embrace a large number of roles from compliance to IT and HR to business support.

The survey results were announced by Ken Owens, Asset Management Partner at PWC, as he officially took up the role of Chairperson of the association. He takes over from Carin Bryans, MD of JP Morgan in Ireland.

He pointed out that in 2010 the industry reached all time highs with funds under administration of €1.87 trillion – a 34% year on year increase, up from €1.4 trillion at the end of 2009.

Mr Owens said: “Despite the economic crisis, funds have proved extremely resilient with improved returns and asset values. It is reassuring that we are now seeing an increase in the level of fund activity in Ireland, particularly with the increased interest in EU domiciled products.

“And with the level of assets rising and new funds being authorised, we have seen the demand for funds servicing show a healthy increase over the last year, with major funds servicing companies expanding their activities in both Dublin and throughout the country.”

Gary Palmer, Chief Executive of the IFIA, highlighted that the growth the industry in Ireland recorded during 2010 was considerably greater than any other comparable fund jurisdiction and noted that this achievement “underlines the experience, expertise and global reach of Ireland as a leading funds domicile and the world’s number one centre for the administration of investment funds.”

He added: “And we expect this growth to continue.”

Demonstrating the significance of the industry in contributing to the economy an Taoiseach Enda Kenny has confirmed he will address the IFIA’s Global Annual Investment Conference in Dublin on June 2. This is the first time the new Taoiseach will speak directly to a financial audience of this kind since his election.

Listing of an 11th Global Fund on the Stock Exchange of Mauritius (SEM)

The Listing Executive Committee of the Stock Exchange of Mauritius Ltd (SEM) approved today, Friday 20 May 2011, the listing of yet another global fund on the Official Market of the Exchange. After the listing of JPT Capital PCC, back in December 2010, the SEM is now admitting its 11th global fund, namely Focus Cell 1 of Fidelis Opportunity Fund PCC. More applications for the listing of global funds on the SEM are in the pipeline.

The listing of Global Funds is in line with SEM’s strategy to position itself as a multi-product and internationally oriented Exchange. In early 2010, SEM achieved an important step by reviewing its listing rules and rendering them flexible and adaptable to the specificities of a wide variety of funds, including Professional Collective investment schemes, Specialised collective investment schemes, Expert Funds, and other types of Global and Specialised Funds.

During 2010 and 2011, SEM’s focus has been on an aggressive marketing of this competitive framework both locally and internationally, and bridge regulatory gaps with a view to enhancing the competitiveness of the Exchange as a listing venue for funds. SEM’s recent designation by the United Kingdom’s Her Majesty’s Revenue and Customs (HMRC) and its approved status by the Cayman Islands Monetary Authority (CIMA), have further added to the Exchange’s attractiveness as a listing venue for global funds.

Facts on Fidelis Opportunity Fund PCC

Fidelis is a protected cell company incorporated on August 06, 2010 with a Category 1 Global Business License and governed by the Companies Act and the PCC Act. A listing on the SEM will enable Fidelis to enhance its visibility and its reach to international investors. Fidelis intends to list one cell presently, namely Focus Cell 1, whose investment objective is to seek superior, risk adjusted returns, by investing in a portfolio of International Property, Fixed Interest instruments, Offshore Fixed-Rate and Convertible Bonds issued by Indian entities.

Committee Reports Findings on “Super-injunctions”

A Committee chaired by the Master of the Rolls, Lord Neuberger, has published its findings on super-injunctions, anonymity injunctions and open justice.Its report has been made to the Lord Chief Justice, the Lord Chancellor, and the Civil Procedure Rules Committee.

Lord Neuberger’s Committee was formed in April 2010 following a report of the Culture, Media and Sport Select Committee, and in the light of growing public concerns about the use and effect of what were termed super-injunctions and the impact they were having on open justice. The membership of the Committee brought together legal specialists, including representatives of the media and of claimants, to try and resolve the concerns that had arisen as a result of recent cases and the coverage and reaction that has followed.It provides guidance to lawyers and journalists of the steps to be followed before a super-injunction or an anonymised injunction is applied for. The Committee has also produced a draft form of Guidance and a draft Model Order for use in future cases. Taken overall the effect of the report will be to clarify the court processes and to establish the framework in which such applications may be made and should be decided.

Lord Judge, Lord Chief Justice, welcoming the report said:

“No one, and in particular no judge, doubts that the open administration of justice is a long-standing, treasured principle of our legal system.

“Before 2000 there was in England and Wales no general right to privacy and therefore no right to an injunction to protect or enforce any general claim to privacy. The development of privacy rights since 2000 was an inevitable consequence of the enactment of the Human Rights Act 1998 and the incorporation of the European Court Convention of Human Rights, and in particular article 8 of the Convention, into domestic law. That consequence was indeed clearly explained to Parliament before the Human Rights Act was enacted.”

“Contrary to some commentary unelected judges in this country did not create privacy rights. They were created by Parliament.Now that they have been created judges in this country cannot ignore or dispense with them: they must apply the law relating to privacy matters as created by Parliament, including those relating to the enforcement of privacy rights by injunctive relief, balancing them with the rights underlined in Article 10 and the principle of freedom of expression. The relationship between Parliament and the courts has, for generations, been predicated on mutual understanding and respect.Judges have never asserted, and they are not now asserting, any authority or jurisdiction over Parliamentary proceedings or debate, which are exclusively matters for Parliament.”

“Notwithstanding its distinguished membership, Lord Neuberger’s Committee was not vested with any authority to enlarge or reduce any of the principles of open justice and freedom of expression or privacy or confidentiality rights. “However the report will have a valuable practical effect on the way in which the courts deal with applications for injunctions based on alleged privacy rights.”

Lord Neuberger said:

“Our starting point was the maintenance of the fundamental principles of open justice and freedom of speech. Where privacy and confidentiality are involved, a degree of secrecy is often necessary to do justice. However, where secrecy is ordered it should only be to the extent strictly necessary to achieve the interests of justice. And, when it is ordered, the facts of the case and the reason for secrecy should be explained, as far as possible, in an openly available judgment.

“We have tried to achieve a procedural system which strikes a fair and proper balance between the principles of open justice and freedom of expression for the public and the media, and an individual’s right to confidentiality and privacy.

“I am really grateful to all the members of the Committee for the expertise they have contributed and the hard work they have done in compiling the report. I am pleased and impressed by the extent to which the competing interests of the media and of claimants have managed to reach agreement on our proposals, which I hope and expect will improve the interests of justice and the rule of law.”

The Committee’s terms of reference were confined to the use of injunctions in (the context of) claims based on privacy rights.They did not address exceptions to the principles of open justice in other types of proceeding, such as family proceedings or Court of Protection proceedings.

The key findings and recommendations are as follows:

As the Courts have frequently emphasised, open justice is, and has long been, a fundamental constitutional principle. It requires that all aspects of court proceedings should be open to, and freely discussed by, the public, and in particular, the media, and only permits oflimited exceptions, either those which are created by statute, or those which involve judicial discretion, to the extent that they are strictly necessary in the interests of justice.

Although confidential information has long been protected, a general right to respect for privacy was not recognised until 2000.Concerns have been expressed in some quarters about the way in which the law of privacy and confidentiality has developed since the introduction of the Human Rights Act 1998, particularly in interim injunction cases, given Parliament’s intention in passing section 12 of that Act, which was particularly concerned with maintaining a balance between privacy and freedom of expression. These concerns must be addressed either on a case-by-case basis by the courts or, at a more general level by Parliament.

A super-injunction is an interim injunction which restrains a person from: (i) publishing information which concerns the applicant and is said to be confidential or private; and, (ii) publicising or informing others of the existence of the order and the proceedings.

An anonymised injunction is an interim injunction which restrains a person from publishing information which concerns the applicant and is said to be confidential or private where the names of either or both of the parties to the proceedings are not stated.

There was justifiable concern, when the Committee was formed, that super-injunctions were being applied for and granted far too readily. This concern has now been addressed. Since January 2010, so far as the Committee is aware, two super-injunctions have been granted, one which was set aside on appeal and the second which was in force for seven days. Super-injunctions are now only being granted, for very short periods, and only where this level of secrecy is necessary to ensure that the whole point of the order is not destroyed.

There has also been an increase in the number of cases which are anonymised. The law on anonymisation has been clarified in two recent Court of Appeal decisions. Confusion has arisen as many cases with privacy or anonymity aspects have been wrongly labelled as super-injunctions.

When anonymised orders are made, the court has and should wherever practicable provide a reasoned judgment for its decision.

The Committee has produced draft Guidance setting out the procedure to be followed when applying for injunctions to protect information said to be private or confidential pending trial. This procedure will enable the media to be informed about applications in advance as Parliament envisaged when it passed section 12 of the Human Rights Act 1998.

The Committee does not consider specific guidance on expedited appeals is necessary as such guidance already exists. It should however be revised and updated. It also recommends that training for judges who hear applications for injunctions which may impact on the principles of freedom of expression should continue.

The Ministry of Justice, with the assistance of HMCTS, should collect data about super-injunctions and anonymised injunctions, in relation to all privacy orders which derogate from the principles of freedom of expression.It is anticipated that the Ministry will implement this recommendation as soon as practicable.

The court has never asserted, and could not properly assert, power or authority to restrict Parliamentary debate or proceedings. The relationship between Parliament and the courts is predicated on mutual respect and confidence. The chapters in the Report which address questions relating to Parliamentary privilege and process have been disclosed to the Speaker of the House of Commons and to the Lord Speaker in the House of Lords. It is intended that any issues arising in the context of claims for injunctive relief on the basis of privacy will be discussed further with them,

Media reporting of what was said in Parliament is only protected if it is a summary of Hansard published in good faith. The extent, if any, to which other media reports of Parliamentary proceedings in breach of a court order would be protected is unclear.

Report of the Committee on Super-Injunctions (PDF 525kb)