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The escrow contract, a mechanism for guaranteeing and securing private and public contractual relations

Author(s): George-Bogdan Ioniță / Language(s): English Publication Year: 0

The present study aims to analyse the formation mechanism but also the effects that the use of the escrow contract produces in the contractual relations between the parties. The necessity and utility of the study results from the fact that the Romanian legislation does not expressly regulate the escrow contract, therefore falling within the scope of unnamed contracts. The thesis from which this research is founded is based on the purpose and role of the escrow contract, namely, to generate an "additional guaran- tee" to the parties already involved in a main contractual relationship, which will be ancillary grafted to the escrow contract. Thus, a first objective of the research will aim to analyse the formation method, the particularities but also its effects in the relations between the parties but also the relationship between the main contract and the accessory one. A second objective of the research will materialize through the careful study of legal texts that directly refer to and regulate the use in certain areas, such as privatization or insolvency, of escrow accounts in order to secure already existing contractual relations between the parties. In order to carry out this research, the aim will be to study the updated legislation that refers to the subject of the escrow account contract, the relevant jurisprudence but also the specialized doctrine in the field.

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A contemporary overview of the factoring agreement

Author(s): Sónia de Carvalho / Language(s): English Publication Year: 0

Modern factoring resulted from the adaptation, in the 15th and 16th centuries, of the Atlantic trading posts to the commercial activity between England and the United States, in which, by virtue of their intensity, commercial warehouses took on a more financial than commercial feature. In the course of this evolution, these intermediaries, in addition to the distribution and consultancy tasks, began to guarantee the fulfilment of the transaction (del credere factors), often granting advances to European producers on the price of goods before sold. The factors thus became known as the 'financiers of European industry'. This sophistication of the intermediary conceived in European merchant schemes was at the origin, between the 16th and 19th centuries, of the colonial factoring, the predecessor of the modern factoring, in which the factor, in addition to distributing the products of European exporters, with special focusing on the textile field, in the New World markets, start collecting its credits, which in the meantime were assigned to it, and financing, through the provision of advances on sales. Later, colonial factoring gave way to old line factoring, which has assumed since the beginning a financial nature, providing a new range of services. In the old line classic scheme, the factor thus assumes four essential tasks: collection and management of assigned credits; provision of consultancy services; financing through the granting of advances on assigned credits and guarantee of the debtor's compliance and solvency. The financing role is undoubtedly one of the main reasons that motivate the use of this contract. Indeed, the need to attain financing, in addition to banking, with a greater incidence in times of credit restriction, is pointed out by many authors as one of the main justifications for the use of factoring in Europe. The crisis currently experienced worldwide following the Pandemic COVD 19 and the role that this contract can play in the economic recovery, through the financing the SMEs, justifies the analysis of the evolution of this contract, as well the legal framework in Portugal.

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Corporate financing

Author(s): Sebastian Bodu / Language(s): English Publication Year: 0

Two are the external sources of corporate financing: equity and debt. These are exclusive and can be combined in turn (other sources of external financing no longer exist, but only variants thereof). Capital with which a company is financed is its engine, no company being able to operate without capital regardless of the industry. Funding may be private or public. Private financing is provided through banking credit or equity contracted through direct negotiation with investors. Each mode of financing has advantages and disadvantages, not only in terms of financial costs (direct) but also indirect costs. Internal funding source is self-financing, i.e. reinvesting the company's profit in- stead of distributing it in the form of dividends. Balancing the use of internal and external financing sources, as well as the share of an external source in relation to another external source, primarily depending on the cost of financing (direct or opportunity) is a difficult, important and complex decision. The more the company is and/ or the more attractive for investors, the more varied the range of financing options and the cost structure that is heavily influenced by rating agencies. Conversely, a small company without too many development prospects will not have access to all available sources in the market and will have to confine itself to small bank loans. A specific form of finance is the financial assistance. This is crucial in performing Leverage Buyouts or Management Buyouts. Although it was prohibited by the first form of the Second Companies Directive, now it is fully permitted provided that the company complies with the acquisition of its own shares, this being protected both the creditors and the shareholders. Unfortunately, Romania did not transpose the last form of the former Second Companies Directive (2006), not even after the recast or codification by Directive 2017/1132.

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Debt moratorium during the state of emergency and the state of alert

Author(s): Ciprian Chiorean / Language(s): English Publication Year: 0

The regulation of the application of the debt moratorium was rolled out by adaptation and implementation at the level of the internal law, so that its effect is the one expected by the union of the European legislative framework with the internal legislative framework. Although there is a common goal, despite the guidelines set out by the E.B.A., there is no unitary vision at the level of European states regarding the moratoriums im- plemented, the solutions adopted by each EU Member State being diverse. Since the be- ginning of the SARS-CoV-2 coronavirus pandemic, credit institutions have come to the aid of customers who were financially vulnerable, by implementing appropriate, concrete and effective measures to enable them to continue to meet their payment obligations. For the elaboration of this study was used the comparative analysis of the whole regulatory framework and the exposition of the way in which it was implemented at the level of each state affected by the pandemic.

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Protection of the right to redemption of shares of banking company reorganized by merger – internal rules and European case law

Author(s): Andreea Corina Tarsia / Language(s): English Publication Year: 0

The exercise of the right protected by art. 1 of Protocol no. 1 of the European Convention on Human Rights does not only depend on the obligation of the State not to interfere, but may require positive protective measures, especially when there is a direct link between the measures that the complainant can legitimately expect from authorities and the right to an effective observance of its "assets". Although art. 1 of Protocol no. 1 does not contain explicit procedural requirements, the Strasbourg Court has ruled that states have an obligation to provide judicial proceedings that can offer the necessary procedural guarantees and therefore allow local courts to rule effectively and equitably on any litigation between persons, both in cases involving state authorities and in cases involving only private parties. On the other hand, the European Court of justice has ruled that, in other circumstances, the right of withdrawal of shareholders in the event of a merger of the banking company may be limited on grounds of public interest, invoked in the context in which, banks or small groups of banks are not able to cope with, without excessive difficulties, for example in the case of financial deposits imposed by the newly established system of the European Banking Union. These situations highlight the serious shortcomings in resolving reimbursement of shares disputes, as they may raise the issue of reconciliation between shareholders' rights, based on Article 1 of the Protocol, and the general interest in consolidating the capital of the banking system and the need to maintain bank’s stability.

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Crowdfunding credit services (peer to peer lending) in the light of the Proposal for a Directive of the European Parliament and of the Council on consumer credits

Author(s): Simona Heseková / Language(s): English Publication Year: 0

The paper identifies the most significant problems associated with the absence of regulation of peer to peer lending, where debtors are consumers. The paper evaluates identified problems from the perspective of the Proposal for a Directive of the European Parliament and of the Council on consumer credits released on June 30th, 2021. The paper considers mainly the selected aspects of draft regulation as: definitions, the legal regime of crowdfunding credit service providers, the assessment of consumer creditworthiness, information asymmetry and registration of crowdfunding credit service providers. The paper considers the selected issues from the point of view of European Union law and takes into account the specifics of the Slovak legislation due to the absence of studies focused on peer to peer lending at national levels. Based on this approach, the paper makes de lege ferenda proposals.

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Beneficial ownership regulation: Slovakia and selected countries

Author(s): Daniel Zigo / Language(s): English Publication Year: 0

In recent years, especially within the European Union, Anti-money Laundering (AML) legislation has intervened in business law and introduced significant regulatory obligations in the area of registration of beneficial owners of companies. Although this regulation in the EU member states is based on the EU directives law, there is a relatively wide scope for its implementation and individual member states use different mechanisms of its operation, verification of data or sanctions. Slovakia differs from other countries in that there is a double regulation of beneficial owners for two different purposes. In this paper, we analyse the legislation and practice in the regulation of beneficial ownership in selected countries and describe our findings regarding the similarities and differences of individual models. In our research, we also focus on the possibility of implementing innovative regulation models in the Slovak Republic, where two different legal regulations are not addressed in an effective manner.

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The role and function of a bond security agent – problems and challenges

Author(s): Martin Winkler / Language(s): English Publication Year: 0

The legal regulation of the agent for securing receivables arising from issued bonds (bond security agent) in the Czech and Slovak legal system was inspired by common law, where the "bond trustee" is well established and brings long-term positive effects. However, since this is an institute derived from the legal regime of a trust, which has its roots in the common law legal system and the continental law did not initially know it at all, its application and legal regulation raises several legal problems (e.g. credit risk of the bond security agent, its conflict of interest, liability, termination of its position etc.). In this paper we analyze these problems and challenges, mostly derived from insufficient or unclear regulation and impact thereof on functioning of bond security agent in practice. We also propose several legislative changes of this legal institution.

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‘Gun Jumping’ in the merger implementation in the EU in light of the Altice Case

Author(s): Barbara Dufková / Language(s): English Publication Year: 0

The paper analyses the scope of the gun jumping prohibition in light of the judgment of the General Court in the Altice case (T-425/18). After introducing the facts of the case, it dives into the legal issues raised. It concentrates on the main areas of concern – the scope of Article 4(1) and 7(1) of the EU Merger Regulation, the pre-closing covenants in the transaction documentation and the exchange of information. The paper identifies four important implications of the Altice case. First, the case confirms that concurrent violation of notification and standstill obligation is possible. Second, it provides clearer guidance as to which pre-closing covenants may be regarded as granting the acquirer a possibility of exercising control over the target. Third, it confirms that a concentration may be implemented by pre-closing covenants regardless of their actual implementation. Finally, it makes clear that excessive information exchange may support the finding of decisive influence.

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Remuneration of insolvency practitioners in reorganization proceedings as a possible inspiration for preventive restructuring?

Author(s): Klára Vítková,Ondřej Zezulka / Language(s): English Publication Year: 0

The draft law on preventive restructuring transposing Directive (EU) 2019/1023 envisages creating the profession of restructuring practitioner. The aim of the article is to offer recommendations for the forthcoming legislation, which is to regulate the calculation of remuneration for this new profession. The article deals with the procedural position and tasks of the restructuring practitioner in preventive restructuring and compares them with the activities of the insolvency practitioner within the reorganization. Based on the similarities and differences, the article examines whether the existing model of remuneration of insolvency practitioner in the reorganization (monthly fee) can be considered a suitable inspiration for the planned decree on the remuneration of the restructuring practitioner. The recommendations de lege ferenda are also based on the analysis of alternative remuneration models (including the German transposition norm).

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Position and role of internal audit within the business group controlling mechanisms

Author(s): Jiří Bálek / Language(s): English Publication Year: 0

The aim of this paper is to define the position and the role of the internal audit within the controlling mechanisms of a business group as these are supplementary to supervisory functions. In some jurisdictions, internal audit forms an essential function with respect to the corporate governance. However, powers of the internal audit body or function are affected and vary due to its position in various legal structures. Within the EU (and Swiss) legislative framework, internal auditing provides independent assurance that governance and internal control processes are operating effectively. As a controlling mechanism, internal audit is in general more efficient if established under the powers of the statutory body than entrusted with the supervisory body. The supervisory powers of internal audit on the group level in the various possible legal structures set forth by the law are, however, mostly dependent on the recognition of the internal audit powers by the local group entities.

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The question of criminal liability of commercial companies under international law

Author(s): Sharique Ali Khan,Hamad Majed Alowaishiq / Language(s): English Publication Year: 0

The absence of criminal liability of companies under international law has created a well-documented accountability gap. Some multinational companies, in their pursuit of profit motives, make decisions that lead to criminal conduct. The United Nations Framework of Analysis for Atrocity Crimes shows an increase in the involvement of mul- tinational companies in crimes of atrocity. The current international legal framework and the Rome Statute of the International Criminal Court pose a challenge in the prosecution of these companies as it does not recognise legal persons. However, the breakthrough comes from a decision to assert jurisdiction over legal persons by the Appeals Panel of the Special Tribunal for Lebanon. Even though the scope of this decision is limited, it is still a substantial shift in how the criminal liability of companies is perceived in international law. This paper analyses these recent developments and highlights possible solutions to end the accountability gap.

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Restriction of ownership rights as an interference with freedom of enterprise

Author(s): Vladimír Šarapajev / Language(s): English Publication Year: 0

This paper is dedicated to business aspects of expropriation and further restrictions of ownership executed by state authorities. While strict proprietary implications of ownership restrictions seem to be self-explanatory and to arise from the very nature of such intervention, the business-oriented purpose of the affected estate is being taken into consideration rather exceptionally. Although such approach is partially based on the causal nexus limitations implemented during the establishment of value of the property as potential (and in many cases even hypothetical and speculative) use of the property cannot be perceived as a matter of course, in certain cases such use must be diligently considered in order to determine the actual extent of intervention into the constitutionally guaranteed rights. Using synthesis and analysis of current legal regulation, this paper aims to identify the implications of ownership restriction for business and suggest criteria for the assessment of the value of expropriated estate.

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Business law: collaborative economy vs. participatory economy in the digital age

Author(s): Nicolae Pană / Language(s): English Publication Year: 0

The general objective of the postdoctoral paper is to develop a multidisciplinary and cross-sectional study to highlight the role of artificial intelligence in the globalization of democracy and the opportunities offered by technological progress related to the legal phenomenon as a matter of fact. At the same time, the study includes an analysis of the risks to which enterprises and public authorities are subjected in the context of using new technologies and the impact that legal vulnerabilities may have on the calculation of management risks reported through artificial intelligence applications. This article is an integral part of the author's research in the postdoctoral program within ASE Bucharest - Faculty of Law and is focused on the fact that the collaborative economy and participatory economy are major challenges of democracy in general and participatory democracy. Following the analysis of these two concepts, we tried to emphasize the importance of digital processes in the process of globalization of democracy. The author used for this study among the usual research methods, the empirical approach corroborated with the historical approach that underlined the practical relevance of the theses proposed by well-known authors in the field. Among the results and implications, we mention the dissemination of knowledge of concepts and their analysis to the academic community and beyond, and the study can be useful in calibrating and improving management processes both in private/joint ventures and in local and central public authorities.

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Provisional measures concerning security for costs and security for claim in international commercial arbitration

Author(s): Sofia Cozac / Language(s): English Publication Year: 0

This paper is an analysis from a theoretical and case law perspective of the admissibility conditions for interim measures for security of arbitration costs and for security of claim. These types of interim measures belong to the category of interim measures that are less common in arbitral practice. However, according to recent statistics, applications for interim measures have increased exponentially in recent years. It is therefore important that the rules governing them are well-known by both parties as well as arbitrators, so that they can be correctly used in these situations. The major benefit is that the party requesting such measures will be protected from the possible insolvency of the other party. In other words, a party making unmeritorious claims who is also in a precarious financial situation could be discouraged by such a measure from pursuing possible bad faith claims. However, arbitral tribunals should carefully weigh the granting of such measures in order not to financially block the party initiating arbitral proceedings who may also be in a precarious financial situation due to the damaging actions of the party requesting such measures. Such a measure could amount to a denial of justice in international law, preventing the claimant's access to courts. What is essential in such a claim is for the arbitral tribunals to carry out detailed analysis, by balancing the interests of both parties in an attempt not to block the claimant's access to justice. This is why these types of requests are very rarely admitted, and only for sound reasons, as we will further demonstrate in the upcoming lines.

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Perspectives on the joint venture agreement in business law

Author(s): George-Bogdan Ionita / Language(s): English Publication Year: 0

This research aims to objectively analyze the applicability of the joint venture agreement in the business sphere. Determining the need to use such a legal mechanism in the field of contractual relations is an important starting point for presenting the specific elements but also its functioning mechanism. Thus, it will proceed to the analysis of the current regulation of the Civil Code as well as the practical applicability of this legal mechanism in various fields of law. In carrying out this research, works from the current specialized doctrine as well as current judicial practice were used.

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Some notes on the commercial concession contract

Author(s): Sónia de Carvalho / Language(s): English Publication Year: 0

The concession contract, to which the majority of legal scholars recognize the legal nature of a framework contract, is a commercial contract, which establishes a complex and long lasting contractual relationship, under which the grantor undertakes to sell to the concessionaire, and the latter to buy from him, for resale, a certain quantity of goods, assuming the risk of marketing the goods. The integration of the dealer, who acts on its own behalf and in its own name, in the grantor's network, is ensured by the compliance with certain obligations, relating to commercial policy and promotional and after sales services, under the control and supervision of the grantor. The concession contract started out as a sales contract concluded between the producer and the trader, who acted in his own name and for his own account, characterised by the existence of an exclusivity clause in favour of the latter, provided that he undertook to purchase a certain quantity of products. This negotiating scheme has, however, undergone alterations as a result of the greater integration of the distributor in the network of the licensor, resulting from the complex web of rights and duties around the parties, with emphasis on the transformation of the exclusivity clause, hitherto considered a social type element, into one of several possible clauses of the contract. Considering that we are dealing with a legally atypical, but socially typical contract, it is necessary to point out the most relevant clauses of the contract, which are essential to sustain that this contract belongs to distribution contracts, an autonomous category. The supply chain crisis currently experienced worldwide following the Pandemic COVD 19 and the role that this contract can play in the commercial distribution, by allowing the manufacturer to achieve greater efficiency in the distribution of its products, justifies the analysis of the main features of this contract.

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Legal regime of competition in Croatia

Author(s): Ovidiu Horia Maican / Language(s): English Publication Year: 0

Croatia has implemented EU’s competition rules. Competition Act lays down the competition rules and establishes the competition regime in Croatia. It also regulates work of the Croatian Competition Agency. The Competition Act defines the rules and methods for promoting and protecting competition. On paper, competitive equality is enforced with respect to market access, credit and other business operations. In practice, however, state-owned enterprises (SOEs) and government-designated “strategic” firms may still receive preferential treatment. The Croatian Competition Agency is the country’s competition watchdog, determining whether anti-competitive practices exist and punishing infringements. It has determined in the past that some subsidies to SOEs constituted unlawful state aid.

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Influencers: the path from consumers to professionals

Author(s): Aura-Elena Amironesei / Language(s): English Publication Year: 0

The concept of ‘influencer’ stands at the confluence of law, economy, marketing, sociology and psychology, being in a continuous grinding, generated by the development of social media tools and the diversification of the activities that can be carried out on social media. The influencer has crystallized his presence within the virtual environment, as he started to use social media from the position of a consumer. At the moment, he evolved into an entity that shirks the national imperative legal provisions and has a series of attributes which cannot characterise any other existing and conceptualised entity. The uniqueness of the influencer, along with his constant developing characteristics, have led to several difficulties in the process of regulating his activity. Nevertheless, the time that has passed since their emergence on the market is more than sufficient for providing the possibility of describing the influencers and confining them within a legal regime. Our analysis focuses on the compatibility between the status of a professional, as it is regulated in the Romanian law, and the status of influencer. Then, we will briefly discuss the possible consequences, determined by the compatibility, on the activity of the influencer and on his digital content.

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Translation of arbitral awards in the procedure for the recognition and enforcement of foreign arbitral awards. Conditions and assumptions

Author(s): Crenguţa Leaua,Radu-Mihai Necula / Language(s): English Publication Year: 0

The purpose of the article is to examine the manner in which the regulation of the applicant's ability to submit a certified translation for compliance with a foreign arbitral award responds to the legislative desire to facilitate the recognition and enforcement of foreign arbitral awards in Romania. It is approached the hypothesis in which the defendant disputes the accuracy of the translation or the court ex officio considers that the translation submitted to the case file presents certain ambiguities. In this case, the question arises as to whether it is necessary to file a translation by a certified translator in the case file or whether it is sufficient in that case to submit a translation by a party. The article also examines whether or not the provisions of the Code of Civil Procedure are more favorable or unfavorable than the provisions of the New York Convention (1958) with regard to the translation of foreign arbitration awards.

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