|This issue of Venable's Fund Forum provides (i) an overview of new disguised sale and partnership liability regulations, (ii) an update on Brazil President Temer's plans for a privatization program, (iii) a summary of the mandatory cybersecurity regulations proposed by the New York State Department of Financial Services, (iv) revisions to recently published country policy overviews of fund formation rules, and (v) a brief review, audio recording, and presentation materials from our recent webinar on firm culture.|
New Regulations: Disguised Sale and Partnership Liability
New regulations on disguised sales and the allocation of partnership liabilities may have a profound effect on partners and partnerships going forward, particularly with respect to a partner's ability to use a guarantee to obtain tax basis or avoid a disguised sale. Read more.
Brazil's President Temer Announces Plan for Concessions and Privatizations
Michel Temer, the acting president of Brazil, recently announced certain changes to an infrastructure and privatization program called "Growth." The revisions to the program aim, among other goals, to make the bidding process, as well as the operation of each of the various concessions, more attractive to international investors. You can read more about Growth here.
Mandatory Cybersecurity Regulations Proposed in New York
The New York State Department of Financial Services (DFS) recently released a set of proposed cybersecurity regulations for financial service institutions regulated by DFS. The regulations will require "Covered Entities" to (1) establish a cybersecurity program; (2) adopt a cybersecurity policy; (3) appoint a Chief Information Security Officer; (4) conduct third-party due diligence; and (5) undertake various other related obligations. The regulations are scheduled to go into effect on January 1, 2017, after which Covered Entities will have 180 days to comply. Read more about the requirements here.
Country Policy Overviews – An Update
Venable attorneys Philip von Mehren and Damien Scott, in conjunction with four Latin American law firms,* recently updated the private equity policy overviews for Chile, Colombia, Mexico, and Peru that they had co-authored with the same firms earlier this year. The overviews provide readers with summaries of the relevant legal regimes on private equity investments in each jurisdiction and were updated to reflect recent legal developments. These overviews were presented and distributed to 121 individuals from 70 Latin America-focused PE firms, and 99 individuals from 52 limited partnerships at the annual LAVCA Summit & Investor Roundtable in New York in September. The full summaries can be found here.
*Alterra, Brigard & Urrutia Abogados, Nader Hayaux & Goebel, and Philippi Prietocarrizosa Ferrero DU & Uría.
Firm Culture Webinar – Presentation Materials Now Available
Firm culture has long been a target of regulators of the financial services industry as the culprit in many scandals. In that regard, in its 2016 Regulatory and Examination Priorities Letter, FINRA again identifies firm culture as the cause of systemic breakdowns in the financial services industry. FINRA Chairman Richard Ketchum stated: "Nearly a decade after the financial crisis, some firms continue to experience systemic breakdowns manifested through significant violations due to poor cultures of compliance." Interestingly, Chairman Ketchum also pointed to the application of research by behavioral scientists to the evaluation of firm culture.
To listen to a recording of our recent webinar on firm culture, Firm Culture and Financial Services: How Research May Drive Regulation, and view the corresponding slides, please click here. A copy of the handout can be downloaded by clicking here.