Clifford Chance
Corporate Update
6 July 2011
Welcome to our latest edition of Corporate Update, which provides a round-up of developments in company law and corporate finance regulation over the last six months.
Companies cannot have failed to miss the 1 July 2011 deadline for implementation of the new Bribery Act. Following the publication in March of the Ministry of Justice’s final Guidance on anti-bribery compliance procedures, many companies will have spent the last few months examining and refining their internal and external policies on anti-bribery to ensure that they have adequate procedures in place to prevent bribery within their organisation.
On the regulatory front, we examine the decision of the FSA to fine JJB Sports £445,000 for its failures to keep the market properly informed about the true cost of two acquisitions it had made in breach of DTR2.2, and a recent ruling of the Upper Tribunal in the Massey case, where the Tribunal was asked to review a decision of the FSA finding Mr David Massey guilty of market abuse. These two decisions raise concerns for both issuers and their advisers as they indicate a potential shift in the FSA’s view of how issuers should approach the question of whether information is “inside information” which should be released to the market. See the “Regulatory Update” section for further information.
This year has also seen the first successful prosecution of a company for corporate manslaughter. However, given the defendant was a small company run by a sole director, the scope of the corporate manslaughter legislation, which can result in an unlimited fine for any company convicted under it, has not really been tested. The Crown Prosecution Service has indicated that there are a number of prosecutions involving larger companies with more complex management structures in the offing which are likely to give us a better idea of how the legislation will apply to such organisations.
The above topics and a host of other recent corporate developments relevant to companies and their advisers are examined in this Corporate Update.
