Clifford Chance

Financial collateral remains a Gray area

19 November 2012

Do you have sufficient 'possession' or 'control' for your security interest to qualify for protection under the Financial Collateral Arrangement (No.2) Regulations 2003? Since the decision in Gray v G-T-P Group two years ago, the meaning of those terms has been debated at length. Has a recent High Court decision in the Lehman insolvency settled the matter? Certainly more thinking has been provided on these and other questions, such as whether the Regulations have retro-active effect, and issues regarding general liens. One thing is clear – financial collateral is still a complex topic.

Clifford Chance has prepared a briefing paper discussing some of the key issues.

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