Background

The European Union (Insurance and Reinsurance) (Amendment) Regulations 2021 (2021 Regulations) will come into operation on 30 June 2021, giving effect to Directive (EU) 2019/2177 of the European Parliament and of the Council of 18 December 2019 (2019 Directive).

The 2019 Directive amends the Solvency II Directive (2009/138/EC), the MiFID II Directive (2014/65/EU) and the 4th Anti-Money Laundering Directive (2015/849/EU).

On 24 September 2020, the European Commission (the Commission) relaunched its Capital Markets Union project with the publication of its ambitious new initiative,"A Capital Markets Union for people and businesses – new action plan" (the Action Plan). The purpose of the Action Plan is to reduce the current fragmented approach in financial markets and to tackle some of the remaining barriers to a single European capital market.

On January 17, 2017, the US Court of Appeals for the Second Circuit ruled in favor of the defendant in Marblegate Asset Management, LLC v. Education Management Finance Corp.1, by vacating the decision of the District Court for the Southern District of New York (the "District Court") and finding that "Section 316(b) [of the Trust Indenture Act] prohibits only non-consensual amendments to an indenture’s core payment terms." This decision, combined with the recent ruling of the District Court in granting a motion to dismiss in Waxman v. Cliffs Natural Resources Inc.

Indentures governing high yield and investment grade notes typically provide for a make-whole or other premium to be paid if the issuer redeems the underlying notes prior to maturity. The premiums are intended to compensate the investor for the loss of the bargained-for stream of income over a fixed period of time.[1] Generally, though, under New York law, a make-whole or other premium is not payable upon acceleration of notes after an event of default absent specific indenture language to the contrary.