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Eurotunnel declared a moratorium on the payment of interest on the major part of its debt on September 14 1995. An outline agreement on a restructuring plan was reached between Eurotunnel and a steering group of its bank lenders 12 months later, on October 2 1996. Eight months later in May 1997, detailed terms sheets were agreed. The proposals were then put to Eurotunnel's shareholders and the whole banking syndicate of nearly 200 banks for approval — the agreement of each individual bank was required. The Restructuring Agreement was signed on January 29 1998 and the restructuring finally became effective two months later, on April 7 1998. The corporate structure of Eurotunnel is unusual. There are two separate corporate groups linked at the holding company level by the listing and trading of their shares in units, and at the level of the principal subsidiary of each group because the concession to build and operate the Channel Tunnel was granted jointly to the two companies (see box).

The law of the country where a bank account is kept will usually govern the banker-customer contract. However, the law of another country may affect the account.

Creditors have several options under the Malaysian Companies Act 1965: the company can be wound up, put into receivership or have its assets possessed. By Philip Teoh Oon Teong of David Chong & Co, Kuala Lumpur

Philadelphia-based firm Morgan, Lewis & Bockius LLP's problems in Indonesia continue. The investigation of the firm launched in February for allegedly offering Indonesian law advice in contravention of its licence (see International Financial Law Review, March 1998, page 3) has now been complemented by a full study of the activities of foreign firms in the jurisdiction and a move to revise and clarify the rules. Bertie Mehigan, head of Morgan Lewis's Singapore office, says he understands that the Indonesian police stopped their investigation of the firm in mid-April. However, on April 22 (one week after the supposed end of the investigation) Adnan Buyung Nasution, name partner at Indonesia's Nasution, Soedibjo, Maqdir & Partners, said: "The Indonesian authorities are still interrogating them, the lawyers and employees. We are still waiting for the result of the investigation." He hopes the investigation will be finished by mid-May.

US firm Wachtell, Lipton, Rosen & Katz, advised insurance group Exel on its US$2.9 billion agreed bid for rival insurer Mid Ocean. Davis Polk & Wardwell advised Mid Ocean. Both businesses are based in Bermuda. The combined organization will rank, on the basis of market capitalization, as one of the 25 largest property insurers in the world. Coordinating Wachtell Lipton's team is corporate partner Craig Wasserman. The lawyers for Davis Polk include corporate specialists George Bason and John Knight and tax partner William Gifford.

In a landmark judgment of the Texas Supreme Court, a partner at a Houston firm has lost her unfair dismissal case after she was sacked for querying a colleague's bills. Critics of the decision fear the ruling could discourage lawyers from fulfilling their ethical obligations. Houston firm Butler & Binion fired Colette Bohatch after she became concerned about fees charged to a client, Pennzoil, by John McDonald, the managing partner of the Washington office. Bohatch copied portions of McDonald's time diary and asked the firm's managing partner to investigate. The next day McDonald told Bohatch that Pennzoil was dissatisfied with her work. An internal investigation into Bohatch's complaints was carried out but no evidence of wrongdoing was found. Bohatch was advised to find another job and was told to leave the offices a year later.

US firm Davis Polk & Wardwell is representing Aetna in its acquisition of New York Life Insurance. New York Life is being advised by Skadden, Arps, Slate, Meagher & Flom, New York. Aetna has agreed to pay an initial US$1 billion in cash for New York Life, with contractual payments of up to US$300 million if earning targets are met. The Davis Polk & Wardwell lawyers who are working on this deal include corporate partners Lewis Kaden, David Caplan and tax partner Po Sit. In New York, Skadden Arps's team includes mergers and acquisitions partners Jeffrey Tindell and Robert Sullivan. Also in New York are partners Michael Weiner (antitrust), Stuart Levi (IP) and Neil Liff (employment). In Chicago, Louis Freeman is handling the tax issues.

Qwest Communications International agreed to buy LCI International, the American long-distance company in an all-stock transaction worth US$4.4 billion. The acquisition should be closed in June. O'Melveny & Myers, New York, are advising Qwest. The team is led by corporate partner Drake Tempest and includes partners David Litt (corporate) and Dan Dunn (tax).

The Commission proposed a Directive to eliminate withholding taxes on payments of interest and royalties between associated companies in different member states. Taxes levied at source either by deduction or assessment can involve time-consuming formalities, cash-flow losses and double taxation for companies engaged in cross-border business. The Commission therefore proposed that taxes on payments of interest and royalties should be levied only in the member states where the companies receiving the payments are located. Commissioner Monti says this would remove a 'significant tax handicap' to companies' cross-border operations.

The IMF recently declared that measures taken by the Brazilian government in the aftermath of the Asian financial crisis have prevented the extension of the crisis to Latin America. The IMF also emphasized that the Brazilian stabilization programme depends on the implementation of constitutional amendments on public administration, social security and financial matters. The finance minister, Pedro Malan, stated that the reforms would need to be approved and implemented within two years. Meanwhile, Brazil's financial situation would be sustained with the proceeds of the privatization programme.