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Freshfields of the UK and Germany's Deringer Tessin Herrmann & Sedemund have signed an agreement to associate formally with 40-lawyer Austrian firm Wolf Theiss & Partners. The firms have agreed to share resources and refer clients where necessary, as well as to exchange lawyers and form cross-firm practice groups. Partner Richard Wolf of Wolf Theiss explains: "We were in talks with Deringer when they were also talking to Freshfields, so we were able to seize the opportunity of doing something with both of them."

Barbara Galli talks to Olivér Glatz, General Counsel of the National Bank of Hungary

Brazil has won international support for its reform programme. A $41.5 billion loan is being made available over three years; $37 billion to be used, if necessary, in the first 12 months. Of the total amount, $18 billion is being secured by the IMF, $4.5 billion by the World Bank, $4.5 billion by the Inter-American Development Bank and $14.5 billion by a pool of 20 countries, including a contribution of $5 billion from the US. In return, Brazil is committed to attaining budget surpluses, before interest, of 2.6% of GDP in 1999, 2.8% in 2000 and 3% in 2001. The government aims to achieve this by implementing a programme described in a memorandum, which makes clear that the present exchange rate policy will remain unchanged to secure a low inflation rate. Brazilian domestic interest rates will be kept at about 20% in 1999. About $9 billion should be disbursed when the IMF approves the memorandum in a couple of weeks. Another instalment of about $9 billion would be available in February 1999 if the IMF is satisfied with the implementation of the programme. The programme includes:

Meredith Brown, Giselle Hantz and Scott Budlong of Debevoise & Plimpton, New York and London analyze the conflict between US regulation and the UK’s City Code in the light of the SEC’s cross-border proposals

UK firm Herbert Smith has opened an office in Bangkok. The office will practise both UK and local law and will enable the firm to consolidate its position in Asia. Heading the office is Henry Usckinski, formerly head of international arbitration at Coudert Brothers in Hong Kong. He will be assisted by Jonathan Pyne, a senior associate in corporate finance and former co-head of investment banking at Thai securities firm Krungthai Thanakit. The firm wants to include Thai expertise in its office and will recruit six to eight lawyers including Thai nationals.

Simon Gleeson, head of Richards Butler's financial services unit, is joining Allen & Overy on November 23. He will assist the firm in the development of its financial services group, providing advice on regulatory matters. The firm plans to create a group providing advice on UK regulations in financial services. The group will be built on the back of its banking practice, and, says Allen & Overy, will take a proactive role in the market. Gleeson says: "Regulatory advisers can be swamped with referral work by other parts of the firm. We want to go out in the market and build up direct relations with clients, providing them with a service which they don't get from the corporate guy."

In 1991, the House of Lords held that entering into interest rate swaps was outside the statutory powers of local authorities (Hazell v Hammersmith & Fulham). When banks claimed for restitution of sums paid to local authorities under void swaps, their claims were hindered by the 200 year old principle of law that money paid under a mistake of law is not recoverable. In Kleinwort Benson v Lincoln City Council, the House of Lords has now ruled that payments made under a mistake of law are recoverable. The law lords, by a 3-2 majority, held that:

The negotiations between Denton Hall, Richards Butler and Theodore Goddard over a possible three-way merger have been called off. The merger would have created the seventh largest law firm based in the UK, according to statistics gathered for the recently published 1999 edition of the International Financial Law Review 1000 directory. While the firms found they had a very good fit in London, that situation was not reflected overseas. Although the press release mentions "difficulties in merging the Hong Kong offices of Denton Hall and Richards Butler", sources close to the talks indicate that it proved impossible to reconcile the Asian aims of Denton Hall with the independence insisted on by the Hong Kong office of Richards Butler.

Securitization is rapidly becoming a common financing technique in Italy with new regulations modelled on foreign securitization rules. By Raffaele Rizzi of Baker & McKenzie, London

On October 1 1998, the Spanish parliament passed a law amending the Securities' Market Law and modifying various other aspects of Spanish securities market-related laws. Among the main features of this new law are the following: