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The International Securities Market Association (ISMA) has complained to the EU Banking Federation over its proposal for a European master agreement for repo transactions. ISMA has sponsored its own master agreement the Global Master Repurchase Agreement (GMRA) since 1992 supported by legal opinions from counsel in 30 countries in order to establish a global standard. It argues that an EU agreement is unnecessary and likely to create confusion in the repo market. Thomas Hunzinker, general counsel to ISMA in Zurich, says the draft proposal goes beyond standardizing the different agreements used for domestic transactions in the EU. "We would not be concerned with the attempt by the Federation to standardize national agreements and bring them more into line with European standards but we are concerned if what they are trying to do is to undermine or replace the GMRA," says Hunzinker. "It very clearly refers to a standard document that could be used for cross-border transactions within the EU and that raised a few eyebrows." Hunzinker has tried to clarify the scope of the proposal with representatives of the Banking Federation but has received no reply from the secretary general in Brussels nor from the domestic banking federations which are constituent members. Secretary general of the Federation Nicolaus Bömcke refused to return calls.

Linklaters & Alliance Linklaters & Paines (UK):

New legislation in Australia removes doubts as to the enforceability of netting in insolvency. It should boost local financial institutions. By John Stumbles and Edward Kerr of Mallesons Stephen Jaques, Sydney

Market access for foreign enterprises into China is still restricted. Particularly limited are possibilities for the establishment of foreign investment enterprises (FIE), including equity and contractual joint venture companies with Chinese and foreign investment as well as wholly foreign owned enterprises, directly engaged in trading and distribution activities.

In June the Minister for Economic Affairs tabled a proposal in parliament making it possible to merge (or cooperate through a holding company) between banks organized as savings institutions and mortgage credit institutions organized as member associations. On the same day BG Bank and Realkredit Danmark published their intention to do exactly that. Banks organized under the rules governing BG Bank until now have been subject to rules limiting shareholders' voting rights (also in a holding company controlling a bank organized as a savings institution company). The limitation of shareholders' voting rights may now be abolished by the shareholders. The abolition may pave the way for a mortgage credit association holding the majority of votes in a merged entity — as is required by law.

In a world of global finance and capital flows, the extra-territorial reach of national securities laws needs to be clearly defined. In the US, this is not the case. The absence of legislative guidelines has spawned considerable litigation.

Sirona Dental System, the dental equipment business, has issued a Dm170 million (US$309.1 million) to refinance a subordinated bridge loan facility related to its leveraged buy-out from Siemens by Shroders Venture. The total purchase price was Dm750 million. Warburg Dillon Read acted as lead manager for the offering.

Clifford Chance has completed its first SEC registered flotation in the US, as adviser to STET Mobile Holding (the selling shareholder) and to STET Hellas Telecommunications, one of the two GSM mobile telecom operators in Greece. The sale was of 12.1 million ordinary shares of STET Hellas in the form of American Depositary Receipts, registered with the SEC and quoted on the Nasdaq stock exchange, and of Dutch Depositary Shares listed on the Amsterdam stock exchange. The deal is valued at US$327 million. Clifford Chance's team included partners Rick Ely (US group) and Tim Schwarz (telecommunications) in London, and Frank Graaf in Amsterdam.

Riding high on London’s boom, foreign lawyers are benefitting from increasing US interest in Europe ahead of European Economic and Monetary Union. Barbara Galli reports

Settlement systems for national and cross-border payments carry risks relating to the insolvency of participants. A new legal basis for netting systems in the EU provides comfort. By Marianne Walsh and Markus Wellinger of Van Bael & Bellis, Brussels