Overview
The CRD package updates the EU banking regime and consists In our recently launched service, Rulefinder Cross-Border Lending, we consider the legal and regulatory issues which impact how to structure a range of cross-border lending activities. As part of the analysis, we ask local counsel to set out information on how cross-border lenders take and hold security/collateral from a borrower in their jurisdiction. We have set out below 3 considerations flagged when taking security in Middle East jurisdictions.
- In Saudi Arabia, promissory notes are the preferred form of security by all lenders due to speed and ease of enforcement
- In the ADGM and the DIFC, it is not uncommon for cross-border lenders to take security over: (i) shares in an ADGM/DIFC entity; and (ii) the assets held by such ADGM/DIFC entity located in less creditor-friendly jurisdictions
- In the ‘onshore’ UAE, security over shares in companies established in the UAE and real estate assets cannot be held directly by a cross-border lender and must be granted in favour of a Central Bank-licensed bank or financial institution. It is common practice to appoint an onshore security agent for the purpose of holding such security
How aosphere can help
Rulefinder Cross-Border Lending is a comprehensive analysis of the legal and regulatory issues which impact how to structure cross-border lending and security activities. Red flag issues are identified in an easy-to-use summary and underpinned by detailed analysis from leading local counsel around the world.
The information is updated daily by our dedicated team of experts, so you always have the latest position at your fingertips without having to incur the time and hassle of local lawyers.
