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Global rules on foreign direct investment (FDI)
Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
Global | Publication | January 2016
The Presidency of the Republic published in the Official Gazette No. 6,211 Extraordinary, dated December 30, 2015, Decree No. 2,179, with Rank, Value and Force of Law, the Reform of the Venezuelan Central Bank Law (“New BCV Law”). This legislation reforms the Decree with Rank, Value and Force of Law of the Venezuelan Central Bank Law (“Repealed BCV Law”), published in the Official Gazette No. 6,155 Extraordinary, dated November 19, 2014.
The New BCV Law provides a series of reforms among which we would highlight the following:
Under the provisions of the Repealed BCV Law, the President of the Venezuelan Central Bank (“BCV”) was appointed by the President of the Republic but had to be ratified by the majority of votes of the members of the National Assembly (“AN”). Nevertheless if these rejected successively two candidates, the President of the Republic would appoint it and the AN had to ratify. However, the New BCV Law, provides that the President of the BCV will be appointed by the President of the Republic, without the need for ratification by the National Assembly.
The Repealed BCV Law established that the AN was entitled to appoint two (2) BCV Directors by the majority of votes of its members. However, the New BCV Law provides that it is the President of the Republic who may appoint the six (6) BCV Directors, one of which will be the Minister of Finance.
The Repealed BCV Law stipulated that the AN should set up the Committee for the evaluation of merits and credentials, in charge of verifying and evaluating the credentials of the directorship candidates. Nevertheless, the New BCV Law grants such attribution to the President of the Republic.
Similarly, under the Repealed BCV Law, such committee was comprised by two representatives elected by the AN, two by the National Executive, and one by the National Academy of Economic Science. However, the New BCV Law provides that such committee will be comprised by two representatives elected by the AN, two by the President of the Republic and one by the Vice Presidents’ Council of the Ministers’ Council.
The Repealed BVC Law established that the removal of the members from the BCV´s Directorship could occur with two thirds vote of the AN members. Notwithstanding, the New BCV Law provides that the procedure for removal of any of the members of the Directorship may be initiated by the President of the Republic, the BCV President, or at least by two of its directors, without the need to remit the matter to the AN for approval. On the contrary, the decision now relies exclusively on the President of the Republic.
The New BCV Law provides that exceptionally – as long as that it does not conflict with the prohibition of granting direct credits to the national government, as well as guaranteeing the obligations of the Republic, States, Municipalities, Autonomous Institutes, State Companies, or any other organ of public or private nature – the BCV may obtain, grant, or finance credit to the State and public or private entities, when objectively, there is an internal or external threat to the security or other damage to the public interest, which the President of the Republic will determine through a confidential report; or in those cases approved unanimously by the directorship.
The New BCV Law provides that when required by the National Executive, the directorship, in the performance of its duties, may temporarily suspend the publication of information for the period during which there are internal or external situations that suppose a threat to national security and the economic stability of the nation.
The New BCV Law as well as the Repealed one, provides that the AN or its commissions may access the information or documents marked as secret or confidential, through a request to the BCV President. However, the New BCV Law includes that the latter will assess the submission of such information or documents, or their substitution for a report that collects the relevant aspects for the requesting entity, when the nature of the information compromises the security or performance of the BCV.
Likely, the New BCV Law as well as the Repealed one, state that notwithstanding the periodic reports, the AN may request any information deemed convenient from the BCV, as well as the appearance of the BCV President. They also provide that in these cases the confidential information must be directly handed to the President of the AN. However, the New BCV Law establishes that such submission will be done in accordance with Article 42, in other words, submission of such information or documents, or their substitution for a report that collects the relevant aspects for the requesting entity, when the nature of the information compromises the security or performance of the BCV.
The New BCV Law includes that the BCV shall agree with the National Executive the outline of procurement of information, during internal or external circumstances that threaten national security and the economic stability of the nation.
The New BCV Law as well as the Repealed BCV Law, provides that the import, export or trade of Venezuelan or foreign currency, of legal use in their respective countries, are subject to the regulations established by the BCV. However, the New BCV Law adds “including authorization for the arrival and departure from the territory (…) of monetary species representatives of the bolivar”.
Publication
Cross-border acquisitions and investments increasingly trigger foreign direct investment (FDI) screening requirements.
Publication
On February 2, 2024, the Belgian Presidency of the Council of the European Union confirmed that the Committee of Permanent Representatives had signed the Artificial Intelligence (AI) Regulation, referred to as the AI Act. Approval by the EU Parliament followed on 13 March 2024, and the AI Act is likely to appear in the EU’s Official Journal around May 2024. The AI Act aims to establish a stringent legal framework governing the development, marketing, and utilisation of artificial intelligence within the region, thereby marking a significant advancement in the regulation of this burgeoning domain.
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The private credit market and direct lending have grown and diversified immensely in the past decade, offering alternative sources and terms of debt compared to those historically provided by the syndicated leveraged loan and public issuance markets. Consequently, they are fast becoming pivotal components in the capital ecosystem, so much so that the Bank of England consider that the private credit market is currently responsible for approximately $1.8 trillion of debt issuance, which is four times its size in 2015. This growth has been particularly pronounced in Europe and the US but there has also been significant activity in Asia.
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