UK

Briefings

Briefings in English - 2003

This briefing looks at the implications of deficits in pension funds as disclosed in accounts and actuarial valuations. Various methods for dealing with such deficits are discussed together with statutory requirements. (December 2003)

New UK E-Privacy Regulations

UK regulations implementing the E-Privacy Directive (2002/58/EC) will come into force on 11 December 2003. Key provisions include: (a) controls on sending unsolicited marketing emails ('spam') and SMS; (b) rules on the use of cookies by website operators; and (c) rules on the use and retention of electronic communications traffic data and location data. The new laws are the subject of initial guidance from the UK Information Commissioner. (December 2003)

Pensions: salary and bonus sacrifices

At a time when many employers are seeking ways of reducing pension costs, some are cutting benefits and/or increasing member contributions. However, one means of reducing costs which has a lesser effect on employees is salary sacrifice. (December 2003)

Provision of pension benefits over the lifetime allowance

Perhaps unexpectedly, the Revenue proposals published on 10 December 2003 did not seek to eliminate all forms of unapproved pension provision. Both the earlier Inland Revenue paper and the Department for Work and Pensions paper issued in December 2002 suggested that the aim was to reduce the eight current tax regimes to one regime, so it seemed that steps might be taken to eliminate unapproved schemes. However, instead the intention is to remove all tax advantages from both funded and unfunded unapproved arrangements. (December 2003)

Simplifying pension taxation: The Government's proposals

The Inland Revenue's second consultation paper on pensions, published jointly with the Treasury on 10 December 2003, proposes a radical overhaul of the tax rules for pensions. Under the proposals a single simplified set of rules would apply to all pension schemes, replacing the existing set of six approved regimes. (December 2003)

Treasury shares

From 1 December 2003, listed companies that buy back shares out of distributable profits will be able to hold those shares in treasury, rather than having to cancel them. This briefing looks at the potential benefits of treasury shares and some practical points companies should consider if they want to take advantage of the changes in the law. (December 2003)

Tribunal quashes OFT merger clearance decision

For the first time the Competition Appeal Tribunal (CAT) has quashed an OFT decision clearing a merger without referring it to the Competition Commission. The CAT has decided, in essence, that the OFT will have to refer mergers to the Commission for detailed examination, except where these mergers can be shown to raise no issues. (December 2003)

Corporate governance risks

The 21st century has seen an unprecedented surge in corporate scandals. As a result investor confidence has slumped and governments around the world are introducing reforms to corporate governance. The question now being asked is what effect this combination of scandal and reform is having on the liability of UK companies and directors. Will we see a dramatic rise in shareholder litigation? (November 2003)

Finance Act 2003: Exchange of information (sections 197-199)

By Susan Bell (London). This article describes the Finance Act 2003 provisions regarding the UK's obligations to exchange information to other jurisdictions under EU legislation covering tax generally, under tax treaties and tax information exchange agreements and the forthcoming EU Savings Income Directive. It was first published in British Tax Review. (November 2003)

Sexual orientation and religious discrimination

New rules come into force at the beginning of December prohibiting discrimination against employees based on their sexual orientation, religion or beliefs. Most aspects of the Employment Equality (Sexual Orientation) Regulations 2003 and the Employment Equality (Religion or Belief) Regulations 2003 are familiar from existing discrimination rules. This briefing outlines the regulations' main provisions and highlights areas where employers should review their policies to reduce the risk of claims. (November 2003)

Sexual orientation discrimination and pensions

New legislation will imply into occupational pension scheme rules a rule prohibiting discrimination on the grounds of sexual orientation in respect of periods of service from 1 December 2003. This briefing looks at the current law and considers the changes to be made by the new law. (November 2003)

The Proceeds of Crime Act 2002

The Proceeds of Crime Act 2002 (POCA), which came into force in February 2003, increases the likelihood of firms having to make a disclosure. But when doing so, they may be caught between their obligation not to divulge details of the disclosure to their client, and their contractual obligations to the client. This briefing looks at the practical issues POCA raises regarding those obligations and offers some practical advice if a disclosure is necessary. (November 2003)

Implementing the Distance Marketing Directive: another compliance regime

The FSA has published its proposals to implement the Distance Marketing Directive. The Directive is intended to help cross-border marketing of retail financial services by harmonising information requirements and cancellation rights. However, its implementation will require firms to operate a separate compliance regime for products sold at a distance. (October 2003)

The Listings Review - Consultation paper

This briefing paper examines the FSA's key proposals for change and assumes that the reader is broadly familiar with the existing listing regime. (October 2003)

Competition action before the courts: where next?

There have been three recent judgments in the English courts on private enforcement actions. In this briefing we look at these cases and some of the issues that arise when private action is used as an alternative to regulatory enforcement. (September 2003)

Employee share incentives in the UK

This guide looks at the main types of share incentive scheme, concentrating on schemes which a listed company, or a company about to float, may wish to introduce. (September 2003)

Minutes of trustees' meetings: disclosure issues

This briefing looks at the law on disclosure of both the minutes of trustee meetings and documentation on which trustee decisions may be based. The sources of the law are both legislative and judicial. Recent cases have developed and shifted long understood principles regarding disclosure of trust documents. (September 2003)

New Combined Code - implementation of the Higgs Report

The revised Combined Code implements most of the recommendations made in the Higgs Review of the Role and Effectiveness of Non-Executive Directors. Some of the more controversial Higgs recommendations have been dropped and others have been diluted. The revised Code comes into effect for listed companies with reporting years beginning on or after 1 November 2003. This briefing explains the changes which have been made to the Code. (September 2003)

Communications Act - Media ownership

The Communications Act received Royal Assent on Thursday 17 July 2003. Under the Act, non-EEA companies will very shortly be able to own UK television and radio companies, and the scope for cross-media mergers will be increased. (July 2003)

Enterprise Act 2002: Competition law provisions

This briefing looks at key issues for directors in the competition law provisions of the Enterprise Act 2002. The implementation date for these provisions is 20 June 2003. (July 2003)

Exercising discretion in bonus schemes

Employers have two main issues to consider when making bonus decisions. They must decide whether individual employees are entitled to a bonus at all and then determine the level of the bonus that is to be paid. Failing to address these issues correctly can result in costly breach of contract and discrimination claims. This briefing suggests how the bonus process should be operated to try and avoid such claims. (July 2003)

The Arsenal case: Full time for unauthorized merchandising

After four years, the much-debated Arsenal v Reedcase has been resolved in favour of the brand owner.Justin Watts and David Brooks examine the decision and, below, specialists in different countries explain the impact of the case in Germany, France, Benelux, Spain, Italy and on OHIM. (July/August 2003)

The Data Protection Code: monitoring at work

The third part of the Employment Practices Data Protection Code limits the circumstances in which employers can monitor the activities of their staff. In this briefing we look at what amounts to monitoring; the steps employers should take when deciding whether monitoring is justified; and good practice to adopt if monitoring is carried out. (July 2003)

The Enterprise Act 2002 - Guide to the competition reforms

The last few years have been dramatic ones in the area of UK competition law. Radical changes to the UK competition regime since March 2000 have forced almost every company to rethink its competition compliance policies, strategies on risk management and day-to-day ways of conducting business. The aim of this guide is to provide you with an outline of the most recent changes to the UK competition regime introduced by the Enterprise Act 2002 (the Act). (July 2003)

Employee share schemes - Budget and Finance Bill update

The 2003 Budget and the Finance Bill are introducing a number of major changes to the taxation of approved and unapproved share schemes. Inland Revenue approved share schemes include company share option plans, save as you earn schemes and share incentive plans. Some of these changes came into effect in April 2003 and some will come into effect from a day linked to Royal Assent. (June 2003)

Legal professional privilege

The recent English Court of Appeal judgment concerning legal advice privilege in Three Rivers District Council v Bank of England raised questions regarding who the client is, what constitutes legal advice, and what documents are protected by legal advice privilege. The Hong Kong courts are not bound to follow decisions of the English courts. However, as English decisions are highly influential, it may be applied in Hong Kong. This briefing looks at the judgment in more detail. (June 2003)

Pension schemes: paying trustees

This briefing considers whether pension scheme trustees can be paid and, if so, whether they should be paid. Issues include whether paid trustees have a higher duty of care (and consequent increase in personal liability) and whether it is in the interests of the members that trustees be paid. (June 2003)

Pensions reform proposals: the White Paper

On 11 June 2003 the government published its White Paper on pension reform. Its proposals are aimed at improving member protection, making pension provision easier for employers and helping individuals to make informed choices about retirement planning. (June 2003)

Short selling: FSA feedback statement on DP 17

The FSA has published its feedback statement on DP 17. The FSA has confirmed its view that short selling is a legitimate investment activity, that significant changes to the existing regulatory regime are not warranted but that increased transparency would be useful. (June 2003)

Vitamins cartel judgment - Will it encourage damages claims?

A judgment in the vitamins cartel litigation means that it could now be easier to bring damages claims in cartel cases in the English courts, and possibly elsewhere. This briefing examines the judgment as well as the implications for those engaged in cartel related litigation. (June 2003)

FSA consultation paper 176 - Bundled brokerage and soft commission arrangements

The FSA has published a consultation paper (CP 176) on bundled brokerage and soft commission arrangements. CP 176 sets out the results of the FSA's review of the current regulatory regime for soft commission and bundled brokerage arrangements and recommends ways in which the regime could be strengthened. Comments on CP 176 should be sent to the FSA by 29 August 2003. (May 2003)

Pre-hedging convertible and exchangeable bond issues

The Financial Services Authority has published feedback on CP 149 and the text of the guidance added as an annex to the Code of Market Conduct. The guidance confirms that strategies entered into before the announcement of the launch of a convertible or exchangeable bond issue are likely to be regarded as market abuse where there is a legal or regulatory requirement to disclose the issue of the convertible or exchangeable bonds. (May 2003)

Taxing termination payments

A recent change in approach by the Revenue means it is now much harder for employers to make tax free termination payments. The key issue for the employer is whether the payment should be treated as earnings; if it is not, the first £30,000 of the payment will be tax free. (May 2003)

Legal advice privilege - Court of Appeal gives important judgment

The Court of Appeal recently handed down a judgment concerning legal advice privilege. The decision in the Three Rivers District Council v Bank of England case raised questions regarding who the client is, what constitutes legal advice, and what documents are protected by legal advice privilege. This briefing looks at the judgment in more detail. (April 2003)

Pension benefits during temporary absence: maternity and family leave

From April 2003 parliament has extended the periods of both paid and unpaid statutory maternity leave. It has also introduced rights to paternity and adoption leave. This means that pension scheme trustees and administrators should review their trust deeds and booklets (and the employer's policy in this area) to check that they reflect, or are flexible enough to cover, these new rights. (April 2003)

Written procedures: risk management or creation?

In light of increased regulatory control, corporates are starting to put into place written procedures covering their activities. However, care should be taken when preparing these procedures manuals, what terms are used in them, and how they are implemented. Failure to deal with this could mean financial exposure, regulatory sanction and damage to reputation. This briefing looks at some areas where caution should be exercised. (April 2003)

Custom and practice - rights or favours?

The risk of successful claims if an employer decides not to follow an established policy such as making enhanced redundancy payments can only be established through a careful investigation of the practice and its surrounding circumstances. Employers need to ask themselves whether the term has become a contractual right and understand how to reduce the risk of a term being implied. This will give them maximum flexibility to adapt their policy if required. (March 2003)

FSA consultation paper 171 - Conflicts of Interest: Investment Research and Issues of Securities

FSA consultation paper 171 Conflicts of Interest: Investment Research and Issues of Securities sets out the FSA's proposed guidelines to strengthen the regulatory regime for investment research and securities issues in order to promote higher standards. (March 2003)

Statutory money purchase illustrations

From 6 April 2003, pension schemes that provide money purchase benefits must include in members' annual benefit statements a forecast of the value of potential benefits that could be provided by the scheme - known as a statutory money purchase illustration. (March 2003)

Higgs Report - a more important role for non-executive director

The Higgs Report on the role and effectiveness of non-executive directors will increase the accountability of the boards of UK listed companies and give non-executive directors a more demanding and influential role. The Report's recommendations will be introduced as changes to the Combined Code. Higgs suggests that the revised Code take effect from 1 July 2003 and apply to financial periods commencing on or after that date. Although some of the recommendations will necessitate changes to current UK practice, overall reaction to the Report has been positive. (February 2003)

Higgs report - a more important role for non-executive directors

Keith Wotherspoon, European Intellectual Property Review, Issue 1. This article examines the potential copyright problems facing galleries and museums in the United Kingdom in relation to exhibiting works of art; investing in digital galleries; and exploitation of artistic works that are now out of copyright and in the public domain. (January 2003)

Inland Revenue consultation paper on pensions

The Inland Revenue's consultation paper on pensions, published on 17 December 2002, proposes a radical overhaul of the tax rules for pensions. Under the proposals there would be no ability for a member to remain within historic tax systems, although there would be a value saving of accrued benefits at the change date. (January 2003)

Opra review: suggestions for a new kind of regulator

In its Quinquennial review, published on 17 December 2002, the Department for Work and Pensions recommended the establishment of a new kind of proactive pensions regulator to replace Opra. This new regulator would actively seek to regulate employer pensions provision with a view to protecting scheme members. (January 2003)

Pensions reform proposals: the Green Paper

On 17 December 2002 the government published its Green Paper on pensions reform. Together with the Inland Revenue's consultation on tax reforms, the emphasis is on simplifying the body of pensions legislation and regulation. The Green Paper also concentrates on reforms aimed at protecting employees, working with employers to promote pensions in the workplace and creating a better understanding of the financial services framework. (January 2003)

Random testing for drugs - an invasion of privacy?

Random drugs testing is possible if employers have a well-drafted policy. Employers must decide whether testing is needed and, if so, for which staff. They must also be able to demonstrate a genuine need for testing. If they are satisfied that some form of testing is justified, they must address the type of testing needed and the sanctions to be applied where a drugs policy is breached. (January 2003)

The courts' approach to ADR

Since the civil procedure rules were introduced in April 1999, the courts have been actively encouraging parties to use alternative dispute resolution (ADR) instead of litigation wherever possible. This briefing looks at the rules that require both courts and parties to consider ADR and the effect of recent judicial decisions applying those rules. (January 2003)

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