Latest legal and regulatory news: 12th November 2020

Latest legal and regulatory news: 12th November 2020

In this issue:

In-house

Risk & Compliance

Commercial

Corporate

Information Law & TMT

Employment

Additional news—daily and weekly news alerts

New and updated content

Dates for your diary

Useful information

LexTalk®In-house: a Lexis®PSL community


In-house

Virtual networking and forum events

There’s no need to feel isolated if you are working from home—join one of our virtual networking or forum events. Even if you aren’t working from home, take some time to network with your peers, find out what challenges they’re facing and how they are meeting those challenges.

8 December 2020
Gift to you
Register now to attend

This session will focus on your personal and career development. There will be an executive coach guest speaker who will address virtual networking and leadership. The session will also include both a commercial and COVID-19 update.

Various dates from November to December 2020
LexisNexis Aspire Forum for Junior In-house Lawyers
To register your interest in joining the events, sign up as an Aspire member today

Aspire is a professional development and networking forum for junior in-house counsel. Following the success of the summer event series, we have several events planned for the remainder of the year to continue supporting you through these uncertain times and provide a platform for you to connect with your peers. Events take place at the same time each month, from 5pm to 6.30pm.
Upcoming subjects include mental health and junior in-house counsel, legal operations, career development and mentoring for junior in-house counsel and, of course, a Christmas quiz and networking social.




Risk & Compliance

Data protection

The European Data Protection Board (EDPB) has adopted recommendations on measures that supplement international transfer tools as well as recommendations on the European Essential Guarantees for surveillance measures. The basic methodology identified in the EDPB’s initial FAQs on Schrems II has been carried across to the new recommendations. However, the tests applied at various stages of the methodology are now worded differently. The EDPB has also made it clear that in assessing your international transfer, you cannot rely on subjective factors such as the likelihood of public authorities seeking to access the personal data in question in a manner not in line with EU standards. We are reviewing all content in our International transfers subtopic as a consequence of the EDPB recommendations. See: LNB News 11/11/2020 75.

The Information Commissioner’s Office (ICO) has updated its guidance on the processing of criminal offence data under the General Data Protection Regulation, Regulation (EU) 2016/679 (GDPR). The updated general guidance includes a link to new detailed guidance on certain aspects. See: LNB News 06/11/2020 13.

MLex: Deutsche Telekom, Orange, Vodafone and other telecoms companies and internet platforms may face revised EU rules aimed at protecting privacy and security over communication networks, as EU officials try to break a deadlock that has dragged on for almost four years. Germany, which is chairing meetings between the EU’s national governments in the second half of the year, will present a revised text that could pave the way for a general agreement by EU governments. See News Analysis: Germany seeks to break ePrivacy Regulation deadlock.



Financial crime and sanctions

The Council of the EU has published its conclusions on anti-money laundering and countering the financing of terrorism (AML/CFT), as approved by the Council in a written procedure ended on 5 November 2020. The Council sets out in detail its position on the establishment of an EU-level AML/CFT supervisor. See: LNB News 06/11/2020 48.

HMRC has announced that, following the conclusion of the technical consultation on the Fifth Money Laundering Directive (5MLD) and Trust Registration Service (TRS) on 21 February 2020, the Money Laundering and Terrorist Financing (Amendment) (EU Exit) Regulations 2020, SI 2020/991, have come into force partly on 6 October 2020. The proposed regulations were considered by the House of Commons European Statutory Instruments Committee and the House of Lords Secondary Legislation Scrutiny Committee before being laid before Parliament on 15 September 2020. See: LNB News 10/11/2020 29.

MLex: The Serious Fraud Office (SFO) is to take a ‘more proactive’ role in investigating corruption cases, using a mixture of human intelligence, technology and whistleblower reports, their intelligence chief has said. See News Analysis: SFO will take ‘proactive’ role in investigating corruption, intelligence chief says.

Law360, London: Outdated laws on corporate criminal liability face fresh scrutiny in an independent review beginning this week, a move that drew criticism from lawyers for further delaying long-promised reforms to make it easier to prosecute companies for fraud and economic crime offences. See News Analysis: UK inches toward corporate criminal liability law reform.

The Foreign, Commonwealth & Development Office has published new guidance to assist individuals in implementing and complying with the Cyber (Sanctions) (EU Exit) Regulations 2020, SI 2020/597, in line with the Sanctions and Anti-Money Laundering Act 2018, to help stakeholders prepare for the end of the transition period and beyond. Further new and updated guidance may be issued as the transition period progresses, so stakeholders are advised to monitor these pages for updates. See: LNB News 05/11/2020 57.

UK Finance has published a number of papers reviewing new UK sanctions regulations, as EU sanctions legislation and regulations will cease to have UK effect at the end of the Brexit transition period. The UK legislation is designed to replace the current EU-derived legislation, but it also allows the UK to finesse the regimes with language that was not possible via the EU legislation. The overall review of the UK legislation sets out areas where the requirements, language or general policy can cause interpretation to expand or contract. The review is supplemented by separate reviews of individual jurisdictional and thematic sanctions regimes. The reviews aim to provide a helpful resource for financial institutions and other firms with a responsibility to comply with UK sanctions legislation either in the UK or overseas. See: LNB News 06/11/2020 30 and LNB News 09/11/2020 46.



Coronavirus (COVID-19)

The Department for Business, Energy & Industrial Strategy and the Department for Digital, Culture, Media & Sport have updated the guidance on working safely during coronavirus (COVID-19) for various sectors. The guidance states that during the period of new restrictions in England (5 November to 2 December 2020) where staff can work from home, they must do so. The guidance also confirms that national restrictions supersede the contents of the individual guidance documents, in particular where the document refers to ‘local COVID alert levels’. See: LNB News 06/11/2020 56.

The Financial Conduct Authority (FCA) has published documents to its dedicated business interruption insurance website, to assist policyholders and other stakeholders understand the judgment of its test case in relation to non-damage business interruption claims, arising out of the coronavirus lockdown. See News Analysis: FCA business interruption test case—documentation for policyholders.

The Business, Energy and Industrial Strategy (BEIS) Committee has announced upcoming sessions on the subjects of the impact of coronavirus and the support measures available to businesses and workers on 17 November 2020, and on business preparedness for Brexit on 7 December 2020. In addition, BEIS is also to hold a series of online roundtables in order to hear the views of businesses on the government’s industrial strategy and how business is currently dealing with the impact of the coronavirus and Brexit preparations. Those interested in attending the first roundtable, which takes place on 19 November 2020, were encouraged to apply by 9 November 2020. See: LNB News 09/11/2020 60.



Commercial

Brexit

The Cabinet Office has published updated guidance on moving goods from Great Britain to Northern Ireland under the Northern Ireland Protocol to help stakeholders prepare for the end of the transition period. Further new and updated guidance may be issued as the transition period progresses, so stakeholders are advised to monitor these pages for updates. See: LNB News 11/11/2020 63.

The Cabinet Office has reissued its guidance on public sector procurement to help stakeholders prepare for the end of the transition period and beyond. Further new and updated guidance may be issued so stakeholders are advised to monitor these pages for updates. See: LNB News 10/11/2020 89.

The Department for International Trade (DIT) has published new guidance on trading with developing countries from 1 January 2021 to help stakeholders prepare for the end of the transition period and beyond. Further new and updated guidance may be issued as the transition period progresses, so stakeholders are advised to monitor these pages for updates. See: LNB News 10/11/2020 93.

The Department for Business, Energy & Industrial Strategy (BEIS) has published new guidance on placing manufactured goods on the market in Northern Ireland to help stakeholders prepare for the end of the transition period and beyond. BEIS has also updated previous guidance on placing manufactured goods on the market in Great Britain from 1 January 2021. Further new and updated guidance may be issued as the transition period progresses, so stakeholders are advised to monitor these pages for updates. See: LNB News 10/11/2020 94.

The Department for Environment, Food & Rural Affairs (Defra) has published updated guidance on food and drink businesses to help stakeholders prepare for the end of the transition period. Further new and updated guidance may be issued as the transition period progresses, so stakeholders are advised to monitor these pages for updates. See: LNB News 05/11/2020 74.



Coronavirus (COVID-19)

The government has published new guidance entitled ‘Closing certain businesses and venues in England’ as the country goes into its second coronavirus lockdown. The guidance sets out the restrictions placed on businesses and venues in England, which will remain in place until 2 December 2020. It includes information on which businesses are considered essential and therefore permitted to remain open, and which businesses and venues are subject to restrictions or closure. It also contains a number of sector-specific additional guidance on how to operate in a coronavirus-secure manner. See: LNB News 06/11/2020 57.



Contracts

In Totsa v New Stream the claimant applied for summary judgment on its claim for the repayment of money advanced to the defendant under a contract for the supply of goods. The defendant was unable to deliver the goods in question, asserting that this was as a result of a force majeure event, and that the repayment clause in question did not accordingly apply. For the purposes of the summary judgment application, it was assumed that a force majeure event had occurred, and valid notice given pursuant to the terms of the contract. The court held that, on a proper construction of the terms of the contract, the obligation was for the seller to repay the advance payment if the product was not delivered when due (subject to any extension) for any reason whatsoever. In particular, as a result of the broad and all-inclusive language of the repayment clause, the obligation to repay was not affected by any force majeure event, despite there being some cross-referencing between the force majeure clause and the repayment clause. In fact, the court held that the cross-referencing, if not completely surplusage, was demonstrating that it would be open to the parties to agree a different course if they so choose in light of a force majeure event occurring (understandable in light of such a stark and wide-ranging phrase as ‘if for any reason whatsoever…the product has not been delivered…’) but that they had not done so. Written by Georgia Whiting, barrister, 4 King’s Bench Walk. See News Analysis: The construction of force majeure clauses (Totsa v New Stream).

Damages in contract are intended to place the claimant in the same position as they would have been in if the contract had been performed. But how does the court differentiate between the ‘imaginary world’ in which ‘the contract is performed’ and the events which in fact took place? In Medsted v Canaccord, the court considered the scope of the appropriate counterfactual. The court held that contractual damages are not intended to put the claimant in the position they would have been in but for the breach of contract. Rather, they operate as a substitute for performance. The relevant counterfactual did not, in this case, reflect the likelihood that but for the breach, the level of trading under the contract would have been reduced. No discount on damages was therefore applied. Written by Harriet Campbell, professional support lawyer at Stephenson Harwood LLP. See News Analysis: Contractual losses and the relevant counterfactual (Medsted v Canaccord).

While unanimously expressing regret at the outcome, the Court of Appeal in Joseph v Deloitte declined to imply a term into a partnership contract which would have had the effect of extending the time for an equity partner to challenge a notice of retirement issued against him by the board. Written by Andrew Butler QC, barrister at Tanfield Chambers. See News Analysis: Contracts—construction—implied terms—estoppel (Joseph v Deloitte).



E-Commerce

The European Commission has opened a consultation to review the Web Accessibility Directive, seeking feedback on various topics, including the accessibility requirements set forth in the Directive and the added value of accessibility statements, the level of accessibility of PSB websites and mobile apps, the impact of the Directive on the availability of public online content among other things. The consultation closes on 8 December 2020. See: LNB News 11/11/2020 15.



Consumer protection

The Council of the EU has announced its position at the first reading on a draft directive on representative actions for the protection of the collective interests of consumers in the EU. The directive calls for Member States to set up a system of representative steps for the protection of consumers’ collective interests against infringements of Union law. The directive allows qualified entities that have been nominated by Member States to search for injunctions and/or redress, including compensation or replacement, for a group of consumers that have been harmed by a trader who has allegedly breached one of the EU legal acts outlined in the annex to the directive. The directive will apply to representative actions ‘brought on or after the date of its application’. The German Federal Minister of Justice and Consumer Protection, Christine Lambrecht said the ‘agreement paves the way for granting consumers throughout the EU the right to seek effective judicial protection collectively when traders harm consumers by violating EU laws.’ See: LNB News 05/11/2020 21.



Agency and distribution

The recent decision of the Privy Council in Ciban Management Corporation v Citco (BVI) Ltd considered the application of the Duomatic principle to a situation in which the ultimate beneficial owner is not the registered shareholder of the company concerned, but controls it from the shadows through an agent. It is, in many ways, a decision grounded in common sense given the facts, but it is backed up (at least as to the main decision) by both interesting and concise legal reasoning. It will no doubt be a decision which provides comfort to professional corporate services providers in offshore jurisdictions. Written by Hugh Miall and Steven Thompson QC (who acted for the successful Respondents), barristers at XXIV Chambers. See News Analysis: Secret shareholders, ostensible authority and the Duomatic principle in offshore corporate structures.



Supplier management

The government has launched a website providing guidance to support cutting-edge UK firms negotiating the ethical, legal and commercial questions they may experience in China or when working with Chinese businesses. The guidance details the main issues digital and technology companies should consider as they establish the benefits and risk of commercial ventures following demand from the sector. The guidance is in addition to the measures announced in June 2020 to boost digital trade. See: LNB News 06/11/2020 86.



Corporate

Company disclosures, records and registers

The government and UK regulators have published their joint interim report and roadmap detailing the UK’s approach to implementing the recommendations of the Taskforce on Climate-related Financial Disclosures (TCFD). The government is aiming to introduce fully mandatory climate-related financial disclosure requirements across the economy by 2025, with significant mandatory requirements in place by 2023. The report covers the reasons for mandatory TCFD aligned disclosures, the path towards mandatory TCFD-aligned disclosures, key considerations in developing the roadmap and next steps. See: LNB News 10/11/2020 62.



Directors

Restructuring & Insolvency analysis: Re Saint George Investment Holdings Ltd; Manolete Partners plc v Matta and others [2020] EWHC 2965 (Ch) concerned the first hearing of an application for repayment of a substantially overdrawn director’s loan account (DLA) and various preference payments and transactions at an undervalue (TUVs). The court held that a DLA overdrawn as a result of significant and prolonged expenditure, unrelated to the benefit of the company, placed a former director in breach of his duty to act in a way most likely to promote its success. It was no answer that at the time the company had been sufficiently financially robust to absorb such spending. As well as providing a useful reminder of the duties owed by directors to a company generally and in relation to the DLA specifically the court also reiterated helpful guidance on when office-holder claims are suitable for summary disposal. Written by Ben Channer, barrister at 3 Hare Court. See News Analysis: Directors beware—how not to use your loan account (Re Saint George Investment Holdings Ltd).



Information Law & TMT

Data protection

The EDPB has adopted its first dispute resolution decision on the basis of Article 65 of the GDPR, by a 2/3 majority of its members. The decision (the details of which have not yet been published) resolves a dispute concerning a draft decision issued by the Irish supervisory authority regarding Twitter. See: LNB News 10/11/2020 97.



Cybersecurity

The Department for Digital, Culture, Media & Sport (DCMS) has published its response to the call for views on proposed legislation to amend the Network and Information Systems Regulations 2018 (NIS Regulations), SI 2018/506. See: LNB News 10/11/2020 109.

In a related development, amendments are made to the NIS Regulations by the Network and Information Systems (Amendment and Transitional Provision etc) Regulations 2020, SI 2020/1245 to improve the efficacy and implementation of the NIS Regulations in the UK. These amendments are primarily based upon the recommendations made in the Post-Implementation Review of the NIS Regulations published in May 2020, as subsequently developed in light of evidence provided following the calls for views referred to above. The new Regulations come into force on 31 December 2020. See: LNB News 11/11/2020 10.

The European Union Agency for Cybersecurity (ENISA) has published its guidelines for securing the Internet of Things (IoT) supply chain. The guidelines detail the complete IoT supply chain, including hardware, software and services. The guidance is aimed to help IoT manufacturers, developers, integrators and all stakeholders that are involved in the supply chain of IoT to make greater security decisions when creating, deploying, or analysing IoT technologies. In addition, ENISA has also published an online tool that aims to give a combined view of ENISA’s good practices for IoT and smart infrastructure. See: LNB News 09/11/2020 85.



Employment

Coronavirus (COVID-19)

LexisNexis Employment explain and analyse the updates made by HMRC on 10 November 2020 to ten guidance documents relating to the Coronavirus Job Retention Scheme (CJRS) to take account of the extension of the CJRS to 31 March 2021. See News Analyses: Further updates made on 10 November to HMRC guidance on Coronavirus Job Retention Scheme and Analysis of 10 November updates to HMRC guidance on Coronavirus Job Retention Scheme.



Ending employment

The purpose of the Employment (Dismissal and Re-employment) (No. 2) Bill is to prohibit employers dismissing employees and subsequently re-employing them for the purpose of diminishing the terms and conditions of employment. The first reading in the House of Commons took place on 4 November 2020. The second reading is due to take place on 29 January 2021. See: LNB News 05/11/2020 44.



Additional news—daily and weekly news alerts

This document contains the highlights from the past week’s news. To receive all our news stories, whether on a daily or a weekly basis, amend your personal settings within your ‘News’ tab on the homepage by clicking on either ‘Email’ or ‘RSS’ (depending on how you prefer to receive them) on the right hand side of the blue banner.



New and updated content

New and updated content—Risk & Compliance

Practice Note: What’s new and what’s changed in 2020—Risk & Compliance contains a summary of substantive changes to Risk & Compliance content.

Updated Practice Notes:

● Brexit legislation tracker

● Coronavirus (COVID-19)—employment data protection issues

● Coronavirus (COVID-19)—safe working in an office environment

● Criminal records—asking questions, DBS checks and data protection

● Sanctions regimes made under SAMLA 2018—tracker

● Sanctions regime—cyber-attacks

Updated Precedents:

● Coronavirus (COVID-19) workplace risk assessment and plan—offices

● Response to data subject request—all rights—charging a fee or extension of time to respond

Updated Checklist: Coronavirus (COVID-19)—safe working in an office environment—checklist.

New Q&As:

● What are section 702 of FISA and EO 12333 in the context of data protection and governmental surveillance?

● What makes a data subject access request ‘complex’?



New and updated content—Commercial

New Practice Note: What does IP completion day mean for distribution?

Updated Practice Note: Brexit legislation tracker

New Q&As:

● Is there a legal requirement for a contracting authority to terminate an existing public contract where the supplier under that contract is participating in a subsequent public procurement process tendered by the same authority?

● Would a non-solicitation clause in a commercial contract survive if it isn’t expressly stated to survive termination or expiry but where there is a clear continuing rights section in the contract?



New and updated content—Corporate

New Q&As:

● Where the functional currency (ie the currency of the accounts) of a company is in Euros and its share capital is denominated in pounds sterling, how would this difference be reconciled for the purpose of resolving on a dividend?

● How do you file documents (specifically an order sanctioning a new Corporate Insolvency and Governance Act 2020 restructuring plan, see section 901F(6)(b) Companies Act 2006) at Companies House during the coronavirus (COVID-19) pandemic if the London office of Companies House is closed?

● How might a director be relieved of liability under section 1157 of the Companies Act 2006?

To view analysis of the latest deals in the market and the underlying transaction documents, use our Market Tracker deal analysis tool.



New and updated content—Information Law & TMT

New Practice Notes:

● The Data Protection Act 2018 and the UK GDPR

● What does IP completion day mean for contracts?

Updated Precedent: Data processing side agreement—personal data only—pro-controller



New and updated content—Employment

New Practice Note: Working remotely outside the UK—considerations for UK employers.



Dates for your diary

Time

Event

Subjects Covered

18 November 2020

Webinar—TMT

Autonomous vehicles (2020)

30 November 2020

Webinar—Commercial Law

Commercial law—end of year round-up 2020

8 December 2020

Webinar—In-house Counsel

Succession planning

14 December 2020

Webinar—TMT

The European Electronic Communication Code (2020)

31 December 2020

Webinar—In-house Counsel

Dealing with conflicts of interest within your organisation

31 December 2020

Webinar—Commercial Law

Recent developments in commercial contracts (2020)

On demand

Webinar—TMT

FinTech (2020)

On demand

Webinar—TMT

Cloud computing (2020)

On demand

Webinar—TMT

Drones law (2020)

On demand

Webinar—TMT

Influencers and intellectual property (2020)

On demand

Webinar—TMT

(Brief) The Copyright Directive (2020)




Useful information

Contact us

Please follow us on Twitter at @inhouse_leaders. You can also keep updated by reading our blog. If you need an overview of the materials in the in-house module, see: In-house—introduction to our materials.


 

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About the author:
Allison is a former partner of Shoosmiths, with extensive experience of legal management and practice compliance.