Shearman And Sterling

Shearman & Sterling is firmly committed to helping clients achieve their business objectives. With a focus on our clients’ changing needs and goals, we deliver a wide range of materials and services to keep them up to date and informed.

Perspective

The SBA’s Paycheck Protection Program—Revenue Reduction Calculations Guidance Released

Jan 22, 2021

On January 19, 2021 the Small Business Administration (SBA) issued frequently asked questions that address how to calculate revenue reduction and maximum loan amounts for second-draw Paycheck Protection Program (PPP) loans.

Perspective

Banking Under Biden

Jan 21, 2021

The 2020 Election Results and Implications for the Financial Services Industry.
Former Vice President Joseph R. Biden Jr. has won the 2020 presidential election and the Democratic Party will remain in control of the House of Representatives. Though it is yet uncertain whether President-elect Biden and the Democratic Party will win the ability to propose and pass wide-sweeping legislation, President-elect Biden will have the opportunity to pursue financial services regulatory and supervisory reform through agency appointments and rulemaking. This presentation highlights key potential personnel changes at the federal financial regulatory agencies and provides our view of how the financial services regulatory landscape may change in a Biden presidency.

Perspective

New Final Regulations Issued Under Section 1061 Make Significant Changes Impacting 3-year Holding Period on Carried Interests

Jan 19, 2021

On January 7, 2021, the Internal Revenue Service (the IRS) and the U.S. Department of the Treasury (“Treasury”) issued final regulations (T.D. 9945) addressing circumstances under which net long-term gains will be recharacterized as short-term capital gains with respect to certain partnership interests (the “Final Regulations”). The Final Regulations provide guidance under Section 1061 of the Internal Revenue Code (the “Code”)[1] and finalize certain provisions of the proposed regulations (REG-107213-18) issued on July 31, 2020 (the “Proposed Regulations”), as summarized in our previous client publication, “IRS Proposes Carried Interest Rules Recharacterizing Certain Capital Gain in Connection with Profits Interests.”

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UK Supreme Court Confirms Scope of Insurance Coverage for COVID-19 Business Interruption Losses

Jan 19, 2021

In a significant test case brought by the U.K.’s Financial Conduct Authority, the Supreme Court confirms business interruption insurance coverage for losses arising from COVID-19.

Perspective

Implementation Date for ISDA IBOR Fallbacks Protocol Approaches

Jan 19, 2021

Following many months of consultation, on January 25, 2021, ISDA’s IBOR Fallbacks Protocol and related Supplement to the 2006 ISDA Definitions, which together provide fallbacks for LIBOR and other interbank offered rates (IBORs), will take effect. Pursuant to Supplement number 70 to the 2006 ISDA Definitions (the Supplement), all transactions incorporating the 2006 ISDA Definitions that are entered into on or after this date will incorporate the new IBOR fallbacks, unless the parties specifically exclude them. The ISDA IBOR Fallbacks Protocol (the Protocol) will incorporate the new IBOR fallbacks into existing (legacy) derivatives agreements between adhering parties.

Perspective

Looking Back and Looking Forward: Corporate Governance and M&A in 2020 and 2021

Jan 15, 2021

Global Managing Partner George Casey authored an article titled “M&A: Looking Back And Looking Forward.”

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2021 Proxy Season Quick Reference Guide

Jan 13, 2021

The 2021 proxy season is just around the corner. This quick reference guide, which is intended to supplement Shearman & Sterling’s 18th Annual Corporate Governance & Compensation Survey, summarizes themes from the 2020 proxy season and developing trends to consider for 2021. It also identifies possible future changes in disclosure rules that U.S. public companies should consider for the upcoming proxy season.

Perspective

IRS Issues Final Regulations for Applying UBTI ‘Silo’ Rules to Tax-Exempt Organizations

Jan 13, 2021

On November 30, 2020, the U.S. Department of Treasury (“Treasury”) and the IRS issued final regulations (T.D. 9933) on how an exempt organization determines if it has more than one unrelated trade or business, and, if so, how the exempt organization calculates its unrelated business taxable income (the “Final Regulations”). The Final Regulations address guidance under Section 512(a)(6) of the Internal Revenue Code of 1986, as amended (the “Code”) and largely adopt proposed regulations (REG-106864-18) issued in April 2020 (the “Proposed Regulations”), as summarized in our previous publication titled “Proposed Regulations Clarify UBTI ‘Silo’ Rules, Preserve Relief for Tax-Exempt Investments in Private Equity Funds.

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It Is Annual Report Time—Recent Developments and Trends for the Preparation of Form 20-F

Jan 12, 2021

It is now time for foreign private issuers (FPIs) to prepare their annual reports on Form 20-F. For companies with a calendar year-end, the Form 20-F must be filed with the U.S. Securities and Exchange Commission (the SEC) by April 30, 2021. To help you with the preparation of this filing, consider the following recent developments, trends and topics that may be areas of focus of the SEC during the 2021 review process.