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Structured trade finance

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Structured trade
finance



Worldwide offices of Lovells:
Alicante Amsterdam Beijing Berlin Brussels Chicago Dusseldorf Frankfurt Hamburg Ho Chi Minh City Hong Kong London
Milan Moscow Munich New York Paris Prague Rome Singapore Tokyo Warsaw Washington DC
Associated offices: Budapest Vienna Zagreb
Contents




                                        Lovells Lee & Lee
                                 Page

      Structured trade finance     1

      How can we help              3

      Our approach                 5

      Our experience               6

      Lovells Lee & Lee            8

      Lovells                      9

      Lee & Lee                   10

      Contacts                    11
Structured trade finance




                                                                            Lovells Lee & Lee
The increasing globalisation of our practice is reflected in its
structured trade finance work. Our depth of experience,
available through offices in key jurisdictions around the world,
enables us to provide comprehensive advice on all aspects of
international trade and commodity financing transactions.


              We have access to an extensive international network of
              offices, supplemented by longstanding links with
              leading firms of local lawyers. Our specialist lawyers
              appreciate the need to provide accurate, cost-effective
              legal advice, which takes account of the commercial
              realities of the transaction. As a result of our
              experience, clients are not paying for us to gain expertise
              in the often complex legal structures involved in trade
              finance transactions. In this way, we meet the needs of
              clients wherever they conduct business.

              This enables us to advise clients on all aspects of
              structured trade financing including:

              • pre-export financing

              • prepayment financing

              • warehouse financing

              • limited recourse funding

              • dispute resolution

              • price protection strategies.




                                -1-
                    As part of this, we negotiate and document a range of
Lovells Lee & Lee



                    transactions including:

                    • bilateral and syndicated loan facilities on behalf of
                      banks and other financial institutions

                    • prepayment supplements on behalf of lenders and
                      trading houses

                    • security and other credit support documents in both
                      bilateral and syndicated structures.

                    Our experience and depth of practice enables us to
                    develop innovative solutions to issues arising in structured
                    trade finance transactions, whether acting for lenders,
                    producers or trading houses.




                                      -2-
How we can help




                                                                            Lovells Lee & Lee
We can provide advice and support at all stages of a
transaction. In all cases, however, a comprehensive analysis
of the aims of the parties and the legal risks involved is
essential to developing the appropriate legal approach to the
needs of our clients.


              This understanding of the fundamentals driving the
              transaction enables us to develop legal structures to meet
              those needs. Having established the legal structure, we
              then discuss with clients the most appropriate way to
              implement those structures in the jurisdictions concerned.

              For example, commodity producers and traders can
              benefit from warehouse financing to finance goods that
              are awaiting shipment. This involves a careful analysis of
              the legal status of the warehouse in the jurisdiction in
              which it is located and the appropriate mechanisms for
              taking security over the goods stored there.

              Producers may need the financing at a much earlier stage
              in the production cycle to finance inputs of raw material
              and labour and the cost of developing and maintaining the
              production infrastructure. A pre-export facility providing
              loans direct to the producer, or a prepayment facility
              where funds are provided by way of prepayment under an
              export contract, can provide a valuable source of funding.
              However, the legal risk associated with each structure must
              be analysed carefully. Traders involved in prepayment
              financing are becoming more aware of their potential
              liabilities under these structures and limited recourse
              financing is becoming increasingly attractive to them.

                               -3-
                    The practical difficulties of enforcing rights under the
Lovells Lee & Lee



                    documents must also be borne in mind and our extensive
                    experience of international transactions enables us, in
                    conjunction with relevant local counsel, to assist parties in
                    evaluating their risks as well as their potential rewards.

                    Lovells' network of offices means that we have lawyers
                    familiar with a range of legal systems both common law
                    and civil code based. For example, Lovells' Paris office
                    has experience of transactions across Francophone Africa.

                    In addition to the specialist trade finance advice we
                    provide, we can also draw on the full range of services
                    provided by Lovells and Lee & Lee, whether through our
                    joint venture or working in conjunction with specialist
                    departments. This includes advice on taxation, corporate
                    recovery and restructuring, insurance and re-insurance,
                    litigation and debt recovery.




                                      -4-
Our approach




                                                                          Lovells Lee & Lee
We consider it essential that we function as part of a team
with our clients and their other professional advisers. This
approach of co-operation and pragmatism produces
commercially-minded advice focused on providing solutions
and exploring opportunities.


             Central to this is a full understanding of the business
             objectives of our clients coupled with a knowledge of the
             commercial environment in which our clients and their
             customers operate. By providing a range of alternatives,
             we produce flexible solutions and options that enable
             clients to choose the approach that best fits their own
             requirements. We provide expert legal advice and
             coherent, comprehensive documentation, applicable to the
             commercial realities of the transaction.

             We appreciate the need to provide cost-effective
             solutions and achieve this by involving staff with a blend
             of skill levels and experience appropriate to the
             transaction. A team under the leadership of a partner is
             provided for each transaction according to the needs of
             that transaction and the client. The core team is also
             responsible for co-ordinating the contributions of
             specialist lawyers from relevant departments around
             Lovells and Lee & Lee. The client has direct access to
             partners and other members of the team at all times.

             We appreciate the importance of building long-term
             relationships with our clients and that the composition
             of a transaction team is as important as the reputation
             of the firm itself.

                              -5-
                    Our experience
Lovells Lee & Lee




                    We act for a range of clients based in business centres around
                    the world. They include lenders, major trading houses and
                    producers. Our geographical experience includes metal
                    exports from Africa, syndicated oil prefinancings in Russia
                    and the Middle East and soft commodity financing in South
                    America. We have also been involved in Sharî'ah financing, to
                    which structured trade finance transactions are well suited.


                                 This has given us experience of the commercial issues,
                                 risks and expectations involved in trade finance and the
                                 steps needed to allocate those risks between the parties.

                                 Our work has included bilateral and syndicated lendings
                                 and prepayment structures involving trading houses and
                                 special purpose vehicle companies. The use of special
                                 purpose vehicle companies can provide a useful mechanism
                                 for dealing with balance sheet and regulatory issues which
                                 might otherwise prevent the transaction proceeding.

                                 Trade finance has traditionally involved a significant
                                 amount of paperwork which has to be prepared,
                                 transported and verified at various stages in the
                                 transaction. New technologies provide an opportunity to
                                 reduce this. Our experience with Internet based
                                 electronic trading systems and electronic data interchange
                                 systems such as bolero.net enables us to provide up-to-
                                 date advice to clients on this increasingly important area.




                                                  -6-
                                                              Lovells Lee & Lee
Our experience includes:

• acting for agents, arrangers and banks in syndicated pre-
  shipment facilities for oil producers in Algeria, Angola,
  Cameroon, Cuba, Ghana, the Middle East and Russia

• acting for international banks on the financing of
  metals exports from Brazil, Mongolia, Russia and
  Zambia

• acting for lenders on the financing of sugar exports
  and imports in Brazil, Cuba, Indonesia, Jamaica and
  the Philippines

• acting for multi-lateral institutions making facilities
  available to local banks in Ghana and Nigeria

• advising trading houses on financing arrangements
  in various countries including Byelorussia, Latvia
  and Taiwan

• developing security structures in relation to receivables
  and tax revenues as well as underlying commodities.




                 -7-
                    Lovells Lee & Lee
Lovells Lee & Lee




                    Lovells Lee & Lee, formed on 1 March 2001, is a joint law
                    venture corporation between one of the largest international
                    law firms Lovells and leading Singapore law firm Lee & Lee.


                                  Combining the legal skills and experience of both firms,
                                  our joint aim is to provide clear and concise advice based
                                  on in-depth knowledge of the legal, regulatory and
                                  commercial environments within which our clients
                                  operate and a comprehensive understanding of their
                                  overall business objectives.

                                  Lovells Lee & Lee services the demands of multi-national
                                  corporate and financial clients, the core of our client base
                                  in Asia, who see the region as a single market and expect
                                  their legal advisers to structure and manage transactions
                                  on a pan-Asian basis. The joint venture manages all legal
                                  aspects of transactions which require either international
                                  or local law input, or a mixture of both.




                                                    -8-
Lovells




                                                                            Lovells Lee & Lee
Lovells is a leading global law firm, with over 300 partners,
1,500 lawyers and a total of around 3,000 people across 26
offices in Europe, Asia and North America.


              Lovells combines the expertise of two leading practices -
              formerly Lovell White Durrant in the UK, continental
              Europe, the USA and Asia and Boesebeck Droste with
              offices in the major financial and commercial centres in
              Germany, Spain and key Central European countries.
              From 1 May 2001 Lovells merged with the highly
              regarded Dutch firm Ekelmans Den Hollander. In
              November 2001, Lovells and Siméon and Associes
              merged. It was one of the first mergers between an
              international law firm and a French firm. Building upon
              strong and broadly based domestic practices, we provide
              co-ordinated multi-jurisdictional services from our offices
              around the world.

              Lovells has been involved in the Asian market for over
              two decades and is now one of the largest full service
              international law firms in the region, with around 100
              lawyers and 200 staff in total working from offices in
              Beijing, Hong Kong, Ho Chi Minh City, Singapore and
              Tokyo and from our operations in Bangkok and Shanghai.

              The firm provides a full range of business law services,
              with particular emphasis on all aspects of corporate and
              financial legal work.

              www.lovells.com



                                -9-
                    Lee & Lee
Lovells Lee & Lee




                    Lee & Lee is one of Singapore's largest and best known law
                    firms. It is a full service law firm and provides a
                    comprehensive range of legal services to domestic and
                    international clients. Its areas of practice include corporate,
                    banking, construction and engineering, project finance,
                    environmental, conveyancing, real estate, commercial and
                    residential leases, immigration, commercial litigation,
                    arbitration, mediation, telecommunications, computer,
                    information technology and intellectual property law.


                                  The firm has an illustrious history. It was founded in
                                  1955 by Lee Kuan Yew, Lee Kim Yew and Kwa Geok
                                  Choo. It has now more than 90 lawyers with two offices
                                  in Singapore in the Shenton Way and Suntec City business
                                  districts. These offices house the firm's corporate and
                                  banking, conveyancing and property, litigation, and
                                  information technology and intellectual property
                                  departments and the various practice groups of the firm.

                                  Leading-edge technology is fully employed giving the firm's
                                  lawyers instant access to legal research tools and databases.
                                  The firm's aim is to provide comprehensive, thorough and
                                  innovative legal advice on all aspects of local law.

                                  www.leenlee.com.sg




                                                   - 10 -
                                                                           Lovells Lee & Lee
Contacts


For further information on our services, please refer to our
website at www.lovellsleenlee.com or contact any of the
following or the person with whom you usually deal:



LOVELLS LEE & LEE

Andrew Ang                              Paul Oldman
Direct tel +65 6557 4803                Direct tel +65 6557 4504
andrewang@lovellsleenlee.com            paul.oldman@lovellsleenlee.com

Susan Wong                              Andrew Taylor
Direct tel +65 6332 0336                Direct tel +65 6557 4507
susanwong@lovellsleenlee.com            andrew.taylor@lovellsleenlee.com

Marian Sng
Direct tel +65 6332 0334
mariansng@lovellsleenlee.com

LOVELLS WORLDWIDE

EUROPE

Amsterdam                               Berlin
John Gilbert                            Thomas Lindemann
john.gilbert@lovells.com                thomas.lindemann@lovells.com

Frankfurt                               London
Andrew Gamble                           David Lacey
andrew.gamble@lovells.com               david.lacey@lovells.com

Milan                                   Moscow
Paolo Criscione                         Larry George
paolo.criscione@lovells.com             larry.george@lovells.com


                               - 11 -
Lovells Lee & Lee




                    Paris                                Rome
                    Richard Jadot                        Alessandro Napolitano
                    richard.jadot@lovells.com            alessandro.napolitano@lovells.com

                    Warsaw
                    Jolanta Nowakowska-Zimoch
                    jolanta.nowakowska-
                    zimoch@lovells.com

                    NORTH AMERICA

                    New York
                    Gary Lee
                    gary.lee@lovells.com

                    FAR EAST

                    Hong Kong                            Tokyo
                    John Hartley                         Michael Hancock
                    john.hartley@lovells.com             michael.hancock@lovells.com




                    March 2002




                                                - 12 -

				
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