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    Jun. 25, 2020

How to Facilitate a Privacy Compliant Return to Work: Policies and Protocols (Part Two of Three)

Balancing health and safety concerns with privacy considerations after the coronavirus pandemic can be overwhelming for a fund manager when bringing its workforce back into the office. This second article in our three-part series outlines how to facilitate a privacy compliant return to work, and it provides practical advice from various in-house and outside privacy counsel on protocols for identifying and responding to symptomatic or sick employees. The article also includes six considerations to assist fund managers with developing a privacy compliant policy. The first article examined the relevant laws and guidance; ways fund managers can balance competing interests of safety and privacy; and anticipated U.S. regulatory considerations. The third article will focus on contact tracing and considerations for deciding if, and in what form, it is appropriate for a fund manager. See “How Fund Managers Can Withstand the Coronavirus Pandemic: Marketing Disruptions, Key Person Clauses and Cybersecurity Concerns (Part Two of Three)” (Apr. 9, 2020).

Current Tax Challenges for Funds With European Investments

Many investment funds with international investment strategies have existing European investment platforms or some European infrastructure to facilitate E.U. investments. Many of those funds have spent significant time over the last few years evaluating those structures in light of treaty benefits and increased economic substance requirements, among other things. In connection with those evaluations, and to ensure that appropriate tax benefits continue to be available, many fund managers already have a clear understanding of the Organisation for Economic Cooperation and Development’s Base Erosion Profit Shifting initiative and related tax concepts. Developments in both national and international law, however, indicate that now is an appropriate time to further examine existing and future cross-border structuring, particularly in light of the introduction of the Multilateral Convention to Implement Tax Treaty Related Measures to Prevent Base Erosion and Profit Shifting (MLI). In a guest article, Will Smith, partner at White & Case, analyzes one key aspect of the MLI; market uncertainty arising from recent case law; the impact of the so‑called “Dutch cases”; and the implications for investment funds. For additional commentary from Smith, see “Practical Tax Considerations Arising From Trends in European Fund Structuring” (Jun. 13, 2019); and “Tax Developments May Make U.K. Limited Companies More Favorable Than U.K. LLPs for U.S. Fund Managers” (Apr. 20, 2017).

ESG Considerations for Fund Managers: The U.S. Landscape (Part One of Two)

Demand for investments that take into account environmental, social and governance (ESG) factors continues to grow. A recent Dechert program took a deep dive into the most pressing issues that fund managers interested in pursuing ESG strategies are likely to face. The program featured partners Julien Bourgeois; Anthony S. Kelly, who was the former Co‑Chief of the Asset Management Unit of the SEC’s Division of Enforcement; Andrew L. Oringer; Mark D. Perlow; and Mikhaelle Schiappacasse. This article, the first in a two-part series, explores the key insights from the program on ESG in the U.S. regulatory landscape, including issues unique to ERISA fiduciaries, private funds, managed accounts and registered funds; SEC examination and enforcement focus; and strategies for ensuring compliance when embracing ESG. The second article will address E.U and global ESG developments, including E.U. and global leadership; disclosure, taxonomy and low-carbon benchmarks regulations; and other E.U. initiatives. See “IFI Global Panel: ESG Will Fundamentally Transform Investing in the Coming Decade” (Mar. 12, 2020).

Symposium Examines the State of the Cryptocurrency Market (Part One of Two)

The cryptocurrency industry faces many of the same legal and operational issues as digital asset fund managers in today’s climate. The recent CoinAlts Fund Symposium provided a comprehensive overview of the state of the cryptocurrency industry, as well as the hurdles that market participants must overcome. The program featured Lewis Chong, partner at Harneys; Bart Mallon, partner at Cole‑Frieman & Mallon; Cynthia M. Pedersen, director at Cohen & Company; Matt Perona, chief operating officer and chief financial officer at Polychain Capital; and Matthew Stover and Seth Altman, CEO and director, respectively, at MG Stover & Co. This two-part series distills the primary points presented during the symposium. This first article reviews current U.S. taxation of cryptocurrency and proposed U.S. legislation. The second article will highlight offshore legal and regulatory considerations, as well as provide a summary of the current state of the cryptocurrency market. For more from Cole‑Frieman & Mallon and MG Stover & Co. professionals, see “Best Practices for Funds That Invest in Digital Assets” (Feb. 21, 2019).

Navigating Prime Brokerage Agreements, Swaps and Repos During the Coronavirus Crisis (Part Two of Two)

Two recent programs delved into the issues that fund managers may face in times of financial stress under counterparty agreements. The programs also offered guidance on preparing for and managing those issues during the coronavirus pandemic. The first program featured K&L Gates partners Barry B. Cosgrave, Kenneth Holston, Brian D. Koosed and Anthony R.G. Nolan, as well as counsel Robert T. Honeywell. The second, sponsored by Women in Funds and Kleinberg Kaplan, featured Kleinberg Kaplan partners Jared R. Gianatasio and Mary Kuan. This two-part series presents the key takeaways from those two presentations. This second article explains swaps and repurchase agreements, and it provides guidance on how fund managers can manage those agreements in times of crisis. The first article discussed counterparty trading relationships generally during the coronavirus pandemic and provided a specific look at how to navigate relations with prime brokers. See our two-part series “A Fund Manager’s Guide to the Initial Margin Rules for Uncleared Swaps”: Part One (Sep. 27, 2018); and Part Two (Oct. 4, 2018). See also “Best Practices for Fund Managers When Entering Into ISDAs: Negotiation Process and Tactics (Part One of Three)” (Jan. 12, 2017).

Kevin Bettsteller Joins DLA Piper in L.A.

DLA Piper announced that Kevin Bettsteller has joined the firm’s finance practice as a partner in Los Angeles. Bettsteller’s practice focuses on representing financial services companies, such as hedge, private equity, real estate and credit fund sponsors and other investment advisers; registered investment companies, business development companies and their independent directors; and broker-dealers. For another recent addition to the firm, see “DLA Piper Expands Boston Office with Addition of Litigator Jonathan Sablone” (Jan. 9, 2020).

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