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11 Jul 2013
Shearman & Sterling has advised ICE Clear Europe on the transition of clearing of the NYSE Liffe London derivatives market from NYSE Liffe and LCH.Clearnet Ltd to ICE Clear Europe. The transition involved the novation of 75 million cleared derivatives contracts to which 43 clearing member firms were party. ICE Clear Europe is now clearing 6 new derivative product classes, comprising over 1300 products settled in 10 new currencies. Approximately $11.17 billion of mixed asset collateral was transferred to ICE Clear Europe. New cash and securities settlement arrangements were established in multiple jurisdictions.
Shearman & Sterling advised on ICE’s clearing services agreement with LIFFE, the transition and novation documentation with LCH.Clearnet and LIFFE, new banking and settlement arrangements, amendments to the ICE Clear Europe and LIFFE rulebooks, tax exemptions in the UK and Ireland and regulatory approval and exemption processes in the US and UK. Lawyers from Shearman & Sterling’s London, other European and New York offices worked together to establish the legal basis for these new arrangements. All this was achieved on a tight timeline, since the new arrangements were agreed upon in principle only in December 2012.
“Our longstanding relationship with ICE and the breadth of our English law and US regulatory experience has been mutually beneficial. We have been able to assist ICE Clear Europe with its strategically important developments from the time it was first set up,” said Barney Reynolds, global head of Shearman & Sterling’s Financial Institutions Advisory & Financial Regulatory practice. Shearman & Sterling helped establish ICE Clear Europe as the first derivatives clearing House in London in over 100 years, including advising on the complex transition of clearing arrangements from LCH.Clearnet to ICE Clear Europe.
The Shearman & Sterling team includes partners Thomas Donegan and Barney Reynolds, (London–Financial Institutions Advisory & Financial Regulatory), Russell Sacks (New York–Financial Institutions Advisory & Financial Regulatory), Geoffrey Goldman (New York-Derivatives and Financial Institutions Advisory & Financial Regulatory), Iain Scoon (London–Tax), Ian Harvey-Samuel and Julian Tucker (London–Structured Finance and Derivatives), Winfried Carli (Frankfurt–Finance) and Herve Letreguilly (Paris–Corporate); counsel Azad Ali (London-Financial Institutions Advisory & Financial Regulatory), Sam Whitaker (London-Executive Compensation & Employee Benefits), and Simon Letherman (London–Tax), consultant Mark Robinson (London–Intellectual Property); associates Aatif Ahmad, Mak Judge, Ellie Teo, James Campbell (London-Financial Institutions Advisory & Financial Regulatory), Jack Prytherch (London–Tax), Severine De La Courtie (Paris–Corporate), and Matthias Weissinger (Frankfurt–Finance); and trainees Natalie Caldwell and Louise Benski.