Shepherd and Wedderburn
11 Experts
4 Contributions by Shepherd and Wedderburn
PRACTICE NOTES
Loan market and developments Overview
Broadly, Scotland’s loan market mirrors that of England. Financial services regulation operates on a UK‑wide basis; a substantial body of legislation governing companies and other corporate vehicles (including corporate insolvency) likewise applies across the UK; and all Scottish clearing banks conduct business in every UK jurisdiction, as do their counterparts across the UK. In practical terms, this means English law governed loan documents typically require minimal amendment for UK cross‑border lending transactions. There are, however, some differences in terminology and certain statutory variations that must be allowed for; beyond those matters, an English law loan document and a Scots law loan document are closely aligned. It is commonplace, for example, for English law loan agreements to be deployed in Scottish lending transactions. The principal divergences between the jurisdictions arise in relation to property law and to the law
Banking & Finance
PRACTICE NOTES
STOP PRESS
The Economic Crime and Corporate Transparency Act 2023 (ECCTA 2023) obtained Royal Assent on 26 October 2023. Part 1 of ECCTA 2023 comprises a significant suite of measures that bolster the function of Companies House and increase the transparency of UK corporate entities, furthering the openness of UK corporate bodies. The ECCTA 2023’s provisions will be introduced gradually over time, over an extended period. Numerous elements of the statute depend on detailed secondary legislation and guidance, alongside the development of fresh technical systems and tools to deliver the changes.
For further details, see Practice Notes: The Economic Crime and Corporate Transparency Act 2023—what Banking & Finance lawyers need to know and The Economic Crime and Corporate Transparency Act 2023—tracker.
This Practice Note draws out the practical distinctions between legal entities in Scotland and those in England and Wales. It also addresses the legal
Banking & Finance
PRACTICE NOTES
This Practice Note reviews the law on registering security created on or after 6 April 2013 by a company or limited liability partnership (LLP) registered in Scotland. The framework is set out in Part 25 of the Companies Act 2006 (CA 2006), given effect by the Companies Act 2006 (Amendment of Part 25) Regulations 2013, SI 2013/600 (for companies) and the Limited Liability Partnerships (Application of Companies Act 2006) (Amendment) Regulations 2013, SI 2013/618 (for LLPs). It highlights where Scots law departs from the law of England and Wales, namely:
registrable charges under Scots law
forms required to register security at Companies House
the date on which a registrable security is created
deeds of alteration needing registration (such as ranking agreements and intercreditor agreements)
enforcement of
Banking & Finance
PRACTICE NOTES
Types of security
Under Scots law, the range of security interests is narrower than those available in English law. The form of protection depends on the particular class of asset being charged. This Practice Note reviews the securities obtainable over particular asset types before addressing the floating charge, a form of security that may be created by Scottish companies or limited liability partnerships.
Fixed security
Land and buildings
The recognised fixed security over real estate assets in Scotland, available to both individuals and companies, is the standard security. A standard security may be granted over an interest in land that is recorded or registered in the General Register of Sasines or the Land Register of Scotland. Note the General Register of Sasines ceased to accept, among other matters, recording of new standard securities from 1 April 2016. From that day, a borrower granting security over a
Banking & Finance
27 Contributions by Shepherd and Wedderburn Experts
PRECEDENTS
1 Definitions and interpretation
1.1 Within this Agreement:
Affiliate – refers to any entity that, whether directly or indirectly, Controls, is Controlled by, or is under shared Control with, another entity;
Business Day – means any day other than a Saturday, Sunday, or a bank or public holiday in Scotland;
Control – signifies [ the beneficial ownership of more than 50% of a company’s issued share capital, or the lawful power to direct, or to cause the direction of, the company’s management OR has the meaning assigned in the Corporation Tax Act 2010, s 1124 ], and Controls and Controlled shall be construed accordingly;
Dispute Notice – has the meaning set out in clause 2.2;
Force Majeure – has the meaning set out in clause 6.1...
Commercial
PRECEDENTS
Subscribed for and on behalf of [ insert name of the Firm ]
Executed by ________________________ [ Director OR Secretary OR Authorised Signatory ], representing [ insert name of corporate partner ] as Partner. Signature ________________________ Full name of signatory ________________________ at ________________________ (city) on ________________________ (date of signing)...
Commercial
PRECEDENTS
Subscribed by
Signed by [ insert name of individual ] as [ General Partner OR Authorised Signatory ] for and on behalf of [ insert name of limited partnership ] ________________________ [ General Partner OR Authorised Signatory ] (Signature) at______________________ (city) on______________________ (date of signing) before ______________________ Witness (Signature) ______________________ Witness Name (Please Print) ______________________ Witness Address _______________________...
Commercial
PRECEDENTS
Option 1—self-proving execution by one corporate director or secretary in the presence of a witness
Signed duly on behalf of [ Name of Company ] by ________________________ [ Director OR Secretary OR Authorised Signatory ] acting for and on behalf of [ insert name of corporate director...
Commercial
PRECEDENTS
Option 1—self-proving execution by a corporate member signing on behalf of a limited liability partnership in the presence of a witness
Executed for and on behalf of [ insert name of LLP ] by ________________________ [ Director OR Secretary OR Authorised Signatory ] acting for [ insert name of corporate member ], as Member
(Signature) ________________________
Full name of signatory (please print) ________________________
City ________________________
Date of signing ________________________
Before ________________________ Witness
Witness (Signature) ________________________
Witness Name (Please Print) ________________________
Witness Address ________________________
Option 2—self-proving execution by two corporate members signing on behalf of a limited liability partnership in the presence of a witness
Executed for and on behalf of [ insert name of LLP ] by
Commercial
PRECEDENTS
Subscribed for and on behalf of [ insert name of limited partnership ]
[ Director OR Secretary OR Authorised Signatory ], acting for and on behalf of [ insert name of corporate partner ], as General Partner (Signature) ________________________
Full Name of signatory (Please Print) ________________________
Signed at ______________________ (city) on ______________________ (date of signing) in the presence of ______________________
Witness (Signature) ______________________
Witness Name (Please Print) ______________________
Witness Address _______________________
...
Commercial
PRECEDENTS
Signed for and on behalf of [ insert name of the Firm ] by ________________________ [ Director OR Secretary OR Authorised Signatory ] for and on behalf of [ insert name of corporate partner ], as Partner (Signature) ________________________ Full Name of signatory (Please Print) at______________________ (city) on______________________ (date of signing) before ______________________ Witness (Signature) ______________________ Witness Name (Please Print) ______________________ Witness Address _______________________...
Commercial
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