Exposure meaning

ARCHIVED This Checklist has been archived and is no longer maintained. It offers guidance on evaluating the potential contractual risks an individual business may face as a result of Brexit, and on conducting a Brexit risk management contract audit in readiness for Brexit before IP completion day. For information on the effect of IP completion day on contracts and, more widely, on commercial law, see Practice Notes: What does IP completion day mean for contract clauses? and What does IP completion day mean for Commercial? This Checklist explains how to assess contractual exposure for a particular business stemming from Brexit, and how to perform a Brexit risk management contract audit. It covers the need to establish a Brexit team, the issues that arise in a business unit audit and a contract audit, and points to consider during contract review. For deeper analysis, see Practice Note: Brexit—contract risk management [Archived]...

This Flowchart sets out the requirements for a transaction defrauding creditors. This flow chart explains the requirements for a transaction defrauding creditors...

This Checklist sets out the issues that should be considered for inclusion in a franchising operations manual The franchise operations manual captures the real-world execution of the franchisor’s system, describing the tasks the franchisee must carry out and the support it can anticipate from the franchisor. Under the franchise agreement, the franchisee is bound to follow the manual to the letter, a discipline widely recognised as driving commercial success. The franchisee will typically consult it daily, particularly during the early phase of trading. The manual might be prepared by the franchisor, or by an independent consultant working with the franchisor’s input. If an outside consultant is engaged, the franchisor must be satisfied that the consultant understands the franchise business. Without that familiarity, the manual may fail to address risks and other essential points that require attention, which could leave the franchisor vulnerable and create further exposure for the franchisor...

Practice Note: Contract interpretation—distinguishing between liquidated damages and penalty clauses As highlighted in this Practice Note, working out whether a liquidated damages provision will be struck down as a penalty is seldom straightforward and often demands careful judgment. Although each dispute turns on the court’s construction of the contract, there are several points to weigh when examining the ambit of a supposed liquidated damages term and its potential exposure to a penalty challenge, both in substance and effect. When you are drafting such a clause, it is vital to keep these considerations in view, and to think about how it sits alongside connected provisions, including any related terms that operate with it. See: Drafting and negotiating a liquidated damages clause—checklist Precedent: Liquidated damages clause For targeted analysis of the way authorities have treated provisions in commercial agreements that stipulate ‘default interest’, see the following materials: Penalty interest rates in commercial contracts Contract interpretation—distinguishing between liquidated damages and penalty...

ARCHIVED: This flowchart has been archived and is not maintained. These flowcharts were produced to help identify whether an asset counts as excluded property for UK inheritance tax (IHT) on or after 6 April 2017. From 6 April 2025, a new framework came into force, replacing domicile as the primary test for an individual’s IHT exposure with the concept of long‑term residence. The reforms also adjusted the criteria for when trust property falls within the scope of excluded property... From 6 April 2025, assets held in trust qualify as excluded property only where: they are non‑UK situs assets, and the settlor is not a long‑term resident of the UK at the point a potential IHT charge arises For more information, see Practice Note: New IHT regime from 6 April 2025—FAQs. The flowcharts consider whether an asset is excluded property by reference to the location (situs) of the property and, where relevant, the domicile of the beneficial owner or settlor...

This Checklist This Checklist outlines practical due diligence actions for selecting and overseeing agents or representatives, such as verifying ownership and control, evaluating country and payment risks, defining scope and remuneration (including success fee exposure), confirming competence and credentials, and making sure fees, licences and facilitation payment controls are consistent with the company’s anti-bribery requirements. Practitioners supporting clients with appointing and supervising agents or representatives should reflect on the following: every agent or representative of the business should be subject to due diligence the company must undertake its own enquiries and augment any information with newspaper or web-based research to satisfy itself regarding each agent whether the company has analysed and documented the rationale for, and the procedure by which, an agent was appointed...

AMR represents a mounting global public health threat, with some analyses attributing up to five million deaths each year. It is therefore unequivocally a core ESG priority for life sciences. In a year poised to be pivotal for coordinated action—underscored by its profile at the UN High Level Meeting in September 2023—the government has set out firm pledges. It has released the Second 5 year AMR National Action Plan for 2024–2029 (the Action Plan) (see: LNB News 08/05/2024 25), designed to advance the UK’s 20 year vision to contain AMR by 2040 and acting as a key strand of the UK’s recently revised Biosecurity Strategy. The Action Plan frames commitments across four pillars: cutting the need for, and unintended exposure to, antimicrobials; optimising antimicrobial use; driving innovation, and ensuring supply and access; acting as a responsible global partner. We highlight below ESG developments pertinent to life sciences. Market failures The Action Plan prioritises boosting R&D and remedying entrenched market...

Honduras rejects the ICSID Convention In recent weeks, Honduras announced it would repudiate the international treaty under which it consented to submit disputes to the World Bank’s International Centre for Settlement of Investment Disputes (ICSD), better known as the ICSID Convention. The move followed the country being hit last year with nine distinct ICSID claims, among them a politically charged action brought by a US-based developer seeking up to US$10.7bn in compensation. Honduras now mirrors three other Latin American states that have denounced the ICSID Convention: Ecuador, Bolivia and Venezuela. Across Europe, parliament have also been keen to jettison investment arbitration in favour of a new investor court, promising reforms they believe could rebalance a regime that critics often say tilts towards investors. India, South Africa and New Zealand have likewise taken steps in recent years to curb their exposure to investor–state disputes, so at first sight it may seem these Latin American moves are part of a worldwide revolt against investor–state arbitration. Yet that impression would overlook a...

The US Department of Justice (DOJ) under the Trump administration has signalled it will deploy every instrument at its disposal—including the FCPA and the Anti-Terrorism Act (ATA)—to go after such targets. What, then, should compliance professionals understand about where FCPA and ATA risks intersect? At face value, the FCPA and ATA seem to address separate exposures: the FCPA tackles bribery of overseas officials, whereas the ATA centres on, among other matters, supplying material support to, or aiding and abetting, foreign terrorist organisations (FTOs). In reality, though, these hazards can collide—especially in markets with significant FTO presence—producing concurrent exposure. Background On 20 January 2025, President Donald Trump signed Executive Order No 14157, directing, among other measures, that specified international cartels and other transnational criminal organisations (TCOs) be classified as FTOs. Since February 2025, the US State Department has designated 11 organisations—primarily in Latin America—as FTOs. These listings carry meaningful consequences: the ATA imposes broad civil and criminal liability for furnishing material support to FTOs, and permits asset forfeiture...

The Pensions Regulator (the Regulator) The Regulator is an arm’s-length public body set up under the Pensions Act 2004 (PeA 2004). Its authority to impose contribution notices and financial support directions appears in PeA 2004, ss 38–50. Although the Act does not use the label, these provisions are widely known as the Regulator’s ‘moral hazard’ powers. Their purpose is to counter the ‘moral hazard’ arising from the Pension Protection Fund (PPF): the possibility that corporate groups might organise their structures so as to heighten exposure within their pension schemes, comfortable that the PPF would intervene if the employer entered insolvency. The principal moral hazard tools—and the only ones exercised so far—are the power to issue a contribution notice (CN) and the power to issue a financial support direction (FSD). A CN compels the recipient to pay a specified amount into a defined benefit occupational pension scheme. A CN can be issued where the criteria in PeA 2004, s 38 are satisfied. These mechanisms exist to deter behaviour that would...

This Practice Note sets out the essentials of Regulation (EU) 2024/2847, the EU Cyber Resilience Act (CRA): its background, timeline, aims, and how it aligns with other EU laws. For details on the CRA’s scope or core duties for economic operators, see the following Practice Notes: The EU Cyber Resilience Act—scope and classification of products The EU Cyber Resilience Act—obligations, compliance and enforcement Regulation (EU) 2024/2847, known as the CRA, is the first EU measure to set mandatory cybersecurity requirements for ‘products with digital elements’ across the EU. From December 2027, products that do not satisfy these requirements cannot be placed on the EU market. Accordingly, compliance will be crucial for market entry for both hardware and software. Manufacturers, importers and distributors will have extensive cybersecurity responsibilities and risk significant fines for non-compliance. The CRA was published in the Official Journal of the EU on 20 November 2024, entered into force on 10 December 2024, and applies in full from 11...

The most common reasons for entering into derivatives are for the purposes of: Speculation — when a party seeks exposure to a given variable, for example taking a view on a commodity’s future price on the assumption it will rise or fall over a chosen period Hedging — aiming to offset exposure to the risk of an unfavourable shift in a variable, or to stabilise expected outcomes over time Arbitrage — seeking to take advantage of price discrepancies (between markets, or within the same market over time) to earn profit or cut costs, or where one participant can reach a price or market unavailable to another, including where prices differ over time Exposure to asset classes — obtaining access to a target market (eg commodities, shares, property) without incurring the expense, complexity and formalities associated with those markets, avoiding the same costs and complications Derivatives are commonly used alongside lending arrangements for hedging purposes in practice. In this context, the primary...

Claim Number: [ insert number ] IN THE HIGH COURT OF JUSTICE KING'S BENCH DIVISION Claim for Fatal Mesothelioma BETWEEN: [ name of Claimant ] Claimant (acting as Personal Representative of the estate of [ insert name ], Deceased) -and- B COMPANY LTD Defendant PARTICULARS OF CLAIM The claimant The claimant is the widow of [ name ] and serves as the personal representative of that estate (‘the deceased’). The claimant issues this claim for the estate under the Law Reform (Miscellaneous Provisions) Act 1934, and for herself, as the deceased’s dependant widow, under the Fatal Accidents Act 1976...

To: The individuals named in Schedule 1 to this letter [ insert names of Lenders ] From: [ insert name of solicitors for the Creditors' Committee or the name of the Chair ] Date: [ insert date ] Appointment of Creditors' Committee We refer to the conversations at the meeting of creditors convened by [ insert name of debtor company ] (the Company) concerning the proposed restructuring...

Insurance Premium Adjustment for D&O Climate-related Financial Disclosures (Archie’s Clause) (The Chancery Lane Project) This clause encourages organisations to lessen climate exposure by offering lower insurance premiums to policyholders who satisfy agreed reporting disclosure standards for climate-related financial risks...

Trustees frequently seek to limit personal liability when entering a deal (here, a transfer). Whether a purchaser agrees is subject to negotiation. In this scenario, the exposure for the second trustee appears slight, as they are disposing of just one asset, so they might be willing to abandon that condition. The purchaser must be satisfied that the trustee has been properly appointed and is authorised to give a valid receipt for the sale monies so that any equitable interests are overreached...

Rights when assignee’s lease forfeited because of a former leaseholder’s breach An assignee’s personal exposure for breaches committed before a lease is assigned is restricted, and a tenant will generally be responsible only where the lease contains an express covenant dealing with those breaches and allocating liability. Without such an express term, the landlord has no covenant to pursue against the assignee for defaults that were fully committed prior to the assignment of the lease. Forfeiture, by contrast, is a proprietary remedy rather than a personal one under the lease. It can be exercised by a landlord against a tenant for breach of covenant under that lease. See Practice Note: ....

This Q&A considers a tenant who is in a tenancy in common with another tenant, who petitions for bankruptcy after exchange and before the completion of a sale of the property that the two tenants own. It examines the first co-owner’s exposure to the purchaser and what remedies he or she may pursue against the other co-tenant if the purchaser serves a notice to complete. As to contractual responsibility, this turns on the contract’s terms. By way of illustration, if the sellers have joint and several obligations, the innocent party is nonetheless answerable to the purchasers. For further details, see Practice Note: Joint, several, and joint and several liability...