Corporate Blawg UK

Toxicity - a stag party in Birmingham

Ouch!  Corporate Blawg has returned from a great friend's stag weekend.  I'll tell you why "ouch":

Corporate Blawg is covered in welts from being pummelled by paintballs; he has aching arms and whip lash from crashing into barriers whilst Go-Karting; and worst of all, his pride is damaged from missing all the targets on the firing range. 

After his sh*te shooting, and poor pistoling, the rifle instructor publicly declared Corporate Blawg's effort back at the ranch, where the other instructors laughed in agreement that it was the worst anyone had ever done, even worse than a blind guy last year.  Corporate Blawg is glad that he does not need to kill to eat, and passes three Tescos on his way to work each morning.

Corporate Blawg then spent £45 on bets at the dog races, winning a total of zero pounds over a period of 2 hours.  In continuance of this appalling form, the stag party then hit the hotel bar, the Bank bar, the Pitcher and Piano and proceeded to study the form of other types of dogs. 

Uninterested in building physical bonds with Brummies, Corporate Blawg led the warpath to Legs Eleven, where he emptied his wallet into the purses of dancing girls, who have now booked their summer holidays to Hawaii. 

On confessing all, Corporate Blawg's wife was less than pleased by this behaviour.  Fortunately, Corporate Blawg's wife is kind and understanding, much more beautiful than any stripper, and will recieve that Links of London bracelet she pointed out to Corporate Blawg last week.

The stag himself got off relatively lightly, only having to be dressed up as Kate Bush for 24 hours, and being a firing target for all of the afternoon.  Needless to say, a great time was had by all.  However, now the toxins are oozing from certain of Corporate Blawg's pores which are outside the usual jursidiction for their expurgation.  Corporate Blawg is now suffering from a weekend of too many toxins in the city of toxicity.

The rather cool term relating to "toxic jurisdictions" is a term is not widely used to date, it will soon be, after this posting, probably.  The term has evolved from Rule 30.3 of the City Code on Takeovers and Mergers.  The Rule is part of the implementation of the European Takeovers Directive 2004/25/EC.

The rule states that information documents posted to shareholders and employee representatives must be posted to all shareholders and employee representatives no matter where they are.  Yet posting such documents in certain jurisdictions may create further obligations under that jurisdictions' securities law.  These jurisdication are known as toxic jurisdications. Consequently, it is not uncommon to see in such documents disclaimers and provisos stating that the document should not be served in U.S.A., Canada, Australia, Japan, China and now more often than not South Africa too.

Even though the rule is to be interpreted widely, the notes to the Rule 30.3 state a number of situations where it can be avoided, including:

In all other cases, the Panel may grant a dispensation where it would be proportionate in teh circumstances to do so having regard, notably, to the cost involved, any resulting delay to the transaction, the number of registered sharesholders in the relevant jursidcition, the number of shares involved and any other factors invoked by the offeror or the offeree company.

As in most other aspects of Mergers and Takeovers, the Panel is pretty much God.  And if you come across the term "toxic jurisdiction" again it is unlikley to be a reference to Corporate Blawg oozing alcohol out of eyelids, but more likely a country with tight securities laws.

P.S. Both Tim Kevan and The Bar Council have obtained Corporate Blawg's respect in a coup de force that Corporate Blawg did not expect.  Their action was simply to publish Corporate Blawg's comment here.  Well done chaps.

Fair enough, monkey-brain

TV stars, pop idols, lottery winners, chav champions, new money, old money, Cambridge graduates, sons and daughters of wise investments in the '60s. Ski-skinned smoothies, pink pashmina wearers, Gucci bag owners, Louis Vuitton fans, domiciles of Chelsea and drivers of loud sports cars that roar between the King's Road and Notting Hill. These are a few of my least favourite things.

Life is unfair, but that doesn't stop us being outraged when we are treated with unfairness.  A response to unfairness may be to:

1. reject the source of unfairness,
2. take an artificial moral highground, or
3. physically remove the afronting situation. 

Accordingly, it is Corporate Blawg's financial mediocrity that enables him to group "low life" with "high life" by their emphasis on irrelevant status symbols and displays of baboon-like competitive behaviour.

But not all monkeys are the same.

(Corporate Blawg is fascinated by monkeys.  He knows he descended from apes, because he is hairy and prefers to get his point across by grunting rather than speaking in sentances.)

An uplifting article in the National Geographic of 17 September 2003 highlights how Sarah Brosnan undertook a study on brown capuchin monkeys (Cebus apella) to find they have a deep understanding of fairness. The experiment was like this: two monkeys were paired up. Pairs were placed next to each other and trained to give human researchers a small granite rock in order to receive a reward.  The standard reward was a piece of cucumber, but sometimes grapes were given out to certain monkeys instead! Other monkeys who witnessed such unfair treatment (and failed to benefit from it):

1. refused future exchanges with human researchers, or
2. rejected cucumbers received for their work, or
3. sometimes even threw their cucumber rewards at the researchers.

Big respect to the capuchin monkeys!

Even though this may not demonstrate altruism, it does represent recognition of the principle of fairness. There is clearly an evolutionary background to our outrage in our perception of unfairness.

Professor Ernst Fehr is the academic leader in the principles of fairness who (surprisingly has not yet written a book called "Fehr on Fairness") has written a host of interesting papers on how people react with their bargaining position in different situations:

"The self-interest model has been very successful in explaining individual behavior on competitive markets, but it is unambiguously refuted in many situations in which individuals interact strategically. The experimental evidence on, e.g., ultimatum games, dictator games, gift exchange games, and public good games, demonstrates unambiguously that many people are not only maximizing their own material payoffs, but that they are also concerned about social comparisons, fairness, and the desire to reciprocate." Theories of Fairness and Reciprocity – Evidence and Economic Applications", Ernst Fehr and Klaus Schmidt (February 2001).

So this is solid evidence that playing hard-ball in negotiations (with the wife) will rarely likely to achieve the best result. 

In review of the least favourite things of Corporate Blawg, Corporate Blawg now considers that his situation is anything but unfair and he should be less critical.  Even though Corporate Blawg was not born with a yacht and a WC1 post code, he does have a beautiful wife, a job he enjoys, and a dinner of toad-in-the-hole to be shared with some friends.  Accordingly, he has maximised his payoff with regard to social comparisons, fairness, and the desire to reciprocate.  And in this regard, even pink-pashminas and ski-tans have their rightful place in the world (on the other side of town).

Concluding this ramble, Corporate Blawg drags you towards Corporate Blueg, and a legal issue brought to him through a really good blog written by a commercial law PSL, which he now can't find on Google...

The Office of Fair Trading has published a 200 page consultation document in relation to their revised guidance for the Unfair Terms in Consumer Contracts Regulations 1999. The purpose of this tome is to ensure that the format and, broadly speaking, content of the guidance is "relevant, clear and comprehensive". The OFT state that they are not consulting on the law, but on how clearly they have presented their interpretation and enforcement of the Regulations.

The right side of Corporate Blueg is minded to reply to the OFT that their document is very neat and tidy, well done, gold star. The left side of Corporate Blueg is minded to point out that clear interpretation of the law is the law.  Nevertheless, for want of leaving an online footprint, Corporate Blueg is shtum... but must note that this consultation procedure seems like rite of passage more than having any real value, and will probably not affect the finalised guidance that will be published in August later this year.

So enough Gov-bashing, what does the draft guidance say?

In standard terms to consumer contracts, the key is whether the terms are fair. The OFT's starting point in assessing the fairness of the term is to ask what would be the position for the consumer if it did not appear in the contract, so transparency is central top fairness. The Regulation 5(1) states that a standard term is unfair:

"if, contrary to the requirement of good faith, it causes a significant imbalance in the parties' rights and obligations arising under the contract, to the detriment of the consumer."

Apparently the principal of good faith embodies a general "principle of fair and open dealing". In assessing fairness the OFT notes how a term will be open to challenge if it is so wide that if it could be used to the consumers detriment. It may be considered unfair if it could have an unfair effect, even if it is not at present being used unfairly in practice and there is no current intention to use it unfairly.  this does seem rather harsh, but the OFT are clearly trying to maximise their payoff.

An example on page 104 of the rather lengthy annex, is that a clause stating: "on completion of the work the client hereby agrees to pay the balance to the site foreman"… should be changed to…"on satisfactory completion of the work the client hereby agrees to pay the balance to the site foreman".

Well done OFT - inspired, and VFM (either Value For Money, or Very F**king Mediocre, take your pick).

Despite one or two oddities, the guidance does actually serve quite a useful tool for establishing what is a fair standard term in a consumer contract. Corporate Blawg would not be surprised to see precedents written using 100% terms from the guidance, even though the OFT's disclaimer removes any legal reliance on the terms in the guidance.

Whatever Corporate Blawg may have said about fairness above, he's not Scandinavian nor Dutch, so will never have a good reason to be fair.  HA Ha ha.

Directionless chit-chat of a contented lawyer

Corporate Blawg has returned from his hols in Norway.  There, he used cross-country skis to cross at least 2 km of country to a sheltered spot overlooking a frozen Fjord.  At this spectacular site he burnt some logs with his brother-in-law and further fed the fire with fallen frankfurters and melted marshmallows.  Fortunately the snow kept the beer cool so all was not lost to their ashened faces.

Throughout this Scandinavian sally, it was of great amusement to Corporate Blawg that in Norwegian a "bash" means dropping the kids off at the pool.  There will come a day when Corporate Blawg invites you to his Birthday Bash, where he will Bish-Bash-Bosh his drinks until he bashes into a door and slips over. Corporate Blawg had just as much fun last year, when choosing a cheesy crepe on a Parisian menu and eating his wife's crepe with extra chocolate sauce.  For the avoidance of doubt, Corporate Blawg does not regard himself as childish.

A high-brow Norwegian day was spent in the Munch museum.  Corporate Blawg has a particular interest in Edvard Munch having some years ago written a play in the german expressionist style (Ibsen-esque) about Munch, the father of expressionism.  This play covers the 4 most important years of Munch's life (1898-1902), where he falls in love with Tulla Larson, then he wants to break up with her, but she wants to stay with him, so she stages her own suicide to surprise him at her death bed and to make him realise he loves her, but he ends up shooting through his index finger in his left hand.  Much drama here.  Anyway, to make this play even more unreadable everything Munch says in the play is a direct quote from one of his letters or recorded conversations (albeit removed from context).  Anyone interested in attempting to read this work of painstaking genius should send Corporate Blawg an email and a promise to feed back nice compliments to warm Corporate Blawg's delicate ego.

Demonstrating an iota more of success in creativity, Corporate Blawg was happy to see BabyBarista in the Times Online.  Since Corporate Blawg usually only reads the ever optimistic Independent, Corporate Blawg will now have to go against his principles and delve into the Times for his next fix of this hugely enjoyable blog. 

Even more pleasing is that Nearly Legal has a training contract.  This delights Corporate Blawg immensly and Corporate Blawg wishes Nearly Legal many Congratu-hyper-con-maxi-mega-inter-uber-lations!

Also, in this itty-bitty kind of a post, Corporate Blawg has become aware that Gary McKinnon has lost his appeal to stay in the U.K.  His extradition to the U.S. for breaking into the U.S. mliitary computers will now be appealed in the House of Lords.  Gary has always claimed that he was looking for U.F.O's.  Corporate Blawg thinks this is a great story and, as long as Gary was not really trying to start World War 3 or anything dark like that, Gary has Corporate Blawg's full support. Corporate Blawg particularly likes the title of his support website: "Free Gary - or at least give him a fair trial in the U.K."

Followers of this blog will note that Corporate Blueg has been looking for comedy case names, but with no support, interest or encouragement from any other bloggers.  Imagine the sheer glee and ribulous thrill when on his daily legal update Corporate Blawg discovered T Comedy (UK) Ltd v Easy Managed Transport Ltd [2007] EWHC 611 (Comm).  Here we have the ultimate in comedy case names.  For anyone at all who is even vaguely interested, this case related to the Convention on the Contract for the International Carriage of Goods by Road.

For many, the thrill may somewhat subside at this point.

However, on reading the detail-from-dullwich case, Corporate Blawg discovered that a Turkish factory from which garments of clothes are made is called "Bates Istanbul Tekstil Sanayi Ticaret ve Pazarlama Limited Sirketi" What a great name!  In his judgment, the judge wisely shortened it to "Bates".

Cool terms: Pump and Dump

Cadets in cyberspace, junior surfers and hatchling web-crawlers are all honking their horns in delight at being part of this blog's traffik.  The reason for this gloria is the perpetuar googling for "cool terms" "cool phrases" and "bullet-dodging".  Corporate Blawg is widdit, and able to carry his shiznit around here to spread out coolio on his blog of biznab. Accordingly, ol' cool terms is back, and its proud, and it's all about the pump and dump. Cowabunga dude.

Pumping and dumping is not about eating too many eggs before a work-out in the gym, nor is it a machoismatic mentality for dirty dating.  Below, Corporate Blueg (colourblind people should refer to the lighter text - this is an equal opportunities blog) has divulged what pump and dump should mean in corporate speak, wherefrom the inspiration was discovered in a creaky corner of the FSA's gigantium website.  Nevertheless, the probert encyclopedia shows us with true meaningful expression that:

Pump - Pump is slang for to break wind.
Pump the stump - is slang for "to shake hands".
Pumpers -Pumpers is slang for any anabolic steroid.
Pumpin' - Pumpin' is slang for lively, energetic, thrilling.
Pumpkin -is slang for "the moon", or "the sun".

Therefore, since Corporate Blawk is kooler than the Klingonz, Corporate Blawg will try to become evener groovier by using more slang, as he cruises town under the pumpkin whilst pumpin' pumpin' tunes up to the petrol pump to pump the stump with local hoods in pumps... from his rather large middle-class  saloon.

Corporate Blueg would like to ignore Corporate Blawg or Blawk, and explain that the graphic term "pump and dump" is a phrase for market manipulation where the price of security is artifically inflated through an exaggerated or fraudulent promotion.  Immediately following the rise in the price of the stock, the persons responsible for the promotion dump their shares. 

This is also known as "stock dump" or "hype and dump manipulation" but "pump and dump" wins for being the most pithy, the most seedy and the most easy to remember.

It's an issue that sooo relevant.  According to the Inquirer:

"The first "pump and dump" spam campaign has hit Europe this week, designed to manipulate the share price of a company listed on the German stock exchange,"

And in the middle of last month it was reported that three Indonesian hackers pumped online brokerage accounts to boost their profits - which was the "first case involving people arrested overseas in connection with an online brokerage intrusion scheme carried out in the US."

Basically, it's here and it's fear, it's mad and it's bad, it's illegal and a beagle, it's pumping and dumping and it's market manipulation which is a form of market abuse (and therefore can be penalised by the FSA with an unlimited fine, public humiliation and imprisonment) - so don't do it.

Corporate Blawg is a little disappointed that no one was able to provide any comedy case-names following from his last post.  This is clearly a matter of the river runeth dry, or else that in the ever-changing blogosphere Corporate Blawg is the only comedy / genius. 

Corporate Blawg is now off to Norway now for the Easter break. "No way", I hear you Northerners exclaim.  Yes way, and Norway!