Category: Uncategorized

  • Lemchik, Krupskiy & Partners Partners with Union of Mineral Developers

    The Lemchik, Krupskiy & Partners law firm has entered into a strategic partnership with the Russian Union of Mineral Developers, which involves “full legal support of the Union and its members, including support of investment projects.”

    According to the firm, its partnership will involve “such services as the development of the legal structure, tax risks diagnosis, support of investment projects, due diligence, tax consulting, representation in courts, tax disputes, [and] structuring of transactions.”

    Image Source: nytimes.com
  • Wolf Theiss Advises UniCredit Bank Austria on Acquisition of More Shares in UniCredit Tiriac Bank, Romania

    Wolf Theiss has advised UniCredit Bank Austria AG (“UCBA”) in acquiring a 45 per cent shareholding interest in UniCredit Tiriac Bank S.A. (“Tiriac Bank”) from Tiriac Holdings Ltd., which was advised by PeliFilip.

    As a result, of the deal, UCBA’s equity stake in Tiriac Bank increases from 50.6 per cent to 95.6 per cent. The closing of the transaction occurred on June 5, 2015. The selling price and other transaction details have not been publicly disclosed, but Wolf Theiss claims that, “this acquisition marks one of the largest transactions in the active Romanian banking M&A market in recent years.”

    UniCredit Tiriac Bank S.A., a Romanian bank headquartered in Bucharest, is a member of UniCredit’s CEE network. Around 3,350 employees of the bank serve retail and corporate customers at over 180 branches in Romania.

    UCBA was advised by the Bucharest and Vienna offices of Wolf Theiss. In Bucharest, the team was led by Partner Ileana Glodeanu, who stated: “We are proud to have been able to support UCBA on this important transaction and as indeed we have supported them over the past 10 years with respect to the partnership between UCBA and the Tiriac-Group. Quality and consistency are important values at Wolf Theiss which we could prove in this transaction, given that the same core team of Wolf Theiss lawyers have advised UCBA since they first acquired their majority stake in Tiriac Bank in 2005.”

    Glodeanu at Wolf Theiss was supported in Bucharest by Senior Associate Claudia Chiper and Associates Diana Stetiu, Mircea Ciocirlea, and Ramona Hromei. The Austrian Wolf Theiss team was led by Vienna-based Partners Eva Fischer and Nikolaus Paul, and included Associate Markus Taufner and Counsel Marcell Nemeth.

    PeliFilip’s team advising Tiriac Holdings was led by Partner Cristina Filip, assisted by 8 lawyers, including what she calls “4 brilliant Senior Associates”: Monica Statescu, Mihaela Ispas, Alexandra Manciulea, and Mirona Apostu.

  • Greenberg Traurig Represents Banks in Accelerated Book-building Process for CCC Shares

    Greenberg Traurig has advised the UBS Limited and WOOD & Company Financial Services, A.S. Polish Branch investment banks in the sale, through an accelerated book-building process, of CCC S.A. shares by Ultro S.A., an entity controlled by billionaire Dariusz Milek, the President of the Management Board of CCC.

    The sold CCC shares represent 7.84% of the share capital and 6.67% of votes in the company, and the value of the transaction is reported to exceed PLN 511 million (approximately EUR 123 million).

    CCC is the market leader in the Polish footwear retail and one of the biggest manufacturers in Poland. The company sells over 25 million pairs of shoes a year, primarily from its 700 stores, which are located in shopping centers in 14 countries.

    The Greenberg Traurig Warsaw team consisted of Partners Federico Salinas and Ireneusz Matusielanski and Local Partner Pawel Piotrowski.

    Editorial Note: It was subsequently disclosed that Baker & McKenzie advised Dariusz Milka on the share sale. The firm’s team included Partner Jakub Celi?ski and Associate Ryszard Manteuffel.

    Image Source: ccc.eu
  • CMS Advises Triglav INT on Sale of Subsidiary to VIGO Finance

    CMS Prague has advised the Slovenian insurance company Triglav INT, which is fully owned by Zavarovalnica Triglav, on the sale of Triglav pojisovna, its Czech subsidiary, to VIGO Finance, part of the VIGO Investments Group. The buyers were represented by the Heresova Ruzicka law firm.

    Triglav pojistovna is a non-life insurance company in the Czech Republic and was one of the nine insurance or reinsurance subsidiaries of the Triglav Group, one the largest insurance and financial groups in South-Eastern Europe.  Triglav reached an agreement with VIGO regarding the sale of its Czech subsidiary in October last year. The sale was approved by the Czech National Bank in May and reached closing on June 4, 2015.

    The CMS team advising Triglav was led by Corporate Partner Patrik Przyhoda and included Senior Associate Radim Kotlaba and Junior Associate Pavel Drimal.

     

  • Important Aspects of Real Estate Purchases in Latvia

    Important Aspects of Real Estate Purchases in Latvia

    Introduction

    Since 2011 all EU citizens as well as EEA members and Swiss nationals have gradually been granted the right to acquire real estate in Latvia under the same conditions as Latvian nationals. As of May 1st, 2014, all remaining limitations have been abolished. Now EU citizens, EEA members and Swiss nationals have exactly the same rights as Latvian citizens to acquire real estate in Latvia.

    However, general restrictions apply to the acquisition of agricultural or forest land. There is a limit of 2000 hectares per person. Furthermore, it is necessary either to show revenue in this sector during the last three years (amounting to at least a third of a person´s total revenue during that timeframe), to show an education in this sector or to hire an employee with such an education.

    Land Registry

    All Latvian real estate properties are mapped (https://www.kadastrs.lv/) and registered (https://www.zemesgramata.lv) in the Latvian Land Register. All data, including maps, is publicly available in form of digital documents. The land registration and the cadaster use different identification numbers (but these databases are nonetheless interconnected). From kadastrs.lv you can get all the technical information of the property, such as area, cadastral value, cadastral number and borders. From zemesgramata.lv you can get information about ownership of property, encumbrances, rental rights and other registered rights.

    You can – free of charge – get an idea about how much a specific Latvian real estate property is worth by going to https://www.kadastrs.lv/, which is available in English. The cadastral value is an estimate by the State Land Service, which took into account the location of the property, registered data on the quality of the property, type of use, size and other criteria. Some of these estimates are old, but they are still useful as a general guideline. On the website you will also be able to see the real estate´s “cadastre number”, “register unit” and “administrative territory”; more information is accessible for € 2.85 per real estate object.

    Municipality´s first refusal rights

    In every real estate transaction, the local municipality has the “right of first refusal”, meaning that the municipality has the right to buy the property for the agreed price instead of the original buyer, if it needs the property for certain municipal functions defined by law. The parties therefore have to first submit the signed sale´s agreement to the municipality for a decision on its first refusal rights. If the municipality does not need the property for the municipal functions set out by law, the municipality must issue a statement waiving the right of first refusal within five business days. The buyer will have to present the municipality´s approval to the judge at the Land Register before the new ownership of the real estate can be entered into the Land Registry.

    Costs

    The buyer will have to pay the “state fee” of 2% calculated on the basis of either the sale price or of the cadastral value (estimated price by the State Land Service) – whichever is the higher of the two. In case of non-residential buildings, the state fee is capped at € 42.686.15. Furthermore, the buyer will have to pay the office fee of € 14.23 before the registration of ownership in the land register. 

    The seller will have to pay income tax (15% of the profit). However, if the seller owned the property for more than five years and has had his residence there without any interruption for at least one year during these five years, the income tax rate does not apply. 

    VAT application to real estate sales depends on the status of the real estate. Real estate transactions are VAT exempt, if the status of the real estate is “used”. Real estate transactions are subject to the standard 21% VAT rate, if the status of real estate is “unused or new”.

    The acquisition of real estate as such does not cause an obligation for the foreign investor to register for VAT purposes in Latvia. 

    However, it is possible for the buyer to recover all paid VAT immediately by registering with the Latvian VAT Register and holding on to the real estate during the next ten years, if the acquired real estate is used for VAT taxable transactions during that time (e.g. rented out to legal persons). If the acquired real estate is not used for VAT taxable transactions, VAT cannot be recovered. 

    Under certain circumstances the foreign investor is obliged to register with the Latvian VAT Register (depending on the types of services performed, the status of the service recipient or the existence of a permanent establishment in Latvia, etc.). 

    In addition to the costs outlined above, fees for the notary or attorney have to be considered.

    Every year, owners of Latvian real estate property must pay the immovable property tax rate set between 0.2% and 3% of the cadastral value. The exact rate is set by the municipality and is usually not higher than 1.5%. Higher rates (1.5-3%) apply to buildings that are in very terrible condition (bad appearance). Before property can be transferred, all accrued taxes must have been paid by the owner – outstanding taxes (such as the immovable property tax) therefore prohibit the sale. It´s advisable to contact the tax authorities before entering into the sale contract and to make sure that all of these taxes were paid. 

    The entire process from signing the sale contract until registration in the Land Register can be performed within a month.

    Assistance

    For assistance when planning investments in Latvian real estate or when looking for suitable property or in order to get in contact with Latvian real estate brokerages, go to 

    • Latvian Investment and Development Agency (http://www.liaa.gov.lv/),
    • Latvian Chamber of Commerce (http://www.chamber.lv/lv/),
    • German Economic Delegation in Latvia (http://www.ahk-balt.org/) or
    • Austrian Economic Chamber in Riga (http://www.advantageaustria.org/lv).

    Construction

    Possible ways of utilization of real estate or limitations regarding its utilization are governed by the provisions in the spatial plan, local plan and detailed plans issued by the local building authority where the property is located (e.g. “Rigas pilsetas buvvalde – Riga City Building Construction Directorate”).

    Construction is governed by the Construction Law (“Buvniecibas likums”). Furthermore, regulations from the Cabinet of Ministers apply: The general building regulations (“Visparigie buvnoteikumi”) and the Building Construction regulations (“Eku buvnoteikumi”).

    A construction permit is required for all construction of fixed structures and for all renovations, modifications or demolishment (see Section 1 and 18 of the Construction Law).  For different types of buildings it is easier and faster to obtain a permit. If all legal and technical conditions set out in the law are met, the construction authority will issue a construction permit to the applicant. 

    Other

    Risks of latent defects, such as contaminated soil, are carried by the current owner. However, the seller can be held liable for characteristics of the property which he explicitly warranted or which can be ordinarily expected.

    Virtually all possible claims of restitution (in connection to Latvia´s history) have been resolved and in practice there are no restitution issues anymore.

    By Matthias Strohmayer, Lawyer, Varul

  • Sorainen and Tark Grunte Sutkiene Advise on MCI.TechVentures 1.0 Acquisition of Pigu Group

    Tark Grunte Sutkiene has advised the MCI.TechVentures 1.0 private equity fund on the acquisition of a 51% shareholding in the Pigu Group — the leading e-commerce company in the Baltic States. Sorainen advised the Pigu Group on the deal, which remains subject to clearances from competition authorities.

    The Pigu Group operates online shops in Lithuania (Pigu.lt), Latvia (220.lv) and Estonia (kaup24.ee), offering over 90 thousand products, including household appliances, electronics, fashion, cosmetics and children products. It is the e-commerce leader in Lithuania and Latvia, and since 2014 it has been extending its operations in Estonia as well. It has over a million registered customers, and the company’s revenue is nearly EUR 50 million.

    MCI.TechVentures 1.0 is controlled by Private Equity Managers, which itself is part of MCI Group, one of the leading Polish private equity groups. According to Tark Grunte Sutkiene, “MCI … is is one of the most dynamic private equity groups of multistage character in the Central and Eastern Europe. Currently, with the use of PE/VC funds: MCI.EuroVentures 1.0, MCI.TechVentures 1.0, MCI.CreditVentures 2.0 FIZ, Helix Ventures Partners FIZ, [and] Internet Ventures FIZ, MCI implements early stage, growth stage, and expansion/buy-out stage investments in CEE, Germany, and Austria (DACH), in the former Soviet Republic countries … and in Turkey.”

    “In the market the deal is called the e-commerce deal of the year in Lithuania,” said Deimante Korsakaite, Tark Grunte Sutkiene Associate Partner. “We are proud of being part of it. Not only the funds, but as well the experience that MCI shall bring to Lithuanian e-commerce company should upgrade it to the next level.”

    The Sorainen team advising the Pigu Group was led by Partner Laimonas Skibarka and Senior Associate Mantas Petkevicius.

    The Tark Grunte Sutkiene team advising MCI Management and its current shareholders was led by Partner Marius Matonis, Associate Partner Deimante Korsakaite, and Associate Andrius Voska.

     

  • Norton Rose Fulbright Advises Polish State-Owned Investment Vehicle on Financing of Gas-Fired CHP Plant

    Norton Rose Fulbright has advised the Polish state-owned investment vehicle Polskie Inwestycje Rozwojowe S.A. (PIR) on the execution of a preliminary investment memorandum with EDF Polska concerning the financing of a new gas-fired CHP plant in Torun, Poland.

    PIR and EDF Polska plan to create an SPV that will develop the approximately PLN 550 million (approximately EUR 132 million) project. PIR will provide PLN 275 million (approximately EUR 66 million) in financing under the Polish Investments program. which provides financing for long-term and commercially viable infrastructure projects that contribute to the growth of GDP and help create new jobs in Poland.

    The construction of the gas-fired CHP plant in Torun is set to begin this year, and its commissioning is planned to take place in the first half of 2017. The construction of the new CHP plant alone is expected to create 250 jobs.

    The Norton Rose Fulbright team is led by Partner Rafal Hajduk, assisted by Of Counsel Artur Jonczyk.

    Image Source: poland.epf.com
  • Samardzic in Cooperation with Specht & Partner Successfully Represents Danos in Damage Claim

    Samardzic in cooperation with Specht & Partner has successfully advised and represented Danos Ltd – a Serbian rolling-stock trading company with long-standing prominence in the railway sector – as plaintiff, in a dispute for breach of a joint-sale contract against an unidentified Serbian rolling stock producer.

    Samardzic in cooperation with Specht & Partner reports that “the Commercial Court in Pozarevac, Serbia, acting in first instance, has ordered the defendant, one of the leading rolling stock producers on the territory of former Yugoslavia and a member of a European rolling-stock producing group, to pay damages in the amount of EUR 108,000, along with accrued interest.” 

    The Court found that the rolling stock producer breached an exclusive joint sales contract by refusing to pay a contractual fee to Danos in relation to a project worth EUR 3 million. The defendant has appealed the ruling.  

    This was the second successful involvement of Samardzic in cooperation with Specht & Partner in a dispute with identical parties. In 2013 and 2014 the firm obtained damages of over EUR 40,000 on behalf of Pro Rail Ltd., a rolling design & engineering company belonging to the same owner as Danos Ltd, against the same defendant. 

    The firm’s team was lead by Junior Partner Milica Samardzic, who was counseled by Managing Partner Dusan Rakitic.

  • Austrian Advisors Among Global Freshfields Team Advising Vossloh on Refinancing

    Vienna-based Tax Partner Michael Sedlaczek and Associate Mario Zuger were on the international Freshfields team advising Vossloh on a successful refinancing by means of a syndicated loan amounting to EUR 500 million. The credit lines are used to refinance existing debt and general corporate purposes of the Vossloh Group. The syndicated loan has a term of three years.

    The Vossloh Group is a leading global provider of products and services for the rail infrastructure as railway vehicles and trolleybuses.

    In addition to Sedlaczek and Zuger, the international Freshfields team included Frank Laudenklos, Simon Reitz, Sebastian Hafele, Scott Mody, Martin Schiessl, Nicolas Wolski, Florian Klimscha, Julia Albrecht, Erik Hodl, Fabrice Grillo, Geoffrey Levesque, Cyril Valentin, James Douglas, Charles Peet, Clare Joyce, Claude Stansbury, Karen Kim, Inaki Gabilondo, Guillermo Sanchez-Ostiz Gallego, Isabel Villa, and Cinta de Retana.

    Image Source: vossloh.com
  • Turunc and Linklaters Advise Borsa Istanbul on Term Sheet with EBRD for Sale of 10% Stake

    The Turunc law firm and Linklaters have advised Borsa Istanbul on the recent execution of a term sheet with the EBRD for the sale of a 10% stake.

    Borsa Istanbul, the sole exchange entity in Turkey, was created in 2013 by combining the Istanbul Stock Exchange, the Istanbul Gold Exchange and the Turkish Derivatives Exchange. It is majority-owned by the Turkish government. A summary of the deal on the Borsa website describes it as “a landmark deal which will support Turkey’s efforts to reshape its capital markets.”

    Phil Bennett, EBRD First Vice President, and Noel Edison, the EBRD Director for Insurance and Financial Services, signed a term sheet in Istanbul on May 29 with Borsa Istanbul Chairman Talat Ulussever and Borsa Istanbul CEO Tuncay Dinc, paving the way for the EBRD’s pre-IPO investment. Expected to take place next year, the IPO is part of the government’s comprehensive plan to reshape Turkey’s capital markets and turn the country into a financial hub for the region spanning Central Asia, south-eastern Europe, and North Africa.

    Phill Bennett said: “Borsa Istanbul is at the heart of Turkey’s ambition to become a financial centre for the wider region. As a shareholder in Borsa Istanbul we will support its efforts to become a leading stock exchange in terms of the number of listed companies and market capitalisation, reflecting Turkey’s economic potential.”

    Noel Edison added: “This investment is part of the EBRD’s long-term strategy in Turkey to help the country deepen its capital markets. We will work to improve the efficiency and liquidity of the bourse to make it more attractive to domestic companies and foreign investors and will also help with the preparations for a successful public listing.”

    Borsa Istanbul’s CEO Tuncay Dinc said: “As a founding member of the EBRD, Turkey will benefit from the Bank’s direct investment in Borsa Istanbul. This long-term pre-IPO investment is yet another indication of the great potential of Turkish capital markets and Borsa Istanbul. We consider this strategic partnership to be another important milestone on the road to making Istanbul an international financial hub.”

    The Turunc team was led by Partner Kerem Turunc, while the Linklaters team was led by Partner Daniel Cousens, supported by Associates Kirill Donskikh and Pavlos Kaimakliotis.

    The EBRD has, in the past, also undertaken a pre-IPO investment in the Moscow Exchange and invested in the Bucharest Stock Exchange. The Bank also supports SEE Link, an order-routing system established by the Bulgarian, FYR Macedonian, and Zagreb stock exchanges and aimed at increasing liquidity and advancing standardization among the connected bourses.

    The EBRD started investing in Turkey in 2009 and currently operates from offices in Istanbul, Ankara, and Gaziantep. In the past six years the Bank has invested over EUR 5 billion in Turkey through more than 140 projects in infrastructure, energy, agribusiness, industry, and finance. It has also mobilised over EUR 12 billion for these ventures from other sources of financing. Recently, the Bank also invested in YDA Insaat’s first Turkish lira-denominated bond listed on Borsa Istanbul. 

    In 2014 Turkey became the leading recipient country of the EBRD, with new investments worth EUR 1.4 billion.

    Earlier this spring Turunc represented Borsa Istanbul in two related agreements with the London Metal Exchange (LME) and LME’s parent company, and the Hong Kong Exchanges and Clearing (HKEx) (reported on by CEE Legal Matters on April 20, 2015), and a partnership with the London stock exchange (reported on by CEE Legal Matters on April 17, 2015).

    Image Source: borsaistanbul.com