Clauses & Controversies

Discussion on the impact of lifting sanctions on purchasing Venezuelan bonds, influencing geopolitics and bond ownership. Kejal Vyas sheds light on the policy shift and complexities surrounding Venezuelan debt restructuring amidst US sanctions and lobbying efforts.

Exploring the implications of a legal decision on financial bonds, focusing on the validity of collateral under Venezuelan and New York laws. Analysis of the New York Court of Appeals ruling and criticism from market reactions. Discussion on the prevalence of local law provisions in sovereign bonds and the importance of clear authorization processes for corporate and state-owned bonds.

Discussing the sudden surge in value of Ukrenegro bonds after creditors wanted separate debt talks, exploring the unique arrangement with certain bondholders and legal dynamics. Analyzing financial responsibilities of state-owned enterprises and recent price movements of sovereign guaranteed debt. Delving into the complex dynamics of creditor behavior in Ukraine's financial aid and restructuring amidst conflicting interests and political pressures.

Back to the Future (Again) -- Russian Frozen Assets Episode In recent months, there has been much talk about what to do with frozen Russian assets and, in particular, whether they can be repurposed to aid Ukraine in its fight against the Russian invasion. This is not the first time that large amounts of Russian assets have been frozen though, with heated debates about whether to expropriate the frozen funds. In this podcast we talk to Professor Lauge Poulsen of UCL about one of these prior freezings, from the early 1900s. Indeed, the 1918 default of Soviet Russia on investors in Tsarist Russian bonds is still one of the largest ever sovereign defaults and it (along with other expropriations) then resulted in widespread freezing of Russian assets overseas. Lauge and his co author, Eileen Denza, have a fascinating article about the negotiations between the UK Foreign Office and the Soviets over these frozen assets and the ultimate resolution of all of the various claims and counterclaims (a process that took close to three quarters of a century). The article, “Settling Russia’s Imperial and Baltic Debts” appears in the American Journal of International Law. Producer: Leanna Doty

Mitu and Mark discuss the recent debt restructuring by Tierra del Fuego, highlighting coercive tactics like rewarding early consent. They speculate on broader patterns and potential conspiracy theories. The podcast also delves into ethical considerations in financial transactions and the treatment of bondholders in exchange offers.

Industry insiders Mitu and Mark discuss the rise and fall of sustainability linked bonds, questioning their credibility and effectiveness compared to traditional green bonds. They delve into challenges aligning climate policies with SLBs, explore liquidity concerns in the market, and analyze the pitfalls hindering the success of this evolving financial product.

Equity Receiverships and Sovereign Debt Observers of sovereign debt markets have long lamented the inability to impose restructuring terms on dissenting creditors. Indeed, there are currently several bills pending – some of which are utterly bonkers, in our view – in New York to change the law in ways that will limit holdout activity in sovereign debt cases. But what if the tools to comprehensively restructure sovereign debt are already there in New York law? Our guest, Nate Oman (William and Mary) has a new paper, Restructuring Ruritania (link below), examining the potential use of the equity receivership in this context. The equity receivership has a long history (e.g., railroad reorganizations) and has been discussed as a potential solution to state debt crises and other areas. We talk to Nate about what an equity receivership would look like in the sovereign debt context and the advantages (and limitations) it offers. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=4656147 Producer: Leanna Doty

How Much of the YPF Judgement Will Burford, Realistically, Recover? Burford Capital, a highly sophisticated litigation finance operation, has won an enormous judgment ($16 billion, where its share is upwards of $6 billion) against the Republic of Argentina. The question is how much of this judgment Burford is realistically likely to be able to collect on. Using a recent FT Alphaville article, “Dog Catches Argentine Car” by Jay Newman as our foil, we try to break down the likelihood of Burford getting a recovery. We think a significant recovery is plausible – particularly if the new administration in Argentina decides to default and renegotiate all of the myriad claims against it once and for all. Producer: Leanna Doty

Greg Makoff, author of a forthcoming book on Argentina's 2001 debt saga, discusses the mistakes made in the country's debt restructurings, the complexity of the litigation, and the lessons that can be drawn for Argentina's current debt troubles.

Delve into Argentina's FRANs, with a drafting glitch leading lucky investors to 100% annual interest. Ben Heller discusses dodgy exit amendments and sovereign states raising defenses. Explore bond structures, market dynamics, and complex financial instruments. Uncover ethical dilemmas in financial agreements and regulations for abuse prevention in financial restructuring.