GIBRALTAR Law and Practice Contributed by: Adrian Pilcher, Stuart Dalmedo and Louise Anne Turnock, ISOLAS LLP
Governance Code for Gibraltar Crypto Funds). Following the success of the first edition of the Corporate Governance Code for Gibraltar Cryp - to Funds, an updated second edition was pub - lished in March 2022. It is important to note, however, that the Code is not legally binding and operates under the prin - ciple of “comply or explain” which is to say, the Code is not there to say how something must be done. The Code is there to encourage licensees to consider certain issues and, where the licen - see feels that those issues are better dealt with in a different fashion, to document their thought process. 1.3 Corporate Governance Requirements for Companies With Publicly Traded Shares In addition to the requirements discussed in 1.2 Sources of Corporate Governance Require- ments , companies with shares that are publicly traded must also comply with the EU Market Abuse Regulation, which continues to apply in Gibraltar, subject to certain amendments intro - duced under the Financial Services (Market Abuse) (Amendment) (EU Exit) Regulations 2020 in order to address deficiencies and to ensure that the EU Market Abuse Regulation is able to operate effectively under Gibraltar law following Gibraltar’s withdrawal from the EU. 2. Corporate Governance Context 2.1 Hot Topics in Corporate Governance Sanctions By virtue of the Sanctions Act 2019 (the “Act” ), international sanctions have effect in Gibraltar. Such measures include the application of: • EU sanctions;
• UN Security Council sanctions; • any restrictive measures imposed by means of a designation within the meaning of the UK Terrorist Asset-Freezing etc. Act 2010; • any restrictive measures imposed by an organisation that is notified by the govern - ment by notice published in the Gazette; and • any restrictive measures imposed by the UK under the Sanctions and Anti-Money Laun - dering Act 2018. The Act therefore provides for the automatic rec - ognition and application of any restrictive meas - ures imposed by the UN, the UK and the EU. The implementation of such measures has had quite an impact on corporate governance, particularly since the recent events in Ukraine, and particu - larly for the legal and corporate service providers industry. When dealing with a Russian individual or corporation, or any person or entity connect - ed with Russia, for example, service providers in Gibraltar have to navigate the different sanctions regimes imposed by the UN, the UK and the EU. ESG Additionally, the rise of environmental, social and governance (ESG) initiatives has seen an increasing number of firms taking measures to reduce their carbon footprint and in turn increase their economic sustainability in order to remain attractive in the legal market. ESG standards are a criteria used to ascertain the sustainability of the non-financial impact of investments. Firms have dedicated themselves to organising and setting up ESG teams in order to assist with the navigation of ESG disclosure requirements, which we are moving towards. See 2.2 ESG Considerations . 2.2 ESG Considerations Under the Companies Act, a large company (as defined within the Companies Act) which is a
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