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Our Commodities Capabilities
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An award-winning firm and commodities practice
International law firm Clifford Chance combines the highest global standards with local expertise across our 36 international offices.Leading lawyers from different backgrounds and nationalities come together as one firm, offering unrivalled depth of legal resourcesacross the key markets of Africa, the Americas, Asia Pacific, Europe and the Middle East. The firm focuses on the core areas ofcommercial activity: finance and banking capital markets; corporate and M&A; litigation and dispute resolution; real estate, and tax,pensions and employment. Through a strong understanding of clients’ cultures and objectives, Clifford Chance draws on the fullbreadth of its legal skills to provide results-driven, commercial advice.
Our award winning commodities practice covers a diverse range of commodity – related products and derivatives. We recognise thata commodities practice requires a multitude of skill sets and, therefore, we bring together our expertise to best service the full rangeof clients, including, inter alia, Banks, Trading Companies, Corporates, Insurance Companies and Exchanges.
DerivativesProducts
Regulatory& AntiTrust
Tax
Insurance
Litigation
CommodityFinancing
OurCommodities
Practice
“A great name in thetransactional sphere,regularly sought outby prominent clientssuch as commoditiestraders and privateequity funds for itsservices in tradefinance”Commodities –Chambers UK 2015
“Clifford Chancestands out for its‘strength in metalsand naturalresources”Commodities – Legal 5002014
“Ranked No. 1 LawFirm”Chambers GlobalTop 30 2015
“Finance Team of theYear”Legal Business Awards2015
“International LawFirm of the Year2014” IFLR Europe
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Mining and Metals
Some highlight examples include advising:n VTB Capital in establishing new platform documentation for the trading of
physically-delivered precious metals (including platinum, palladium, gold and silver)between VTB Capital plc and its counterparties
n RBI on a financing to a gold mining group with operations in the former USSR,Africa and Canada
n the swap counterparty and index provider on a currency-hedged, swap-backedexchange traded product programme linked to gold, silver, platinumand palladium.
n an international commodities company on a US$250 million energy receivablesborrowing base facility for metals in the US
n Eurasian Resources Group, a new vehicle established at the direction of ENRCfounders and the Kazakh government, on its c.£3billion offer for the existing andto be issued shares of ENRC other than those it already held
n an international commodities company on a US$1.7 billion secured metals(receivables and inventory) borrowing base facility
n the lenders on a US$600 million pre-export financing facility in relation to aKazakhstan based metals company
n an international commodities company on a US$200 million uncommitted securedmetals borrowing base facility in Peru
n the borrower on a US$100 million uncommitted commodity stock financing formetals in the Netherlands and Russia
n the lenders on a US$800 million secured metals (receivables and inventory)borrowing base facility
n an international bank seeking to structure alternative funding arrangements for steelbillet purchases by a Latin American buyer without a buyer funding the bank forstandby LCs issued by the bank to the seller of the steel billets
n a bank in relation to fraudulent letters of credit in relation to the Solo Industriessteel fraud
We have a truly global, cross-discipline team who advise onthe full range of mining related transactions and projects.
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n banks providing finance through documentary credits andtrust receipts in the Hofflighouse steel trading fraud
n a client in the provision of advice with respect of thenetting of coal trading contracts (SCOTA) with othercommodities managed on a portfolio basis
n a client in drafting copper repo documentation
n a client on a steel billet monetisation structure
n a client on a multi-metal master trading template and metalspecific confirmations
n on the structural reorganisation of a European bank’smetals business
Additional highlight examples include advising:n Morgan Stanley both under English law and New York law
on Template Gold Loan documents
n on counterparty credit risk analysis of bullion repositorystructures and large scale hedging of gold extraction andrefinancing activities
n on a review of Precious Metals Custody and StorageAgreements in light of Post Lehman risk assessment by anumber of clients in relation to their holdings of bullion andplatinum both in national bank and private vaults
n an international bank in its capacity as agent for aUSD1.5 billion syndicated repurchase facility entered intoby Bear Stearns with a syndicate of banks. We drafted thebespoke documentation and created the syndicatedframework structure to enable repos of securities, warrantsand metals (gold, silver, platinum and palladium)
n an investment bank on the question of whether it wasrequired to register bullion under the REACH regulation asa result of its trading activities.
n on credit risk mitigation in new and emerging asset classessuch as uranium processing and iron ore
n on the preparation of documentation for gold-linked loansand central banks bullion repo financing
n on handling disputes (resolved by arbitration and litigation)for commodity traders involving oil, steel, metals, nuts,soya, grain, sugar and related futures
n “Often acts as counsel on high-end corporatetransactions on a global basis, and its client listincludes a number of mining majors”Energy & Natural Resources, Mining – Chambers UK 2015
n “Exceptional international capabilities, with teamsacross several continents advising top-level energyclients on market-leading projects”Energy & Natural Resources, Mining – ChambersGlobal 2015
n “They are always able to find team members with therelevant expertise and language skills.” – “CliffordChance will always be up there as they do thebig deals.”Energy & Natural Resources – Chambers UK 2014
n “The lawyers on this “excellent team” are “very cooperative and thoughtful; they will put themselves inthe shoes of their clients and always put clients’interests first”Energy & Natural Resources: Mining – Chambers UK 2013
n “Sources say: “Our overall impression of the firm isextremely positive: they have a very coherentapproach, and are consistent in their delivery acrossdifferent groups and teams”Projects & Energy: Mining & Minerals – Chambers Global 2013
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Case Study – EMED Mining Public Limited
Clifford Chance (out of its offices in London and Madrid) is advising Goldman Sachs onarrangements relating to the funding of the restart of operations at the Rio Tinto copper mine inAndalucía, one of the largest copper deposits in Spain.
The arrangements are structured to include commodities prepayment arrangements and physicalofftake arrangements, commodities, interest rate and currency swaps. All of these are organisedin a tax efficient manner through an orphan SPV. The transaction cannot be obviouslypigeon-holed as any one particular form of finance and is therefore a hybrid transaction.
A small team from Clifford Chance, that includes regulatory and finance partners from Spain, isadvising on the wide variety of legal specialisms that are required to execute a deal of this nature.The deal demonstrates our ability to execute a deal that incorporates a variety of financetechniques, a knowledge of the commodities market and an understanding of the constraintswithin which the mine owner and the funding parties operate.
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Oil & Gas
Our team is made up of acknowledged experts in the oiland gas industry, offering you depth of resource, localexpertise and a long-term presence in, and commitmentto, the key oil and gas markets across the globe.Some highlight examples include advising:
n an international commodities company in connection with a US$300 million oilreceivables borrowing base facility in Singapore
n the borrower on a US$100 million uncommitted credit line for petroleum products
n sponsors putting in place inflation, interest rate and currency hedging with asyndicate of banks to support a major PFI project
n joint lead managers and syndicate banks putting in place inflation, interest rateand energy hedging arrangements in connection with regulated utility companies
n on bespoke oil hedging arrangements in the context of project financing of oilrefinancers
n an international bank with regard hedging oil production capacity in the context ofa US$575 million acquisition finance facility arranged with an Emirati Oil producer;instructions included drafting and negotiating the oil hedging documentationincluding the hedging policy and the intercreditor arrangements
n on designing an online sanctions compliance service subscribed to by a major oilmultinational and utilised throughout its global legal and compliance team (and byparts of its business)
n on sanctions issues arising out of Iranian contracts in connection with a clients’acquisition of an oil field services company
n a major financial institution wide-ranging advice relating to potential risksassociated with a variety of proposed oil and petroleum trading operations
n an international oil trading company on anti-corruption, bribery and extraditionissues in connection with trading with Nigeria and resulting money launderinginvestigation, drafting an internal compliance manual and procedures, along withagency contract templates incorporating anti-corruption provisions, and training
n financial institutions and major oil multinationals on sanctions issues relating, inparticular, to oil trading
n a leading US bank in relation to disputes with two Central European oil companiesconcerning loans where the interest rate was a derivative linked to the price of oil
Additional highlight examples include advising:
n on potential disputes involving commodity derivatives nolonger economic which the counterparty has argued areoutside the scope of its regulatory permission to conductderivative transactions
n on a dispute concerning a commodity option entered intowith our client by a state-owned petroleum company in anAsian country as a hedge against rising oil prices. Followingthe fall in oil prices (as a result of which the economics ofthe trade became less favourable for the counterparty) thecounterparty alleged that the trade was outside its capacityunder the relevant legislation and without proper authority.This matter involves complex derivative transactions
n a global bank on its rights and obligations in connectionwith “failed” trades in Venezuelan Oil Warrants attached to
Venezuelan Brady Bonds (which were designed to giveholders a return if the oil price hit a threshold price)
n an investment bank in an investigation resulting from arogue trader’s activities on ICE trading WTI crude oil futuresand freight futures. We also handled the FSA investigationinto the relation to trader
n the PRC and Hong Kong operations of a multinationalcorporation in respect of an external regulatoryinvestigation into alleged malpractices by its trading team inrespect of Singapore traded oil and gas contracts
n a financial institution in relation to a major fraud by anoil-trading client. This matter involved several aspectsincluding claims for misdelivery of oil cargos
n several oil companies and oil trading houses in oiltrade disputes
n “A project finance powerhouse”Projects & Energy - Chambers Global 2015
n “A major international force with the capacity toadvise clients throughout the projects and energyarena” – “Market-leading practices in Europe, Africaand the Middle East handle high-profile PPPmandates and standout oil, gas and mining work”Projects & Energy – Chambers Global 2014
n “Project Finance Law Firm of the Year”Who's Who Legal Awards 2014
n “Clifford Chance is ‘the only firm with expertise acrossthe multiple legal issues and contracts applicable tothe oil and gas sector”Oil & Gas – Legal 500 2014
n “This team scores high marks with clients forits “depth of talent” and the way in which the“partners and associates make themselves available”and get the job done at the right level of seniority.They are “truly brilliant” at handling big-ticket,complex power and oil and gas matters “Energy & Natural Resources: Oil & Gas – Chambers UK 2013
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Case Study – Reserve Based Financings
Clifford Chance advised the lending banks in connection with a $2bn reserve based lendingfacility to fund the development of Kosmos Energy’s interest in the Jubilee Field in Ghana.
The Jubilee Field is the largest oil discovery in Africa in the last ten years and the Kosmosfinancing was a frontier financing in a country that had never raised debt of thismagnitude. Involving a complex security structure and a range of hedging options, thetransaction has received a number of accolades.
Clifford Chance has continued its pivotal role in assisting oil and gas developments inWest Africa with further reserve based financings in Cote d’Ivoire and Nigeria, as well as anumber of other oil and gas related transactions.
Agriculture
Our experience in the agribusiness sector covers all areasof the agribusiness and food industry including farming,infrastructure, outsourcing and supply chains and logisticsand consequently allows us to help our clients to bestrategic in their investment and financing transactions,operations and management of risk.
Some highlight examples include advising:
n Mondelēz International Inc. on the combination of its global coffee business with D.E.Master Blenders 1753 B.V. (DEMB) to create the world's leading pure-play coffeecompany, with revenues in excess of US$7 billion
n Banco Santander in relation to US$20 million structured trade finance facility forMultigrain AG
n AMRO Bank as arranger of a US$25 million secured pre-export finance facility forBrazilian sugar and ethanol producer Clealco Açúcar e Álcool
n on forward sales of various grains and livestock (and financing those arrangements),as well as numerous farmer to farmer trade sales of significant holdings
n ABN AMRO as arranger of a US$120 million syndicated secured pre-export financefacility for Brazilian sugar and ethanol producer Companhia Nacional de Açúcar e Álcool
n Société Générale as arranger of a US$25 million secured export prepayment facility forBrazilian meat producer Bertin S.A.
n ING Bank N.V. and ABN AMRO Bank N.V. as joint lead arrangers of a US$70 millionsyndicated secured pre-export finance facility for Brazilian sugar and ethanol producerUsina Noroeste Paulista Ltd
n Banco Bradesco S.A. as arranger of a US$50 million secured export prepaymentfacility for Brazilian sugar/ethanol producer Usina Navirai S/A – Açúcar e AlcoolFMO inrelation to the restructuring of a US$150 million secured syndicated pre-export financefacility for Argentine grain exporter Nidera S.A.
n Natexis and ABN AMRO as lead arrangers of US$75 million secured syndicatedpre-export finance faciliy for Federacion Nacional de Cafeteros de Colombia (Caféde Colombia)
n Aquila Capital on the formation of a farmland fund in the form of a Luxembourg SICAV-SIF,the first agriculture fund qualifies as real estate fund from a German regulatory perspective
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n BlackRock on the establishment of its global BlackRockAgriculture Fund
n Hosen Capital on its establishment and the set up ofNew Hope Agriculture and Food Fund II
n PowerShares Exchange Traded Fund Trust as issuer in thelaunching of PowerShares Global Agriculture Portfolio
n Vintage Wine Trust, a US REIT, on its 144A US$150 millionRule 144A/ Reg S/Reg D offering
n The Carlyle Group on the acquisition of a minority stake inExport Trading Group (ETG) as part of a US$210 millionequity financing. This is The Carlyle Group's firstAfrican investment.
n Rabobank on its legally binding MOU with AgriculturalBank of China to establish a strategic partnership toco-operate in various areas of business
n UBS on an agricultural fund to invest into South America
n a group of German investors on their investment in WellsTimberland REIT
n Russian Agricultural Bank on the issue of RUB20 billionfloating rate loan participation notes under theUS$10 billion EMTN Programme
n Rabobank on a US$250 million cornerstone investment inthe Hong Kong IPO of Agricultural Bank of China
n ABN Amro, BNP Paribas, Credit Agricole, ING, RBS,Standard Chartered, Unicredit, SG Americas Securities,Natixis, Rabobank and Lloyds TSB, in relation toUS$1.75 billion working capital facility for BungeFinance Europe
n on the establishment and first acquisition by the HungarianAgricultural and Real Estate Fund
n Algoa on due diligence of agricultural land plots inKaluzhskaya region related to their acquisition and furtherconstruction of farms
n EBRD who alongside Rabobank acquired a 35% stake inBGZ, Poland’s state controlled agricultural bank. The stakewas valued at approximately PLN 1.4 billion
n Russian Agricultural Bank, a Russian open joint stockcompany that is wholly-owned by an agency of thegovernment of the Russian Federation, on its US$1.75billion debt offering
n Russian Agricultural Bank on its programme of issuance ofloan participation notes by RSHB Capital for the purposeof financing loans to Russian Agricultural Bank
n HSBC Corporate Trustee Company as trustee in relation tothe issue of loan participation notes by Classic I(Netherlands) in connection with a loan made by it toRussian Agricultural Bank
n UFG Real Estate Fund on the purchase of an equityinterest in a Russian agriculture project from it’s jointventure partner
n ED&F Man. a sugar and coffee commodity player, on itscorporate financing activities
n Citibank and Credit Suisse in connection with theEuropean aspects of the US-driven €870 million loan andbond financing to be provided to Apollo Management inconnection with its leveraged buyout of TamincoGroup Holdings
n EBRD on RUB4.7 billion loan to John Deere forestablishing its agricultural leasing business in Russia
n UFG Real Estate Fund on the purchase of an equityinterest in a Russian agriculture project from it’s jointventure partner
n funds advised by Permira Advisers LLP on the acquisitionof a stake of up to 61% in Netafim Ltd., a global leadersmart drip and micro irrigation solutions, from theKibbutzim Hatzerim, Yiftach and Magal and Israeli fundsMarkstone and Tene
Key contacts
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Leonard ClelandPartner, Banking & FinanceT: +44 20 7006 2070E: [email protected]
London
James PayPartner, Energy & ResourcesT: +44 20 7006 2625E: [email protected]
London
David GristonPartner, Energy & ResourcesT: +31 20711 9284E: [email protected]
Amsterdam
Logan WrightPartner, Banking & FinanceT: +44 20 7006 2034E: [email protected]
London
Habib MotaniPartner, Banking & FinanceT: +44 20 7006 1718E: [email protected]
London
Russell WellsPartner, Banking & FinanceT: +44 20 7006 2628E: [email protected]
London
Philip HillPartner, InsuranceT: +44 20 7006 8706E: [email protected]
London
Roger BestPartner, Litigation & Dispute ResolutionT: +44 20 7006 1640E: [email protected]
London
Etienne WongPartner, TaxT: +44 20 7006 8825E: [email protected]
London
Oliver HippersonPartner, Banking & Finance (Shipping)T: +44 20 7006 4767E: [email protected]
London
Paget Dare BryanPartner, Banking & FinancingT: +852 2826 2459E: [email protected]
London
Alastair MacAulayPartner, Banking & Finance (Shipping)E: [email protected]
Hong Kong
TieCheng YangPartner, Banking & FinanceT: 86 106535 2265E: [email protected]
China
Paul LandlessPartner, Banking & FinanceT: +65 6410 2235E: [email protected]
Singapore
Mustapha MourahibPartner, Banking & FinanceT: +212 52013 2081E: [email protected]
Casablanca
Timothy CornellCounsel, Corp. AntitrustT: +1 20 2912 5220E: [email protected]
US
Ranbir HunjanPartner, Banking & FinanceT: +44 20 7006 2612E: [email protected]
India/UK
Ross HowardPartner, Banking & FinanceT: +33 14405 5332E: [email protected]
Tokyo
Nikolaï EatwellPartner, Banking & FinanceT: +33 14405 5339E: [email protected]
France
Tim PlewsPartner, Banking & FinanceT: +966 14780 220E: [email protected]
Dubai
Clifford Chance LLP is a limited liability partnership registered in England & Wales under
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word ‘partner’ to refer to a member of Clifford Chance LLP, or an employee or consultant
with equivalent standing and qualifications.www.cliffordchance.com
© Clifford Chance, May 2015
10 Upper Bank Street, London, E14 5JJ
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