December 2008 eBulletin - PRAC · MUNIZ Acts in Purchase of Atacocha NAUTADUTILH Advises the...

► CLAYTON UTZ Advises Grain Pool on $2 Billion Debt Funding ► FRASER MILNER Advises Hunting PLC in sale of Gibson Energy Holdings & Subsidiaries ► GIDE LOYRETTE NOUEL Counsel to the Republic of Mali on the Sale of a Strategic Stake in BIM SA to Attijariwafa Bank ► HOGAN & HARTSON Advises Tata Chemicals Subsidiary in Underwrite Funding of $300M ► KING & WOOD Advises China International Capital Corporation Limited on Jiangxi Copper Co. Bond Issue ► LOVELLS Advises on Merger of Leading UK and US Technology Companies ► MUNIZ Acts in Purchase of Atacocha ► NAUTADUTILH Advises the Belgian government on the KBC Capital Injection ► RODYK Acts in Landmark Casino Ruling on Foreign Gambling Debt Judgment ► SIMPSON GRIERSON Acts for DB Breweries in Sale of Retail Franchise Business ► TOZZINI FREIRE Stock Purchase Agreement Approval Reached for Sale of Andarko Petroleum Corporation Interest in Peregrine Field and Kadkida Unit ► WILMERHALE Five Guantanamo Detainees Ordered Released

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►Baker Botts International Finance Lawyer Joins London Office ►Davis Wright Expands National Industry Practices Adding 22 Lawyers ►Hogan & Hartson Former DOJ Antitrust Division Head Litigator Rejoins Firm ►Luce Forward Continues Corporate Group Expansion ►Morgan Lewis 17 Member Energy Transactions Group Joins New York Office ►Simpson Grierson Announces Partner Promotion ►WilmerHale Expands Securities Litigation & Enforcement Practice in Los Angeles ►TozziniFreire Adds Fortaleza Partner ►AUSTRALIA New South Wales Tightens Contaminated Lands Regulations CLAYTON UTZ ►CANADA Fifth Protocol to the Canada U.S. Income Tax Convention Enters Into Force FRASER MILNER ►CHINA Managing Objections to Patent Amendments that Go Beyond Original Disclosure KING & WOOD ►MEXICO Energy Reform Update SANTAMARINA Y STETA ►NEW ZEALAND Emissions Trading A Change in Political Climate SIMPSON GRIERSON ►SINGAPORE Offering Foreign Collective Investment Schemes in Singapore RODYK & DAVIDSON ►TAIWAN Conditions Relaxed for Overseas Investments in Taiwan LEE & LI ►UNITED STATES Privacy Update SONY BMG Music Pays $1 Million Fine to Settle COPPA Charges HOGAN & HARTSON ►UNITED STATES Massachusetts Releases Proposed Pharmaceutical and Medical Device Manufacturer Code of Conduct WILMER HALE

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December 2008 e-BULLETIN

International Project Finance Lawyer Weston Joins Baker Botts in London; Extensive Experience in Emerging Markets Adds Depth to Firm’s U.K. Office

LONDON, November 3, 2008 -- Rubin Weston has joined Baker Botts as a partner in the firm's Global Projects group. He will be based in the firm’s London office. Weston's practice focuses on project, infrastructure, trade and export finance. Much of his work has involved clients in emerging markets, particularly the countries of the former Soviet Union. Weston acted for EBRD on its financings of the participations of the State Oil Company of Azerbaijan (SOCAR) and Lukoil in the development of the Shah Deniz gas field (off the coast of Azerbaijan) and the South Caucasus Gas Pipeline (which takes gas from this field to markets in Turkey). He also recently represented Interpipe, a major global producer of steel pipes and the second largest producer of forged railway wheels in the world, in respect of financings in an aggregate amount of $531 million provided by Citibank and Barclays for the construction of a new plant in Ukraine. “Adding Rubin Weston to our London office is an important step for the firm toward accomplishing our strategic goal to build one of the strongest project finance teams worldwide,” said Stuart Schaffer, chair of the Global Projects group at Baker Botts. Weston earned an undergraduate degree from the University of Oxford, Brasenose College in 1991 and graduated from The College of Law in London in 1993. Prior to joining Baker Botts, he was a partner in the London office of Chadbourne & Parke. ### About Global Projects at Baker Botts The Global Projects group at Baker Botts is composed of lawyers skilled in various complementary practices that offer clients the range of legal skills and experience needed for sophisticated and complex energy and infrastructure projects and transactions around the world. About Baker Botts L.L.P. Baker Botts L.L.P., dating from 1840, is a leading international law firm with offices in Austin, Beijing, Dallas, Dubai, Hong Kong, Houston, London, Moscow, New York, Palo Alto (California), Riyadh and Washington. With approximately 800 lawyers, Baker Botts provides a full range of legal services to international, national and regional clients. For more information, please visit www.bakerbotts.com

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NEW YORK, December 1, 2008 – Hogan & Hartson LLP announced today that Sanford "Sandy" M. Litvack, having completed his work at the U.S. Department of Justice Antitrust Division (DOJ), has rejoined the firm in the New York office. He will resume his practice focused on antitrust litigation, cartel investigations, internal investigations, commercial litigation, dispute resolution, and corporate governance. He will work closely with the firm’s international offices, especially in Europe. Litvack left the firm following his appointment to assist the Justice Department Antitrust Division in its investigation of the highly publicized proposed Google-Yahoo agreement. Litvack was retained to consult and act as lead trial counsel in any suit brought by the government. However, upon being advised that the Antitrust Division intended to file suit, Google and Yahoo abandoned the proposed transaction. Litvack, who previously served as head of the Antitrust Division, has extensive experience in complex litigation, antitrust, trade regulation, and dispute resolution. “We are thrilled to welcome Sandy back to Hogan & Hartson,” said firm Chairman J. Warren Gorrell, Jr. “As one of the top trial lawyers in the country, he has been an invaluable asset to the firm over the years. We are proud of his work at the Justice Department and are happy that he has decided to return and continue his significant role in our global antitrust and litigation practice.” Commenting on his return to the firm, Litvack said, “It has been a great privilege to work with the excellent lawyers and economists at the Antitrust Division again. With the completion of that task, I am excited to rejoin Hogan & Hartson and to continue to practice with the firm's extremely talented group of antitrust and trial lawyers.” Litvack first joined Hogan & Hartson in 2004. Prior to that time, he held various prominent positions at Walt Disney Company, including Vice Chairman, Chief of Corporate Operations, and General Counsel. During President Carter's Administration, Litvack served as Assistant Attorney General in charge of the Antitrust Division of the DOJ. In 2004-7, he served as a member of the Antitrust Modernization Commission, which undertook a comprehensive review of U.S. antitrust laws. Litvack is a fellow of the American College of Trial Lawyers and serves as a trustee of the Lawyers’ Committee for Civil Rights Under Law. He also is a past Chairman of the Antitrust Law Section of the New York Bar Association. About Hogan & Hartson Hogan & Hartson is an international law firm founded in Washington, D.C., with more than 1,100 lawyers in 27 offices worldwide. The firm has a broad-based national and international practice that cuts across virtually all legal disciplines and industries. Hogan & Hartson has offices in Abu Dhabi, Baltimore, Beijing, Berlin, Boulder, Brussels, Caracas, Colorado Springs, Denver, Geneva, Hong Kong, Houston, London, Los Angeles, Miami, Moscow, Munich, New York, Northern Virginia, Paris, Philadelphia, San Francisco, Shanghai, Silicon Valley, Tokyo, Warsaw, and Washington, D.C. For more information about the firm, visit www.hhlaw.com

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Thirteen partners, three of counsel, four associates further strengthen Puget Sound and national industry practices

SEATTLE – Nineteen lawyers from Heller Ehrman's Seattle office and one from San Francisco have moved to Davis Wright Tremaine. They bring strong practices in corporate, litigation and real estate, and deep industry experience in financial services, energy and hospital-ity, to supplement the more than 200 Puget Sound lawyers and 45 San Francisco lawyers at Davis Wright. More Heller Ehrman Seattle lawyers have chosen Davis Wright than any other firm.

“Our firm strategy is market leadership – in the Northwest as a full-service firm, and nationally in the industries on which we focus most heavily – communications, energy, financial services, health care, hospitality and media,” said Susan Duffy, partner-in-charge of Davis Wright's Seattle office. “This terrific group greatly advances our strategy in many areas.”

“'Platform' is an overused word but the fact is that Davis Wright offers the best platform for us to serve our clients and build our practices,” said Brendan Mangan, former managing partner of Heller Ehrman's Seattle office. “Their skills and areas of focus complement ours ex-tremely well. As important, since many of us have known each other for many years, we know we share common philosophies about client experience, collaboration and community involvement.”

“Both firms have provided great service to us for years,” said Marian Durkin, Senior Vice President and General Counsel of Avista. “It's great that the two teams have come together and can now work with us in a unified way.”

The West Coast lawyers who have joined Davis Wright are:

Partners

Bruce Bjerke (M&A, Hospitality, Energy) Pamela Charles (Tax) Elizabeth Deckman (Employee Benefits) John Hanley (Real Estate, Energy, Financial Services) Brian Hulse (Real Estate, Energy) Matt Le Master (M&A, Hospitality) Scott MacCormack (M&A, Corporate Finance, Energy) Brendan Mangan (IP and Securities Litigation) Leslie Nellermoe (Environmental Litigation) Ken Payson (Class Action, Product Liability, Appellate Litigation) Don Percival (Real Estate, Hospitality) Warren Rheaume (IP, Complex Commercial Litigation) Bernie Russell (M&A, Structured Finance, Financial Services)

Of Counsel Keith Betzina (Employee Benefits, Tax) Jacob Scholl (Business Transactions, M&A, Financial Services) Dave Wilson (Corporate Finance and Securities)

Associates Anthony Caso (Real Estate) Michael Caughey (Business Transactions, Commercial Finance) Donna Cochener (M&A, Securities) Dipa Sudra (Employee Benefits) Continues Next Page

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NEW YORK– Lynn Loacker, a former member of the policy committee at Heller Ehrman and a leading finance and transactional lawyer, has joined the New York City office of Davis Wright Tremaine. Her arrival further boosts that office's recently-enhanced corporate group.

“Lynn is a key piece in our strategy to build a New York corporate practice focused on providing finance and transactional services to the companies we represent in the industries where we are especially strong – media, communications, entertainment, energy, financial services, hospitality and health care,” said Sharon Schneier, partner-in-charge of Davis Wright's New York office. “She is a presence around whom we can continue to build this team.”

Ms. Loacker works with borrowers, issuers, lenders and underwriters in finance and structured investment transactions. She represents companies in the energy, renewable energy, media and financial services industries. She also has strong ties to the Pacific Northwest, having practiced there for 20 years. She represents such leading Northwest companies as Vulcan, JELD-WEN and Plum Creek Timber Company.

“I really believe in Davis Wright's approach of building integrated teams around industries where they are strong,” said Ms. Loacker. “That, plus the energy and dynamism of the firm's New York office and my long relationships with many of their great lawyers, convinced me this is the perfect place from which to serve my clients.”

“Lynn brings our Northwest clients a sophisticated New York presence with Northwest roots that will enable us to serve more of those clients' needs across the country,” said Joe Weinstein, chair of the firm's corporate practice. “Because she has worked with many of us for many years, we know her integration to the firm will be seamless.”

Ms. Loacker has a long history of civic leadership that currently includes serving as Director and Co-Chair of the Strategic Planning Committee of the New York City Opera Company, and on the Board of Advisers of the Seattle Opera Association.

About Davis Wright Tremaine LLP

Davis Wright Tremaine LLP is a national business and litigation law firm with approximately 530 attorneys in nine offices: Seattle and Bellevue (Wash.), Portland (Ore.), Los Angeles, San Francisco, New York, Washington, D.C., Anchorage (Alaska) and Shanghai, China. For additional information visit www.dwt.com

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Luce Forward announced it continues to expand its Orange County office with the addition of experienced business attorney William T. Gay. Gay will join the firm as Of Counsel, practicing in Luce Forward’s business/corporate group. Gay, who was most recently a partner at Gordon & Rees, has more than 20 years of experience representing both domestic and foreign business clients in a number of critical areas. His work includes corporate transactions, securities, real estate, intellectual property and franchising. Having practiced in Tokyo for several years, Gay is fluent in Japanese and frequently works with Japanese and other Pacific Rim companies looking to go public in the U.S., as well as American companies interested in opening operations in Japan or the Pacific Rim. “Bill is an exemplary attorney with a diverse and thriving business practice that will benefit our clients as we continue with our firm-wide plan to strategically grow throughout the state,” said Robert J. Bell, Luce Forward’s managing partner. “He will complement the talented attorneys in our Orange County office and be an asset as we build up our corporate practice.” Luce Forward’s Managing Partner Elect, Kurt L. Kicklighter, is spearheading the implementation of the new strategic plan adopted by the partners at Luce Forward last spring and said, “Bill joining our Orange County office demonstrates our willingness to act on our new strategic plan. We will continue to expand our presence in the key markets for legal services in the State of California.” Gay was selected as one of the Best Lawyers in America in 2006, 2007 and 2008 and has served in a number of leadership roles throughout his career and currently serves on the Board of Governors of the Southern California Chapter of the Japan America Society. Other past positions include Chair and Vice Chair of the California State Bar Association’s Standing Committee on Cyberspace Law and a member of both the International and Technology and Software committees for the American Electronics Association. In addition, he is a frequent speaker and writer regarding issues related to business and the Pacific Rim. “As one of California’s oldest firms, Luce Forward’s work and attorneys have a solid reputation for quality service and overall skill,” Gay said. “I am happy to join its growing Orange County office and be a part of the firm’s exciting future.” Gay is an alumnus of the University of Washington where he received all of his academic degrees including a Master of Laws in Japanese law, a Juris Doctor, a Masters of Business Administration and a Bachelor of Arts. Gay is a member of both the California and Washington State Bar Associations, in addition to being a certified California mediator and a licensed California real estate broker.

For additional information visit www.luce.com

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NEW YORK, NY, November 10, 2008: Solidifying its position as a full-service legal resource for the utilities industry, Morgan Lewis today announced the addition of 17 energy transactional attorneys to its Business and Finance Practice in New York. The attorneys, whose ability to “quickly become part of the team” has been lauded by in-house counsel, add depth to Morgan Lewis’s existing ca-pabilities in energy-focused transactions.

“With its strong client base and national recognition, stretching back to Thelen’s predecessor firm, Reid & Priest, the group comple-ments Morgan Lewis’s long-established, leading regulatory practice,” noted Firm Chair Francis M. Milone in a memo to the firm.

The group’s practice focuses largely on capital markets and transactions in the electric, gas, and nuclear sectors—areas of particu-lar significance to corporate America today, given the growing energy demands of the global economy. They join a Business and Finance team that already spans the United States, Europe, and Asia, with nearly 400 transactional lawyers who focus on a wide variety of areas, including mergers and acquisitions, private equity, finance, and capital markets.

As concerns about climate change drive major investments in renewables, nuclear energy and carbon capture technologies, the firm’s capabilities across the board—regulatory, transactional, and litigation—will serve its clients well.

Eight attorneys will join Morgan Lewis as partners: Doug Davidson was managing partner of Thelen’s New York office and co-chair of the firm’s corporate and securities practice. He focuses his practice on energy finance and regulation, international project finance, corporate and securities law, and acquisitions and divestitures. John Hood focuses his practice on corporate finance, securities law, corporate governance, mergers and acquisitions, joint ven-tures, and general corporate matters, primarily in the energy and utilities industries. Bob Reger concentrates on corporate finance, Securities and Exchange Commission–related matters, corporate governance, mergers and acquisitions, and general corporate matters. He advises investor-owned utilities and underwriting firms, as well as non-U.S. investors in the U.S. markets.

Thomas P. Giblin, Jr., advises clients on a variety of corporate and financial matters, including securities and mergers and acquisi-tions.

Mahendra Churaman practices in the securitization area, particularly utility ratepayer-backed securitizations and private equity. He has also handled securitizations of customer receivables, music, and film royalties, as well as other asset classes.

Walter Godlewski focuses his practice on corporate finance transactions involving energy and utility companies, as well as other corporate transactions, mergers and acquisitions, asset sales, and utility mortgages. He represents both issuers and underwriters in transactions involving public and private securities offerings. Bobbi O’Connor concentrates on corporate finance, securities law, and general corporate matters, focusing on utility clients and underwriters in capital markets transactions. She has been involved in all manner of debt and equity offerings, including private placements and public offerings and lending transactions.

Kim Reisler focuses her practice on finance and securities law matters, representing primarily utility companies and underwriters. She advises clients on equity and debt transactions in both public and private offerings, including utility clients’ ongoing disclosure needs pursuant to the Securities Exchange Act of 1934 and bank facilities.

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Three will join as senior counsel: Bill Baker, who is widely considered one of the senior legal statesmen of the utility industry, advises energy and public utility cli-ents. He focuses his practice on corporate matters, particularly those regarding financing and restructuring, as well as regulatory issues. His practice concentrates on energy and utility regulatory matters. Marc Lasky focuses his practice on regulatory and financial issues relating to energy and utility industries. His matters at Thelen included, among others, the representation of an electric utility before state regulatory commission in all aspects of industry restruc-turing—including introduction of retail choice, stranded cost determination, rates unbundling, development of affiliate relationship standards, and subsequent implementation proceedings.

Steve Kinney practices in the area of debt financing and the rights of creditors. He focuses on the issuance of bonds and deben-tures; the preparation of secured, unsecured, subordinated, and collateral trust indentures; the Trust Indenture Act; asset securitiza-tion; ring fencing; and structured finance.

Another three will join as counsel: Jennifer Goldberg focuses her practice on energy transactions, mergers and acquisitions, and corporate finance transactions. Some of her representative matters include advising in the joint auction sale by an electric utility company of its 1884 MW coal-fired generating facility for $900 million and acting as counsel to underwriters for an electric utility holding company's sale of $4 billion of senior notes.

Michael Connolly focuses his practice on state and federal public utility law, energy policy, and energy- and utility-related transac-tions. In addition, he advises clients on general corporate business and compliance issues. Before joining Thelen, Michael served as vice president for law for GPU Service, Inc.

Maria Ross practices corporate and securities law, with an emphasis on debt financing transactions. She concentrates on various types of utility debt financing; the preparation of secured, unsecured, subordinated, and collateral trust indentures; and the Trust Indenture Act of 1939. Maria represents issuers and trustees with respect to public and private offerings of debt securities.

Also joining Morgan Lewis are three associates—Matthew Murphy, Jonathan Shade, and Anand Shah—all of whom worked with the group at Thelen on a variety of matters.

About Morgan, Lewis & Bockius LLP Morgan Lewis is an international law firm with more than 1,400 lawyers in 22 offices located in Beijing, Boston, Brussels, Chicago, Dallas, Frankfurt, Harrisburg, Houston, Irvine, London, Los Angeles, Miami, Minneapolis, New York, Palo Alto, Paris, Philadelphia, Pittsburgh, Princeton, San Francisco, Tokyo, and Washington, D.C. For more information about Morgan Lewis, please visit www.morganlewis.com

M O R G A N L E W I S C O N T ’ D

Simpson Grierson is delighted to announce the further strengthening of its commercial practice with the promotion of Simon Vannini to partner. Simon has made a significant contribution to Simpson Grierson's Auckland commercial team over the last ten years, with involvement in a number of significant acquisitions and dispositions for local and international clients. His practice also encompasses specialist structuring advice, trading arrangements, private equity and venture capital, and significant IT projects.

"It's important to be seen by clients as a trusted adviser," says Simon. "Someone who can be relied on to bring relevant experience and expertise to bear when required – in essence, becoming an integral part of the client's team."

Simon provides a wide range of commercial advice to software and hardware suppliers, network utilities, and infrastructure companies as well as service providers and major customers in the utilities and technology sectors.

He frequently advises on structuring and funding options, shareholder arrangements, outsourcing, partnering, and joint venture arrangements. Simon also has specialist expertise in guiding clients through significant IT projects, including hardware and software supply, implementation, and support.

For additional information visit www.simpsongrierson.com

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TozziniFreire Advogados has just added Maria José Rossi Jereissati to its group of partners. She has solid experience in corporate law and will be in charge of coordinating the local activities of the firm's Fortaleza office.

Maria José Jereissati was a monitor at the Federal University of Ceará in the discipline of General Theory of Law. Formerly the Attorney General of the State of Ceará, she is currently its Public Prosecutor. Additionally, she was responsible for the legal department of the Jereissati Group for 25 years.

TozziniFreire Advogados is a leading law firm in Brazil and consistently provides exceptional legal expertise to domestic and international companies in a wide variety of business sectors. With 8 fully-owned offices in Brazil (two in São Paulo and one each in Rio de Janeiro, Brasília, Porto Alegre, Fortaleza, Recife and Campinas), TozziniFreire is engaged in all areas of business law and ensures its clients the same outstanding services and one-firm resources in all offices.

Contact Info Maria José Rossi Jereissati T 55 85 3241-3300 [email protected]

For additional information visit www.tozzinifreire.com.br

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Bill Forman Joins WilmerHale as Counsel in its Securities Department WilmerHale is pleased to announce that Bill Forman has joined the firm as Counsel in its Securities Department, where he is a member of the Litigation and Enforcement Practice Group. Mr. Forman is resident in the law firm’s Los Angeles office. Mr. Forman was most recently with Heller Ehrman, where he was affiliated with the securities litigation practice group. His practice focused on representing “Big Four” accounting firms and individual auditors in actions in state and federal court and before the SEC and PCAOB (the Public Company Accounting Oversight Board). Mr. Forman also has extensive experience representing financial institutions, issuers, and directors and officers in private securities litigation and SEC enforcement matters. In addition to his securi-ties practice, Mr. Forman’s experience includes antitrust, trademark, and patent litigation and trial practice. With Mr. Forman’s arrival, four former Heller Ehrman attorneys have joined WilmerHale’s Los Angeles office. Last month, Robert Badal joined as Partner in the firm’s Antitrust and Competition Practice Group, bringing with him over 35 years of antitrust, intellec-tual property and complex litigation experience. In addition, former Heller associates Bethany Stevens and Amanda Walker recently joined WilmerHale as associates in the Litigation and Securities Departments. “Bill’s extensive securities litigation experience, together with his proven ability to litigate and try a wide variety of complex cases, will be a tremendous asset to our clients,” said Randall R. Lee, founding partner of WilmerHale's Los Angeles office. Forman’s experience includes six years as a Deputy Federal Public Defender in the Federal Public Defender’s Office in Los Ange-les. Before that, he was in private practice at Arnold & Porter in Los Angeles. Forman received his JD, cum laude, from Harvard Law School and his AB, summa cum laude, from Princeton University. He is admitted to the bar in California. “I am thrilled to be joining WilmerHale’s preeminent securities litigation and enforcement practice, and I look forward to helping to build and expand that practice on the West Coast,” said Forman. With the addition of Forman, WilmerHale continues the expansion of its securities enforcement and litigation practice on the West Coast. Last month, Patrick Murphy, formerly a branch chief in the Securities and Exchange Commission’s San Francisco office, joined the firm’s Palo Alto office after eight years at the SEC. Palo Alto-based partner Jonathan Shapiro has over a dozen years of securities litigation and enforcement experience. The firm’s Los Angeles office is led by Randall Lee, former Regional Director of the Pacific Regional Office of the SEC and a former Assistant United States Attorney. Opened in October 2007, WilmerHale’s Los Angeles office strengthens and expands the firm’s preeminent securities enforcement, securities litigation, white collar defense, intellectual property litigation, and antitrust and competition practices in southern California and throughout the western United States.

For additional information visit www.wilmerhale.com

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Clayton Utz Perth corporate partner Peter Wilkes has led a team advising specialist grain marketing organisation Grain Pool, a subsidiary of Co-operative Bulk Handling (CBH) Group, in relation to a successful $2 billion capital raising exercise.

Done in conjunction with Azure Capital, the transaction involved the preparation of an information memorandum with respect to the funding proposal, negotiation of detailed terms sheets, com-mitment letters, the appointment of Joint Lead Arrangers for the syndicated facility and subsequent negotiation of facility, secu-rity and security trust and inter creditor arrangements.

The team, which included Rohan Mishra, Nicky Giovkos and Taylia Rocci also worked with Grain Pool on three bilateral in-ventory finance facilities to raise $750 million.

The syndicated facility with Westpac, CBA, NAB, ANZ and RaboBank, for $1.248 billion, was finalised on the last weekend in September.

Peter said that by the end of October Grain Pool had finalised the inventory financing providing total funding of approximately $2 billion.

"The transaction provided a significant volume of debt funding for Grain Pool, giving it the capacity to market and fund virtually the entire Western Australian grain harvest in for 2008 and 2009," he said.

Also commenting on the transaction CBH Group Chief Execu-tive Officer Imre Mencshelyi said: “Securing this amount of funding amid the current global credit crisis is a major achieve-ment and a reflection of our financial strength and credibility.”

For additional information visit www.claytonutz.com


WASHINGTON, D.C., December 3, 2008 – Hogan & Hartson LLP has advised Tata Chemicals’ U.S. subsidiary General Chemical Industrial Products Inc. (GCIP) in the successful completion of a $300 million non-recourse facility. This LIBOR-based facility is without recourse to Tata Chemicals Limited, and is arranged to repay the $350 million bridge loan taken by Valley Holdings Inc., a U.S. subsidiary of Tata Chemicals, for the acquisition of GCIP. The balance of $50 million is to be paid from Tata Chemicals’ internal accruals. The global syndication is expected to be completed in December 2008. The Hogan & Hartson team included New York partner Waajid Siddiqui, Washington, D.C. partner Deborah Staudinger, and Baltimore associates Mark Paul Lehman and Brian Diamond. Standard Chartered Bank led the transaction through a consortium of co-mandated lead arrangers.

For additional information visit www.hhlaw.com

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On December 12, 2008, London-based international energy services company Hunting PLC announced the completion of its sale of Gibson En-ergy Holdings Inc. and its subsidiaries (Gibson) to Gibson Acquisition ULC, a company ultimately owned by the Riverstone/Carlyle Global Energy and Power Fund, an energy focused private equity fund managed by New York-based Riverstone Holdings LLC.

Headquartered in Calgary, Alberta, Gibson is Canada’s largest midstream company, bringing to market crude oil and diluent, natural gas liquids, asphalt and refined products, wellsite fluid products and services, and natural gas through its facilities and substantial infrastructure.

The total consideration for Gibson is C$1,258 million, including C$1,158 million in cash, and financing of C$100M by the Vendor, Hunting, to

assist the purchaser, Gibson Acquisition ULC, by way of a receipt of a warrant entitling the Vendor to C$100 million Preferred Equity Shares in the parent company of the Purchaser on exercise of the Warrant. The Purchaser (or an affiliate of the Purchaser) may purchase the Warrant from Hunting for cash plus a sum equal to any cumulative dividends on the Preferred Equity from the date that the Warrant has been issued.

The total consideration is subject to a deduction for estimated debt within Gibson of C$215 million as at completion and includes estimated net working capital in Gibson of C$158 million at completion, estimates for which values are subject to audit.

Hunting and Gibson were represented in Canada by Fraser Milner Casgrain LLP with a team headed by Laura Safran, Q.C., with Chima Nkemdirim, Dorothy Dawe, Vas Antoniou and Bill Jenkins (securities/commercial), Anne Calverley, Q.C., Derek Kurrant, Jehad Haymour, Sebastian Elawny, Dan Mitsuka and Kevin Scott (tax), Laura Zurowski, John Marner, Christina Winger and Rusty Juma (commercial), Barry Zalmanowitz, Q.C., Matt Sudak, Lars Olthafer and Alex MacWilliam (regulatory), Mike Hurst and Miles Pittman (oil and gas), Scott Sangster (banking) and Jim Rose, Q.C. (litigation). Fraser Milner Casgrain LLP also worked closely with Murray Carey, General Counsel of Gibson and Gibson internal counsel, Sean Wilson. For additional information visit www.fmc-law.com

F R A S E R M I L N E R C A S G R A I N R I V E R S T O N E A C Q U I R E S G I B S O N E N E R G Y H O L D I N G S A N D S U B S I D I A R I E S F R O M H U N T I N G P L C

21 November 2008 The Republic of Mali and Attijariwafa Bank have closed a transaction leading up to the sale of a strategic stake in the capital of the Banque Internationale pour le Mali (BIM SA) to Attijariwafa Bank. This sale of 51% of the shares and voting rights in BIM SA is the outcome of a tendering procedure of which the Moroccan bank, Attijariwafa Bank, was adjudicated the winner in July 2008. The exchange of the transfer documents on 6 November 2008 marked the end of a process which is an illustration of the financial sector privatisation policy implemented by the Mali government through its Financial Sector Development Project. The President of the Republic of Mali, His Excellency Amadou Toumani Touré, was entirely satisfied with the transaction and expressed his pride "in seeing that [the Republic of Mali] has been able to honour a commitment to its financial partners and especially that the procedure adopted has been methodical and transparent". Gide Loyrette Nouel (François Krotoff, Leïla Hubeaut and Romain Régulaire) advised the Republic of Mali throughout the privatisation process. François Krotoff heads a legal team that is very active on the African continent, acting principally in project finance transactions and privatisations but also with a close involvement in the mining, oil and gas industries.

For additional information visit www.gide.com

G I D E L O Y R E T T E N O U E L C O U N S E L T O T H E R E P U B L I C O F M A L I O N T H E S A L E O F A S T R A T E G I C S T A K E I N B I M S A T O A T T I J A R I W A F A B A N K

Jiangxi Copper Company Limited, one of the largest copper producers in China, publicly issued convertible corporate bonds with detachable warrants at the Shanghai Stock Exchange on 22 Sept, 2008. King & Wood acted as legal counsel to the underwriters China International Capital Corporation Limited in this issuance. The aggregate amount of the issued bonds is RMB 6,800,000,000, and the expected total amount of the proceeds raised by the exer-cise of all related warrants will not exceed the amount RMB 6,800,000,000. For additional information visit www.kingandwood.com


K I N G & W O O D A D V I S E S C H I N A I N T E R N A T I O N A L C A P I T A L C O R P O R A T I O N L I M I T E D O N J I A N G X I C O P P E R C O . B O N D I S S U E

45th International PRAC Conference April 25 - 28, 2009

Hosted by Wilmer Cutler Pickering Hale and Dorr LLP Open to all PRAC Member Firms Advance Registration Available

online at www.prac.org

Lovells has advised private equity house Kelso Place Asset Management and its investee company Marshal Holdings Limited, a UK-based leader in email and web content security software and technology, in its merger with 8e6 Corp, a US-based leader in Web filter-ing appliances and technology. The deal closed on 12 November. The newly merged company Marshal8e6 will form the only independent software company capable of securing all forms of internet-based communications streams, including corporate emails, Internet based email services, Web sites and Instant Messaging. Mar-shal8e6 will manage 16 million users in 96 countries worldwide. Operations will be based in the US, England, New Zealand, Taipei and Taiwan. The Lovells team advising was led by corporate of counsel Amit Nayyar and included New York based of counsel Phil Ehrlich, banking senior associate Samantha Hutchinson, corporate associate Michael Stewart and trainees Zip Jila and William Elliott. The joint venture also involved securing US$10 million in equity financing from Updata Partners, a technology focused private equity company. Amit Nayyar said: "This is a significant deal in the Secure Web Gateway market and occurs at a crucial time when email and web based threats are at their height. The newly formed company will provide advanced technology and integrated security for clients."

For additional information visit www.lovells.com

Notes for editor About Lovells With over 3,000 people operating from 26 offices in Asia, Europe and the United States, Lovells is one of the world's leading international law firms. We advise many of the world's largest corporations, financial institutions and governmental organisations. We regularly act on complex, multi jurisdictional transactions as well as some of the most high profile commercial disputes. Lovells (the "firm") is an international legal practice comprising Lovells LLP and its affiliated businesses. Lovells LLP is a limited liability partnership registered in England and Wales with registered number OC323639. Registered office and principal place of business: Atlantic House, Holborn Viaduct, London EC1A 2FG. The word "partner" is used to refer to a member of Lovells LLP, or an employee or consultant with equivalent standing and qualifications, and to a partner, member, em-ployee or consultant in any of its affiliated businesses who has equivalent standing.


L O V E L L S A D V I S E S O N M E R G E R O F L E A D I N G U K A N D U S T E C H N O L O G Y C O M P A N I E S

MUNIZ acted in the purchase of Atacocha's 70% voting shares by Votorantim and its Peruvian affiliate Compañía Minera Milpo S.A.A. The transaction amounted to US$ 117 million. Muniz participated as the purchaser’s legal counsel. (November 2008)

For additional information visit www.munizlaw.com


The Rodyk team led by partner Foo Maw Shen, and comprising partner Daryl Ong and associate Ng Hui Min, successfully represented a Las Vegas casino (Caesar's Palace) in enforcing a US court order for a Singaporean gambler to repay his gambling debt of S$6.3 million. This landmark ruling by the Singapore High Court may have an impact on whether Singapore's future casinos can recover debts from foreigners. For a commentary on the case and additional information, visit www.rodyk.com

N A U T A D U T I L H B R U S S E L S A D V I S E S T H E B E L G I A N G O V E R N M E N T O N T H E K B C C A P I T A L I N J E C T I O N

M U N I Z R A M I R E Z P E R E Z - T A I M A N & L U N A V I C T O R I A A C T S I N P U R C H A S E O F A T A C O C H A

R O D Y K & D A V I D S O N A C T S I N L A N D M A R K C A S I N O R U L I N G O N F O R E I G N G A M B L I N G D E B T J U D G M E N T

NautaDutilh Brussels has advised the Belgian government on its capital injection into the KBC group through the issue of non-transferable, non-voting securities to a value of 3.5 billion euros. These securities will be regarded as core capital (Tier 1) without leading to dilution for existing shareholders. The deal will entitle the Belgian government to appoint two representatives to the Board of Directors of the KBC Group. The NautaDutilh team that advised the Belgian government was led by Dirk Van Gerven.

For additional information visit www.nautadutilh.com

S I M P S O N G R I E R S O N A C T S F O R D B B R E W E R I E S I N S A L E O F R E T A I L F R A N C H I S E B U S I N E S S

Simpson Grierson, led by partner Mike Sage and senior associate David Alizade, acted for DB Breweries on the sale of its retail franchise business, Liquorland, to grocery co-operative Foodstuffs.

Off-premise retailing is no longer core to DB Breweries' business. After a competitive bidding process, New Zealand-owned Foodstuffs was selected as the preferred bidder due to its ability most suitable to own, support and grow the nationwide liquor chain of 70 stores.

DB Breweries Managing Director Brian Blake said, "Liquorland has been a profitable and important part of our portfolio over the years, and as the business wasn't for sale as such, it was critical to us that we found the right partner to ensure Liquorland - both the business and the people - would be in good hands."

The change of ownership took effect on 31 October 2008 and is not expected to affect the retail operations in any way.

For additional information visit www.simpsongrierson.com

TozziniFreire - Brazil National Petroleum Agency approved the sale of Andarko Petroleum Corporation interest in Peregrino field and Kaskida unit The National Petroleum Agency (ANP) has approved the sale of Anadarko Petroleum Corporation’s 50-percent interest in the Pere-grino field offshore Brazil and its 25-percent interest in the BP-operated Kaskida Unit in the deepwater Gulf of Mexico to StatoilHydro. Estimated value of the deal is US$ 1.8 billion plus additional consideration valued at $ 300 million.

Date of execution of the Stock Purchase Agreement March 4, 2008; ANP approval December 11.

Lawyers of TozziniFreire acting in transaction- Luiz Antonio Maia Espínola de Lemos – Partner ; Gustavo Pequeno Peretti - Associate; Luis Antonio Menezes da Silva – Associate For additional information visit www.tozzinifreire.com


SEOUL 2007

October 20-24

PRAC Conference Materials Available online at www.prac.org

PRAC e-Bulletin is published monthly.

Member Firms are encouraged to contribute articles for

future consideration. Send to [email protected].

Deadline is 10th of each month.

T O Z Z I N I F R E I R E S T O C K P U R C H A S E A G R E E M E N T A P P R O V A L R E A C H E D F O R S A L E O F A N D A R K O P E T R O L E U M C O R P O R A T I O N I N T E R E S T I N P E R E G R I N E F I E L D A N D K A S K I D A U N I T


November 20, 2008 A federal court today upheld the claim of five Bosnian-Algerian men that the US Government had no lawful basis for imprisoning them at Guantanamo Bay, where they have been held for nearly seven years. US District Court Judge Richard J. Leon ruled in favor of Lakhdar Boumediene, Mustafa Ait Idir, Hadj Boudella, Saber Lahmar, and Mohamed Nechla who were represented on a pro bono basis by a team of attorneys from WilmerHale. However, Judge Leon reached the opposite conclusion as to Belkacem Bensayah, finding that the US gov-ernment could continue to detain him as an "enemy combatant”—a ruling WilmerHale attorneys vowed to appeal. In granting the writ of habeas corpus and ordering the release of the five men, Judge Leon took the extraordinary step of urging the Govern-ment not to appeal. Judge Leon urged the heads of the Justice Department, the Department of Defense, and the Central Intelligence Agency to "take a hard look at the evidence both presented and lacking," and stated that seven years of imprisonment was "more than plenty." Today’s decision came after years of pro bono efforts by scores of WilmerHale attorneys and staff members on behalf of the six men de-tained in Guantanamo Bay. The ruling was the next step in the case of Boumediene v. Bush, the Supreme Court case in which WilmerHale partner Seth Waxman argued for, and won, the right of individuals detained at Guantanamo to seek habeas corpus.The firm’s efforts will continue as the appeals process goes forward, with the Government still insisting that the men should be detained, and WilmerHale working to ensure that all six of its clients are freed. "We’re immensely gratified that a habeas court has spoken so decisively and so eloquently about the need for these men to be freed imme-diately," said WilmerHale Partner Stephen Oleskey, a leader of the case team that secured today's ruling. Now in their seventh year of indefinite detention by the US military, the six men hardly fit the profile of dangerous terrorists or “enemy com-batants.” They have wives and children, most worked for charities in Bosnia, thousands of miles from the battlefield in Afghanistan, and not one had directly participated in any hostilities against the United States. They have long insisted that their detention was a grave error that implicated the highest levels of the Bush administration. Their argument gathered even more force when, shortly before trial, the Govern-ment abandoned the claim that initially led to the men's arrest and transportation to Guantanamo—the accusation, recited by President Bush in his 2002 State of the Union Address, that the men were part of a supposed plot to blow up the United States embassy in Sara-jevo.With that accusation no longer part of the case, the government has essentially argued that the men were planning to travel from Bos-nia to Afghanistan at some point in the future and support the Taliban or Al-Qaeda.One of the men, Bensayah, was also accused of being a member and “facilitator” for Al-Qaeda. Judge Leon held that credible and reliable evidence supported Bensayah's continued detention. The victory represents a major advance in the largest pro bono effort in the history of a firm that has distinguished itself as a leader in pro bono representation.Two WilmerHale partners, Stephen Oleskey and Robert Kirsch, have led this impressive effort, marshaling a team of attorneys from the firm’s United States and European offices. Nearly 30 attorneys have contributed hundreds—in some cases thousands—of hours of work on behalf of the imprisoned men.The case has led the team on nearly a dozen visits to Guantanamo Bay and on investiga-tory visits to Bosnia; has prompted meetings with government officials of various countries, both in Washington and Europe; and has led to numerous court filings in US courts in Washington, DC and Boston and in the European Court of Human Rights in Strasbourg, France. At times over the past four years, WilmerHale's decision to represent these six men has been the subject of criticism from various quarters, including those who have prejudged all Guantanamo detainees to be "the worst of the worst" and view the representation of Guantanamo detainees in habeas proceedings as an inherently suspicious enterprise. Notwithstanding these challenges, and inspired in no small part by the firm’s pro bono legacy—including its historic defense of the United States Army against Sen. Joseph R. McCarthy's allegations of Com-munist infiltration, which hastened the demise of McCarthy's Communist witch-hunts—WilmerHale has never wavered in its commitment to its clients. Critical documents in the case, including the prisoners' legal brief and the Petitioners' Public Traverse, which provides the factual back-ground for the men's imprisonment, are available at http://www.wilmerhale.com/boumediene.

For more information visit www.wilmerhale.com

W I L M E R H A L E F I V E G U A N T A N A M O D E T A I N E E S O R D E R E D R E L E A S E D

alert 04 December 2008

New South Wales has just signif icant ly t ightened its regulat ion of contaminated land, so i f you current ly own, occupy, or have impacts on land which could potential ly be contaminated, or you ever have done in the past, or are proposing to do so in future, you wil l need to review your obl igations and exposure to investigate or clean up the land.

The changes in the Contaminated Land Management Amendment Bi l l 2008 were passed by Parl iament on Tuesday, 2 December and include:

an expanded defini t ion of persons responsible for contamination - and those "responsible for contamination" wil l continue to be responsible as far as the Act is concerned, even i f they have made a contract or other arrangement which says another person is responsible widening the duty to report contamination - i f you reasonably ought to have known about contamination (for example, i f you could have reasonably sought advice that would have made you aware of the contaminat ion) you must report i t a new test for the EPA's power to regulate - the object ive "signif icant r isk of harm" test wi l l be replaced by a more subjective test of whether the EPA considers the contamination is "signif icant enough to warrant regulat ion" new powers al lowing the EPA to require a broad range of persons to carry out prel iminary investigat ion, even i f the EPA hasn't determined there is contamination that is "signif icant enough to warrant regulation" removing the "no knowledge" defence for managers/directors new offset arrangements between the Minister and a pol luter ( for example, provision of community services or the establ ishment of environmental or resource projects) where, in the opinion of the Minister, i t is in the public interest and i t would not be practicable to remediate the contamination within a reasonable t ime; and greater penalt ies for fai lure to comply with management orders or the duty to not i fy the EPA.

We looked at the Bi l l in-depth herehttp:/ /www.claytonutz.com/areas_of_law/control ler.asp?aolstr ing=54&na=1810

Now that the Bi l l has been passed, you wil l need to consider:

could your business' past activ i t ies make i t "responsible for contamination"? are you on notice of facts which could require your company to investigate and/or report contamination to the EPA? can the EPA require you to conduct investigat ions or conduct remediat ion under the new laws, where i t couldn't require you to do so under the current laws? should you be expanding your contaminated land due di l igence?

Disclaimer Clayton Utz News Alert is intended to prov ide commentary and general informat ion. I t should not be re l ied upon as legal advice. Formal legal advice should be sought in part icu lar t ransact ions or on mat ters of interest ar is ing f rom this bul let in . Persons l is ted may not be admit ted in a l l states.

Greater responsibility for anyone connected with contaminated NSW land

For more information please contact:

...

Name: Andrew Poulos - Partner SydneyTel: +61 2 9353 4195Fax: +61 2 8220 6700Email: [email protected]

Name: Brendan Bateman - Partner SydneyTel: +61 2 9353 4224Fax: +61 2 8220 6700Email: [email protected]

Name: Peter Briggs - Partner SydneyTel: +61 2 9353 4225Fax: +61 2 8220 6700Email: [email protected]

Name: Nick Thomas - Partner SydneyTel: +61 2 9353 4751Fax: +61 2 8220 6700Email: [email protected]

Name: Claire Smith - Senior Associate Sydney

Tel: +61 2 9353 4713Fax: +61 2 8220 6700Email: [email protected]

Fifth Protocol to the Canada-U.S. Income Tax Convention Enters into Force

By Christopher J. Steeves

December 15, 2008

Canada’s Department of Finance and the U.S. Department of the Treasury each announced the entry into force of the fifth Protocol amending the Canada-U.S. Income Tax Convention (the"Treaty") today. The Protocol which was first signed on September 21, 2007 brings into effect a number of significant new measures which will impact on cross border tax matters.

Today’s announcement means that some of the changes to the Treaty will have immediate effect (or even retroactive application for 2008) while other changes to the Treaty are to be phased-in over time based on today’s entry into force. The following is a brief description of some of the important changes to the Treaty and the relevant dates when these changes will apply.

Withholding Taxes on Interest

In 2007, Canada introduced domestic legislation to eliminate the withholding tax on interest payments made after December 31, 2007 except with respect to interest payments to non-arm’slength or related party lenders and with respect to interest that is computed by reference to sales, income, profits or cash flow of the debtor (so-called participating debt). As a result of the Protocol, Article XI of the Treaty was amended to provide that interest paid to related party lenders resident in the U.S. (other than participating debt interest) will also be exempt from Canadian withholding tax. This change will be phased-in, as follows. For 2008, the rate of withholding tax for related party lenders will be reduced from the current Treaty rate of 10% to 7%. This means that relatedparty interest payments received by U.S. residents in 2008 that were subject to 10% Canadianwithholding taxes prior to today will be entitled to claim a refund for the 3% overpayment. The applicable withholding tax rate for 2009 will be 4% and 0% for 2010 and beyond. The rest of the changes to Article XI (including the participating debt exception that is somewhat narrower thanthe exception provided for in the Income Tax Act (Canada) (the "Act")) will have effect on February

1st, 2009.

Fiscally Transparent and Hybrid Entities

The fifth Protocol contains new rules which apply to fiscally transparent and hybrid entities. These new rules are among the most welcome amendments to the Treaty as well as the most controversial. The changes which extend Treaty benefits to limited liability companies will apply for taxable years that begin after 2008. For U.S. resident shareholders of Canadian unlimited liability corporations, the new rules will restrict the availability of certain Treaty benefits as of January 1,2010.

Mandatory Arbitration

Amendments to the mutual agreement procedures in the Treaty provided for in the Protocol are now effective. These changes provide for mandatory arbitration in circumstances where the competent authorities (the Canada Revenue Agency and the Internal Revenue Service) have been unable to resolve a cross-border tax issue; for example, disputes arising from transfer pricing adjustments. Under these new rules, arbitration proceedings are generally to begin two years after the information relating to the dispute has been provided by the taxpayer to both competent authorities, unless they have previously agreed to a different date. This requirement will apply to cases already under consideration by the competent authorities but with the two year time period described above commencing today.

Limitation of Benefits

The expanded limitation of benefits provisions added to Article XXIXA of the Treaty by the Protocol will have a significant impact on cross-border tax matters by limiting the availability of Treaty benefits to "qualifying persons". These amendments reflect Canada’s new approach to restricting treaty shopping after failing to persuade the Canadian courts to do so by applying existing provisions of the Act. These new restrictions will apply after January 31, 2009 in respect of withholding taxes and will apply to taxable years which begin after December 31, 2008 in respect of other taxes.

If you have any questions or would like further information, please contact a member of our Tax Group.

This newsletter is designed to supply brief details of recent case law, legislative and other initiatives as well as some

commentary. The summaries and comments are, of necessity, brief and should not be relied upon as legal advice. We

encourage you to contact any of the lawyers above for further details or advice in the context of a particular situation.

November 2008

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Managing Objections to Patent Amendments That Go Beyond Original Disclosure

By Su Juan* Since last year, patent examiners of the State Intellectual Property Office (“SIPO”) have become more and more cautious when deciding whether amendments to application documents may be accepted. If the application documents are amended in response to the first office action, the subsequent second office action might possibly point out that the amendments can not be accepted on the grounds that they go beyond the disclosure scope contained in the original documents (“original disclosure”). As prescribed in Article 33 of the PRC Patent Law (“Patent Law”)1

An applicant may amend his or its application for a patent, but the amendment to the application for a patent for invention or utility model may not exceed the scope of the disclosure contained in the initial description and claims, and the amendment to the application for a patent for design may not exceed the scope of the disclosure as shown in the initial drawings or photographs.

Based this general rule, any amendment to the description, drawings and claims that does not comply with Article 33 of the Patent Law will not be accepted by the patent examiner. More specifically, the amendments shall not be accepted, if the contents of the application documents amended by addition, alteration and/or deletion include information which causes those skilled in the art, to believe that such information is different from the original, and can not be determined directly and undoubtedly from the disclosure contained in the original documents. However, recent cases show that the amendments are likely not to be accepted by the examiners unless such amendments are described definitely or completely the same as those in the original application documents. In terms of the cases amended in response to the first office action, approximately up to 50% of them receive consequent second office actions pointing out that the amendments can not be accepted for exceeding the original disclosure. Such strict criterion seems to have deviated from the provision of Article 33 of the Patent Law and leaves the applicant at a loss for further action. Once the second action is released, it is too late for any remedy to the original application. The followings are possible steps and strategies as to how to react to the office actions, using the amendments to the claims as an example. First, whether the examiner’s opinions contain any error should be considered. If the examiner’s opinions are impeccable, then the amended contents are actually inconsistent with the initial disclosure and can not be derived directly and undoubtedly from the initial disclosure; the applicant must further amend the application documents and ensure that the new amendments comply with Article 33 of the Patent Law and therefore overcome the defects stated in the first office action. However, the examiners opinions might be wrong if they do not really understand the essence of the invention, or did not study the initial application thoroughly. At this point, reasonable and convincing arguments should be provided in the observations. In practice, some examiners do reject the amendments within the original disclosure because they do not read the documents carefully. 1 The Patent Law of People’s Republic of China was adopted at the Fourth Session of the Standing Committee of the Sixth National People's Congress (NPC) on March 12, 1984. The first amendments were adopted on the 27th Session of the Standing Committee of the Seventh NPC on September 4, 1992. The second amendments were adopted on the 17th Session of the Standing Committee of the Ninth National People's Congress on August 25, 2000. The third proposed amendments of the law started from April 2005 and are expected to be promulgated in the first half of 2009.

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Practically, the examiner’s opinions may contain errors if the examiner ignores the following matters.

1. The amended contents are definitely described in the original application documents but in different parts. In such a case, since the amended contents are not described as a whole in the same position in the description or the claims, some examiners often issue their opinions imprudently. As such, the responding observations should indicate explicitly not only each of the positions of the separate features but also the interrelation within the original application documents. In other words, it should be emphasized that the combination of these features does not exceed the original disclosure. The examiner sometimes also ignores the information included in the drawings. As part of the description, the information disclosed in the drawings is within the original disclosure. That may be employed advantageously since the drawings generally illustrate the interrelations between the features, including dimension, time and functionality relationships and the like. If the amended contents are not described definitely in the description, their supports by the drawings should be grasped. In the case that the drawings show the amended contents, even if the relevant contents are found in the description, the applicant’s supports from the drawings should also be indicated in the observations. 2. The amended contents are disclosed definitely in the original application documents, yet without the full expressions regarding the technical features but with specific structural features being stated in the embodiments. This usually happens in situations where generic concepts are used in the amended claims to generalize relatively wide protection scopes; however, the original application documents only comprise the generic concepts without definite expressions of the features generalized in original application, but specific structures being stated in the embodiments. For instance, the initial application describes the terms of “the first member” and “the second member”; the embodiments describe the feature of “the longitudinal rod and the cross rod form an angle”, and the amended claim defines the feature of “the first member and the second member form an angle”. Since the original application documents do not contain the full expression as the amended feature, in the observations, indication must be given by way of example that the “longitudinal rod” is the “first member”, and the “cross rod” is the “second member” and such contents can be obtained directly and exclusively from the original documents. 3. The contents amended by deleting certain features from an independent claim are not described definitely in the original documents. Generally, during the substantive examination, deleting technical feature(s) from an independent claim means expanding the protection scope, which is usually not permitted. However, there is no such limitation to the amendments made by virtue of voluntary amendment. If the technical solution of an independent claim amended by deleting certain technical feature(s) is not described definitely in the original documents, the examiner usually issues opinions regarding the amendments exceeding the original documents. In such cases, the most convincing argument is that the deleted feature(s) is not an indispensable technical feature(s) of the invention which is described in the description, and the technical solution without this feature can still achieve the aim of the invention; or that the deleted content is not a term in connection with the technical solution of the present invention or the technical feature falling into the specific application scope as described in the description. For example, the original claim defines “a seal for pumps …”, the amended claim defines “a seal”, and the original description does not describe that the seal may be used for any apparatus. Consequently, the amendment can

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not be permitted. In contrast, if the original description indicates that the seal may be used for not only a pump but also any apparatus that needs to be sealed, arguments may be provided based on such disclosure. 4. Translation errors in international applications After an international patent application enters into Chinese national phase, it is treated equally as a regular Chinese national application. The text of the international publication of an international application shall determine its original disclosure. During the substantive examination in the national phase, the examiner examines the Chinese translation, including the translation of the initial publication documents and the translation of the amendments made in the international phase required as examination basis or the amendments made after the application entering the national phase. Examiners will not pass on the examination on these issues even if the amendment has been held acceptable and within the original disclosure during the international phase. In the past, when the contents of an international application exceed the original scope of the disclosure due to translation errors, it is easy to go through the formality to correct translation errors, either voluntarily or upon request, before the grant of the patent application. But the new Guidelines for Examination2 impose more restrictions to prevent the abuse of the right. Now corrections to the translation errors are only allowed to be made where few terms, sentences, or paragraphs of the translation text are omitted or inaccurate compared with the original text transferred by the International Bureau of the WIPO. Once the patent right is granted, there is no chance to rectify the translation error. In conclusion, application documents should be drafted in as much detail as possible, and applications in a language other than Chinese should be translated carefully with high quality. Otherwise, some errors can not be rectified due to the contents exceeding the disclosure contained in the original application documents. The foregoings are examples which applicants usually encounter. In specific cases, specific analyses shall be made. Overall, the original documents used for judging whether an amendment exceeds the original disclosure include description, appended drawings and the claims. Therefore, the claims shall be employed sufficiently. More specifically, the protection scope of an independent claim should be as wide as possible, and the number of dependent claims should be as many as possible, including all possible solutions conceived, to avoid the situation that the contents amended in the examination procedure are not described in the original documents. To minimize additional fee3, the least number of claims should be submitted on the filing date, and other claims may be added by virtue of voluntary amendment on the basis that the technical solutions of the added claims have been described definitely in the submitted description. However, often voluntary amended contents are examined in an increasingly strict manner, and are often objected as exceeding the disclosure contained in the original documents in the First Office Action. The same examination scrutiny is now being applied to the amendments under Article 34 of the Patent Coordination Treaty (“PCT”) which have been accepted in the international phase.

(This article was originally written in Chinese, the English version is a translation.) 2 The new Guidelines for Examination was effective as of July 1, 2007. 3 In China, some patent agents may charge additional fee if an applicant document includes more than 10 claims.

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*Su Juan is a partner at King & Wood’s Patent Group in Beijing.

L E G A L U P D A T E

November 11, 2008

ENERGY REFORM

Since the President of the Mexican Republic, Felipe Calderon Hinojosa, presented to the Senate on April 8, 2008 five initiatives for the energy sector, comprising four projects of amendments to existing laws, and a new law creating an oil commission, some political parties and senators presented new initiatives on the matter, including the initiative by the Partido Revolucionario Institucional (PRI) for the creation of a Law for the Financing of Energy Transition and one by the Partido Verde Ecologista de México (PVEM) for the creation of a Law for Renewable Energy.

Due to coincidences among both initiatives, only one project was issued, named the Law for the Use of Renewable Energy and the Financing of Energy Transition.

Other initiatives were promoted specifically in the oil sector, including the President’s initiatives. These were the reason to hold twenty one debate forums in seventy two days, in which experts in energy matters discussed their respective opinions on the initiatives, including constitutional aspects.

Thus, on October 28, 2008, the House of Representatives approved by majority a controversial energy reform which, according to some analysts, does not solve the challenge to strength PEMEX (Petróleos Mexicanos) as required, even though it was probably the only doable reform within the current political. Time will tell if such reform attracts the investment required and increases oil production.

PEMEX will remain as the head of the oil monopoly, even though with broader autonomy. One of the most controversial points in the President’s original initiative remains unsolved, as refineries will not be allowed to be operated by private parties, and the problem of importation of gasoline is likely to increase in the near future.

The new legislation will enable PEMEX to execute contracts for work and services with private companies, just as it currently does, but with the obtaining of incentives; in this respect, it is likely that international oil companies were rather expecting to obtain a percentage in oil production under the so called risk contracts, a common practice in the international oil industry, but still forbidden under our legal framework.

The reform on the oil sector allows the execution of contracts with incentives, with the expectation of being attractive to international companies, specifically for deep waters exploitation, inasmuch as PEMEX lacks the technology required to carry out such works, allowing private contractors to participate in this business.

2 Under these premises, the energy reform includes:

• Law for the Use of Renewable Energy and the Financing of Energy

Transition

The purpose of this law is to regulate the use of renewable energy sources and clean technologies to generate electricity with purposes other than electricity public service, and establish the national strategy for the financing of energy transition.

The purpose of this law excludes radioactive materials, hydraulic energy from sources exceeding 30 MW, industrial waste or any other kind when incinerated or receiving any other kind of thermal treatment, and the use of landfills against environmental laws.

According to article 4 of the law, the use of water bodies, bioenergetics, wind and geothermal resources, as well as exploitation of minerals associated with geothermal deposits for the production of electricity, will be subject to applicable provisions.

The Federal Executive, acting though the Ministry of Energy (Secretaría de Energía or SENER) supported by the Energy Regulatory Commission (Comisión Reguladora de Energía or CRE) is in charge of regulating electricity generated from renewable energy.

This initiative both encourages the use of renewable energy and cogeneration, and is expected to ensure electricity generation through clean and renewable sources.

This law is expected to encourage in an efficient manner self supply and cogeneration, allowing local and regional communities to participate, ensuring ecological benefits.

The CRE shall issue regulation, methodologies and other administrative rules applying to electricity generation from renewable energy, issuing guidelines for contracts between suppliers and generators using this kind of energy.

• Regulatory Law of Constitutional Article 27 in Oil Matters

Within the amendments to this law, the inclusion of the concept cross border oilfields stands out in the first article, clearly defined as those located within the Mexican jurisdiction with physical continuity out of such jurisdiction.

The law also considers cross border oilfields those located outside the Mexican jurisdiction that are shared with other countries pursuant to treaties signed by Mexico or pursuant to the United Nations Convention on the Law of the Sea.

Activities opened to the private sector pointed by article 4 include gas associated to mineral coal deposits, which will be subject to applicable provisions regarding gas transport, storage and distribution.

Amendments to this law keep the nationalist principle regarding ownership of hydrocarbons and participation by the private sector in oil industry under contracts with considerations being paid in cash only, forbidding PEMEX from submitting to foreign jurisdictions; however, such contracts may include arbitration clauses.

In accordance with amendments proposed for other laws of the oil industry and the creation of the National Hydrocarbons Commission, article 11 of the law provides that SENER (with the participation of the National Hydrocarbons Commission and CRE) will establish regulation of the oil industry and related activities referred to in this law.

3 It also includes the joint participation of the Ministry of the Environment (Secretaría de Medio Ambiente y Recursos Naturales or SEMARNAT) and SENER to establish specifications for gasoline and other liquid fuels deriving from oil refinement.

Article 15 sets forth obligations of PEMEX concerning oil activities, first hand sales and obligations applicable to concessionaires.

The legislator tried to bring legal certainty on the scope of contracts that PEMEX is allowed to enter into, and considerations payable thereunder. Historically, PEMEX has been able to enter into contracts without sharing profits or granting a share of extracted oil to suppliers or contractors. Amendments to article 6 specify that considerations payable may not refer to product percentages.

• Law of Petróleos Mexicanos

This law increases the number of members of the board of directors from eleven to fifteen (six of which shall be appointed by the Executive, in addition to four professional members also to be appointed by the Executive and approved by the Senate, plus five representatives of the oil union).

Pursuant to article 22, seven new committees are created for PEMEX: Audit and Performance Evaluation Committee; Strategy and Investments Committee; Remuneration Committee; Acquisitions, Works and Services Committee; Environment and Sustainable Development Committee; Accountability Committee, and Technology Development and Investigation Committee.

The Acquisitions, Works and Services Committee will be entitled to resolve on exceptions to public bids.

This law includes a specific section for citizen’s bonds, whose holders will be individuals and Mexican pension and retirement funds, mutual funds and other financial intermediaries.

The Ministry of Finance and Public Credit (Secretaría de Hacienda y Crédito Público or SHCP), will provide specific measures with a view to promote access to individuals and limits on individual positions,. An individual will not be able to acquire more than 0.1 percent of the issue.

These bonds will be subject to PEMEX performance and will not confer any decision making authority. Funds obtained by PEMEX will be used exclusively to finance productive works and refinance existing debt.

PEMEX holds broader autonomy to manage its financial situation. Prior approval from the board of directors, PEMEX will be able to increase its budget based on own income excess as long as it achieves annual objectives and the budget for personal services is not increased.

Acquisitions services and public works related to fundamental activities of PEMEX will by general rule be carried out through by public bid processes.

Pursuant to article 61 of the law, PEMEX will be allowed to enter into contracts with additional considerations and the service providers and contractors will be penalised for environmental damage.

PEMEX is expected to be able to supply and offer long term contracts to the national fertilizer industry and ammonia distributors, including fixed prices for inputs in this industry.

It is expected that this law will give PEMEX more administrative options to manage its debt.

An innovation was to include the citizen bonds. Holders will get interests according to PEMEX performance, and not a participation in the profits.

4 With approved reforms, fertilizer producers will benefit, being the natural gas the raw material for the ammonia synthesis, with a direct connection between the prices of both products. At the same time, ammonia price has a direct impact on production costs of nitrogen fertilizers. This reform is expected to allow the Federal Government to guarantee input supply at steady prices to fertilizer producers through long term contracts.

• Law of the Energy Regulatory Commission

CRE will now have, besides technical and operative autonomy, negotiation and decision autonomy in terms of this law.

Additionally, CRE will have the power to approve terms and conditions applicable to first hand sale prices of gas, oil derivatives and basic petrochemical products, as well as to establish methodologies for price determination.

CRE will regulate the transportation and distribution of gas, products obtained from oil refining and basic petrochemicals, to be carried out through pipeline, as well as storage systems connected to pipeline transportation or distribution, or forming part of import and distribution terminals.

Proposed amendments broaden and renew the purpose of this organism. Now, CRE will promote the efficient development of: (i) first hand sales of gas, oil fuels and basic petrochemicals; (ii) transportation and distribution of gas, products obtained from oil refining and basic petrochemicals, which is performed though pipelines, as well as storage systems directly connected to pipeline transportation and distribution or forming part of import and distribution terminals, and (iii) biofuels transport and distribution through pipeline, the storage thereof directly connected to pipeline transportation or distribution and import and distribution terminals.

These modifications are expected to allow CRE’s regulatory activities to be more efficient in the context of governmental participation for development of the energy sector.

The regulation of the aforesaid activities will bring more legal certainty to participants according to guidelines and terms and conditions approved by CRE for these services.

• Organic Law of the Federal Public Administration

With the reform of article 33 of this law, SENER will have the authority required to establish and lead the national energy policy and supervise performance. Energy security and diversification, energy saving and environmental protection are regarded priorities, SENER being able to coordinate, implement and promote related projects and studies.

Likewise, SENER will lead and supervise the activities of governmental entities and the programming of exploration, exploitation and transformation of hydrocarbons, along with the generation of electric and nuclear energy.

SENER is expected to have a closer connection in the promotion of private participation, and shall issue regulation on the determination of areas for oil exploration and exploitation and the granting of permits for surface recognition and exploration, supervising performance and establishing the policies for restitution of hydrocarbon reserves.

Amendments to article 33 of this the law allows SENER to participate in programming hydrocarbon exploration, exploitation and transformation, and the generation of electric and nuclear energy.

SENER will be in charge of the energy strategic planning in the medium and long term, taking into

5 consideration population basic energy needs, environmental impact and national technology development aspects.

The new authority of SENER is not expected to have an impact on the federal budget.

• Law for the National Hydrocarbons Commission

The Senate approved the creation of the National Hydrocarbons Commission as a decentralized agency of the Federal Government. It will be integrated by five commissioners (one of them will be the president), and its main purpose will be to regulate and supervise exploration and exploitation of hydrocarbon in cloaks and oilfields, as well as the processing, transport and storage activities directly related to hydrocarbon exploration and extraction projects.

The authority of the Commission includes to technically approve hydrocarbon exploration and exploitation projects, previous assignment by SENER. It shall also establish evaluation mechanisms of operative efficiency in the exploration and exploitation of hydrocarbon and will prepare technical proposals to optimise recovery factors in hydrocarbon extraction projects.

Likewise, the Commission will manage and analyze information regarding crude oil and natural gas production, reserves, prospective resources, geological and geophysical information or any other index required to perform its duties, and will carry out evaluation studies, verify oil reserves, requesting all information required, issuing instructions for PEMEX to provide information on exploration and extraction projects as required by the Commission.

This agency will play an important role in the objective of strengthening PEMEX, by regulating and supervising exploration and exploitation projects. It will establish technical guidelines to be observed in design of exploration and extraction projects, increasing oil rents and replacing hydrocarbon reserves.

Also important for PEMEX will be the opinions issued on the assignment or cancellation of areas for exploration and exploitation purposes, as well as on permits for recognition and surface exploration to search for oil possibilities.

• Law for a Sustainable Use of Energy

The purpose of this law is to promote an optimal use of energy in all processes and activities, from exploitation to consumption. It is expected that civil organizations, the private sector and the population in general will participate in achieving said purpose.

The Federal Executive will incorporate objectives and strategies for the sustainable use of energy. In compliance with this law, agencies of the federal administration will be required to observe a National Program for the Sustainable Use of Energy.

The Program will establish strategies, objectives and actions allowing an optimal use of energy.

This law creates the National Commission for the Efficient Use of Energy, an administrative agency with the purpose of promoting energy efficiency. It will be a technical entity engaged in the sustainable use of energy with authority to issue and propose Mexican official norms regulation and national programs for energy efficiency and establish and evaluate objective achievement, among other activities. In conclusion, the proposed reforms consider a fundamental purpose try to strengthen the Mexican oil industry and PEMEX.

The proposed reforms observe the constitutional principles regarding hydrocarbon, a strategic area in charge of PEMEX, who will continue with exploitation activities on an exclusive basis.

6 It may be anticipated that these reforms will not show results in the near future, although broader autonomy for PEMEX will be appreciated.

As for renewable energy, the new law is considered a big step to promote the generation of electricity through clean and renewable sources.

Mexico faced a considerable legal and political challenge that in the end managed to join some differences into coincidences. The strengthening of PEMEX and the creation of solid institutions with a legal framework promoting the energy sector and trying to afford legal certainty to private participants in certain activities stand out among the objectives of a reform whose results will be tested in light of growing challenges in the sector. For additional information visit Santamarina y Steta at www.s-s-com.mx

includes looking at the merits of an ETS, as opposed to a carbon tax, and the timing of any future climate change interventions. Other key issues likely to come under the microscope in the pending debate around an ETS for New Zealand include:

• balancing New Zealand's environmental and economic interests; • alignment with the proposed Australian emissions trading regime,

described as a Carbon Pollution Reduction Scheme; • balancing interests of government and business, specifically the

need for fiscal neutrality; and • avoiding an exodus of business, through encouraging use of new technology, keeping industry obligations in line with foreign competitors and recognising the importance of small and medium enterprises. In the remainder of this FYI we provide an overview of the key features of the New Zealand ETS as currently enacted. Who does the ETS apply to? As enacted, the ETS does not apply to every

person or business that emits greenhouse gases. Only those who undertake one or more of the specified compliance activities are mandatory participants under the ETS and subject to the compliance obligations. A compliance activity may not be the actual source of the greenhouse gas emission - the ETS seeks to impose the compliance obligation as far up the supply chain as practical, with the aim of reducing overall compliance and enforcement costs. The expectation is that as price effects filter down the supply chain to direct emitters, this will provide an incentive to take steps to reduce emissions, resulting in an overall reduction of emissions. Compliance activities fall into six broad sector headings - forestry,

One of the last acts of the Government, prior to the election, was to enact an emissions trading scheme (ETS) for New Zealand. Amid widely expressed concerns that the scheme had been rushed through with inadequate consultation, more than 1,000 amendments recommended by the Select Committee, and further amendments introduced at the third reading stage, the incoming National-led Government has indicated a complete review of the ETS. We take a look at the proposed review process, the ETS as currently enacted, and some of the issues likely to be debated.

Proposed Review Process Emissions trading is a form of regulation aimed at reducing carbon-based emissions in the most economically efficient way, enabling an economic value to be put on both greenhouse gas emissions and reductions in emissions. The National Party went into the election earlier this month with a policy that broadly supported emissions trading as the best available tool to efficiently reduce green-house gas emissions across the economy. At the same time the National Party committed to introducing legislation amending the ETS in order to address the six major concerns it iden-tified in its minority select committee report. National has now committed to undertaking a complete review of the ETS as part of its support agreement with the ACT Party, which campaigned on a policy of abolishing the ETS. National has confirmed that it remains committed to retaining measures to address New Zealand's Kyoto obligations, by making amendments to the legislation that will balance environment responsibilities with economic needs. ACT has indicated it is not opposed to New Zealand adopting responsible climate change polices and would support legislation giving effect to such action if a rigorous select committee inquiry establishes a credible case. A ‘special select committee’ is to be set up to review the ETS and any proposed amendments or alternatives to it, including carbon taxes, ‘in light of the current economic circumstances’. Pending the outcome of the review, National has agreed to pass legislation delaying the implementation of the ETS as it currently stands, repealing the thermal generation ban and any other necessary interim measures. A draft terms of reference for the review, proposed by ACT but not at the time of publication yet agreed to by National, includes hearing ‘competing views on the scientific aspects of climate change’ and looking at the merits of a ‘mitigation or adaptation approach.’ It also

Emissions Trading - A Change In Political Climate

Climate Change

SIMPSON GRIERSON NOVEMBER 2008

"National has confirmed that it

remains committed to retaining

measures to address New Zealand’s

Kyoto obligations."

Monitoring and reporting emissions Participants must monitor and report annually on greenhouse gas emissions associated with compliance activities. An emissions return recording details of greenhouse gas emissions (measured in carbon dioxide equivalent emissions) for the previous calendar year is to be filed no later than 31 March. The number of tonnes of carbon dioxide equivalent emissions equates to the number of units that the participant must then surrender. Participants whose primary compliance obligations to surrender emission units start in or after 2011 must monitor and report on emissions for compliance activities in the preceding calendar year. Participants in some sectors can opt to voluntarily monitor and file an emissions return one year ahead of the compulsorily requirement to do so. These sectors are liquid fossil fuels, agriculture, waste and both industrial and removal activities relating to SF6 hydro fluorocarbons (HFCs) and per fluorocarbons (PFCs). An emissions return:

• records the participant’s activities; • calculates emissions/removals resulting from the participant’s activities; • assesses how many emission units are to be surrendered by the participant; and • must be signed by the participant. Additional information to be provided in an emissions return may be required by regulation. H o l d i n g A c c o u n t s a n d Surrendering Emission Units A participant is required to have a holding account in the New Zealand Emission Unit

Register (NZEUR) for surrendering, transferring and receiving emission units. The NZEUR can be found online at http://www.nzeur.govt.nz. The Crown has a large number of accounts in the NZEUR, including:

• a cancellation account (from which units cannot be further transferred);

• a retirement account (to which the Government transfers Kyoto units to offset its own obligations under the Kyoto Protocol. Kyoto units cannot be further transferred from this account);

• a surrender account; and • a conversion account (used to convert domestic emission units

(NZUs) into assigned amount units). To surrender an emission unit, a participant must apply to the Registrar to transfer emission units from its holding account into the Crown's surrender account. The Registrar must then seek a direction from the Minster of Finance as to whether or not the units can be transferred, and once directed by the Minister, the Registrar will then transfer the unit into the surrender account. Participants may also transfer emission units to overseas registries – for example, if a participant has sold units to an overseas purchaser so that an overseas purchaser can account for its own liability under a separate ETS. Again, the same process is followed, except that the unit is transferred to the Crown's conversion account so that the NZU becomes an ‘assigned amount unit’ before it is transferred.

Free allocation of emission units The ETS legislation, as currently framed, includes a free allocation framework aimed at ensuring the cost burden of the ETS is shared fairly across the economy. A number of general principles are identified in

liquid fossil fuels, stationary energy, industrial processes, agriculture and waste. Compliance obligations start at different times for different activities, generally by sector. The first sector to come within the ambit of the ETS was forestry with a start date of 1 January 2008. Other sectors progressively come into the ETS through to 2011. The table attached to this FYI identifies the specified compliance activities and the dates on which they come within the scope of the ETS. There is no doubt many submitters to the special select committee will be seeking a review of what compliance activities should be subject to direct compliance obligations, in particular activities related to agriculture, and when such obligations should apply as part of any new look ETS. The ETS also includes a number of optional activities within each sector. Anyone carrying out an optional activity can choose to become a participant and will be subject to the same compliance obligations as mandatory participants, for as long as they remain a participant. These voluntary participants can opt out, as well as opting in to the ETS, but may be subject to certain obligations when opting out. In many cases, optional activities enable participants to earn (rather than requiring surrender of) emissions units. Those optional participants who will have to surrender emission units will generally have chosen to participate in order to assume more direct control over the emissions costs imposed on their business, rather than simply be a price taker. A participant’s obligations Emission units are the ‘currency’ for the ETS. An emission unit may be an NZU, which is the domestic currency, or one of the approved international currencies. Approved international currencies are principally Kyoto currencies, such as certified emission reductions units (CERs) and emission reduction units (ERUs), but may also be any other currency recognised for the ETS from time-to-time. This would generally be a currency from another country's domestic emissions trading scheme. Emission units specifically excluded from the ETS are those deriving from projects involving nuclear energy. The primary compliance obligation under the ETS is a requirement to surrender or redeem one emission unit for each tonne of greenhouse gas (measured in carbon dioxide equivalent emissions) emitted. An emission unit does not exist as a tangible object but it can still be owned, surrendered, transferred or assigned. Other compliance obligations for ETS participants include:

• monitoring emissions by collecting data; calculating emissions (using set calculation methods); and keeping records of emissions. Verification of data collection and calculations may also be required by regulation;

• emissions reporting; and • maintaining a holding account with the New Zealand Emission

Unit Register (units can only be received and surrendered through a holding account).

Failure to comply with any of these obligations is an offence carrying a monetary penalty. Failure to surrender any or sufficient emission units also carries a make-good obligation. Offences committed with intent to deceive or evade obligations under the ETS also carry potential imprisonment consequences. Directors and managers of a company may have personal liability in certain circumstances.

"Compliance activities fall into six board sector

headings - forestry, liquid fossil fuels, stationary energy,

industrial processes, agriculture and waste."

This newsletter is produced by Simpson Grierson. It is intended to provide general information in summary form. The contents do not constitute legal advice and should not be relied on as such. Specialist legal advice should be sought in particular matters.

© Simpson Grierson 2008

Andrew Royle, Senior Associate DDI: 04 924 3504 Fax: 04 472 6986 Mobile: 021 687 974 [email protected]

Elisabeth Welson, Partner DDI: 04 924 3400 Fax: 04 472 6986 Mobile: 029 924 3400 [email protected]

Contact Information

Auckland Office 88 Shortland Street,

Private Bag 92518, Auckland, New Zealand

Tel +64 9 358 2222 Fax +64 9 307 0331

DX CX 10092.

Wellington Office HSBC Tower, 195 Lambton Quay,

PO Box 2402, Wellington, New Zealand

Tel +64 4 499 4599 Fax +64 4 472 6986

DX SX 11174.

E-mail: [email protected] Website: www.simpsongrierson.com

Christchurch Office PO Box 874, Christchurch 8140,

New Zealand

Tel +64-3-365 9914 Fax +64-3-379 5023

Office Locations

Michelle van Kampen, Senior Associate DDI: 09 977 5258 Fax: 09 977 5025 Mobile: 021 221 4206 [email protected]

Rob Fisher, Partner DDI: 09 977 5091 Fax: 09 977 5025 Mobile: 021 933 392 [email protected]

Nicolette Butler, Associate DDI: 09 977 5269 Fax: 09 977 5025 [email protected]

the legislation as the basis for determining free allocations. These include:

• avoiding outcomes which might lead to economic regrets, significant regionally-concentrated job losses and perverse behavioural incentives, including decisions relating to investment;

• new entrants to a sector or industry should be treated in a similar manner to those already operating in that sector or industry;

• certainty and consistency; and • minimising administrative and compliance costs.

The process for determining how the free units are allocated requires an allocation plan to be prepared by the Minister of Finance for each of the four groups identified for free allocation – pre-1990 forest owners, trade exposed industry, an Innovation Fund (to facilitate innovative technologies) and agriculture. There is no requirement for recipients of free allocations to be ETS participants. Allocation plans are to have regard to the enacted general principles, any other general principles the Minister considers appropriate and the specific principles for free allocation to the particular group also included in the ETS legislation. An allocation plan must explain who is eligible for the free allocation of emissions units and how many free emission units they will get. Draft allocation plans are to be made available for public consultation before being finalised. Free allocations are to be phased out from 2018. It is inevitable that free allocation and other mechanisms to assist trade exposed businesses as well as equitable cost sharing will receive a high degree of attention as part of the special select committee review.

Conclusion The change of government following the election has provided the immediate impetus for a wide-scale review of the ETS, encompassing a consideration of any viable alternatives. Similar reviews of climate change and emission reduction policy are, however, also being undertaken in a number of countries as a result of uncertainty caused by the global economic crisis. The business community in New Zealand will undoubtedly welcome the opportunity for further debate on the broader issues of an emissions trading scheme. Environmental groups, on the other hand, have branded National's suspension of the ETS as ‘a step backwards in environmental policy’. Notwithstanding that emissions trading is promoted as the lowest cost solution to compliance with Kyoto Protocol obligations, the current economic environment combined with associated uncertainties as to the price of carbon and the transitional costs and risks associated with the establishment of an ETS, are all serving to magnify the process concerns around the perceived haste with which the current legislation was pushed through. It is these concerns that underlie much of the scepticism and opposition to the operation of the New Zealand ETS. One thing that is certain, is that the outcome of the ‘special select committee’ review will be awaited with interest at a time when the exercise of balancing environmental obligations and economic considerations is perhaps more challenging than ever before.

Andrew Caddie, Senior Associate DDI: 09 977 5202 Fax: 09 977 5036 Mobile: 0274 929 967 [email protected]

The New Zealand Emissions Trading Scheme – Activity Compliance Dates

Compliance Activity Compliance Dates Forestry -

Deforesting pre-1990 forest land unless one of the exemptions applies

Voluntary Reporting: N/A Mandatory Reporting: N/A Obligations & Entitlements: 1 January 2008

Liquid Fossil Fuels - Owning more than 50,000 litres (in a year) of obligation fuel (as defined in the Climate Change (Liquid Fossil Fuels) Regulations 2008, generally motor spirit, diesel, avgas, jet fuel and fuel oil)- at the point where excise or excise equivalent duty is payable

Voluntary Reporting: 2009 Mandatory Reporting: 2010 Obligations & Entitlements: 1 January 2011

Industrial Processes - Producing: • iron or steel • aluminium, resulting in the consumption of anodes or

the production of anode effects • clinker or burnt lime, resulting in calcination of

limestone, or calcium carbonates • glass using soda ash • gold • cable using a nitrogen cure process


Stationary Energy - • Importing coal • Mining more than 2,000 tonnes (in a year) of coal • Importing more than 10 000 litres (in a year) of natural

gas • Mining natural gas, other than for export • Using geothermal fluid to generate electricity or

industrial heat • Combusting used oil, waste oil, used tyres, or waste to

generate electricity or industrial heat • Refining petroleum where the refining involves the use

of intermediate crude oil products (for example, refin-ery fuels and gases) for energy or feedstock purposes


Agriculture -

Fertiliser (processor): Importing or manufacturing synthetic fertilisers containing nitrogen OR Fertiliser (farmer): Purchasing, other than for on-selling, synthetic fertiliser containing nitrogen (if determined by Order in Council)

Voluntary Reporting: 2011 Mandatory Reporting: 2012 Obligations & Entitlements: 1 January 2013 (unless Fertiliser (farmer) brought into force)

Agriculture - Animals (processor): Slaughtering ruminant animals, pigs, horses, or poultry by a person who - (a) is the operator of a risk management programme registered under the Animal Products Act 1999; and (b) is not a retail butcher, as defined in section 4(1) of the Animal Products Act 1999 Dairy processing of milk or colostrums OR Animals (farmer): Farming, raising, growing, or keeping ruminant animals, pigs, horses, or poultry for: (a) reward; or (b) the purpose of trade in those animals, or in animal material or animal products taken or derived from those animals (if determined by Order in Council)

Voluntary Reporting: 2011 Mandatory Reporting: 2012 Obligations & Entitlements: 1 January 2013 (unless Animals (farmer) brought into force)

Industrial Processes -

Importing SF6, including in goods Importing HFCs or PFCs, including in goods, other than - (a) household goods, or other effects of a passenger of a ship or aircraft (accompanied or unaccompanied), that are not intended for gift, sale, or exchange; or (b) have medical uses necessary for human health, including metered dose inhalers Manufacturing SF6, HFCs or PFCs, other than through producing aluminium resulting in the consumption of anodes or the production of anode effects


Waste -

Operating a disposal facility (this definition is similar to the definition in the Waste Minimisation Act (which came into effect on 26 September 2008) except that it does not include a facility where waste is combusted for the purpose of generating electricity or industrial heat)


Offering Foreign Collective Investment Schemes In Singapore December 2008 | Corporate | Business Bulletin

Marian HO LI Shuhui

Collective investment schemes are commonly offered by foreign fund managers in Singapore as a means of tapping the local investor market.

There are two ways in which a foreign collective investment scheme constituted outside Singapore can be offered in Singapore: (1) as a retail scheme whereby the units may be offeredto any member of the public; and (2) as a restricted scheme which can only be offered to “sophisticated” investors.

Before a collective investment is offered as a retail or a restricted scheme to investors inSingapore, an application must be submitted to the Monetary Authority of Singapore (“MAS”) for registration.

Retail schemes

The following conditions should be satisfied in an application for recognition or authorisation as a retail scheme:

The laws and practices of the jurisdiction under which a collective investment scheme is constituted and regulated affords to investors in Singapore a level of protection at least equivalent to that provided to them under the Securities and Futures Act (“SFA”). There is a manager for the scheme which is licensed or regulated in the jurisdiction of its principal place of business and is a fit and proper person in the opinion of MAS. There is a representative to administer the scheme (“representative”) who is an individual resident in Singapore, or a company, or foreign company registered with the Accounting and Corporate Regulatory Authority of Singapore under the Companies Act. MAS has been furnished with information regarding the name and contact particulars of the representative and such other information as MAS may prescribe. A copy of the prospectus, prepared in accordance with the Third Schedule of the Securities and Futures (Offers of Investments)(Collective Investment Schemes) Regulations 2005 as required under section 296 of the SFA, is lodged and registered with MAS. The manager of the scheme is managing at least S$500 million of discretionary funds located in Singapore.

RESOURCES

It should however be noted that, notwithstanding compliance with the above, MAS may refuse to recognise the scheme where it determines that it is not in the public interest to do so.

Restricted schemes

Units in a restricted scheme may only be offered to relevant persons.

A “relevant person” includes (1) an accredited investor; (2) a corporation the sole business of which is to hold investments and the entire share capital of which is owned by one or moreindividuals, each of whom is an accredited investor; and (3) a trustee of a trust the sole purpose of which is to hold investments and each beneficiary of which is an individual who is an accreditedinvestor.

In the case of an individual, an “accredited investor” means a person whose net personal assets exceed in value S$2 million (or its equivalent in a foreign currency), or whose income in the preceding 12 months is not less than S$300,000 (or its equivalent in a foreign currency).

In the case of a corporation, an “accredited investor” means a corporation with net assets exceeding S$10 million (or its equivalent in a foreign currency), as determined by the mostrecent balance sheet of the corporation. An “accredited investor” may also mean a trustee of such trust as MAS may prescribe, when acting in that capacity, or such other person as MAS may prescribe.

A restricted scheme must comply with the following requirements:

The offer of units in the restricted scheme is not accompanied by an advertisement making the offer or calling attention to the offer or intended offer. No selling or promotional expenses are paid or incurred in connection with the offer other than those incurred for administrative or professional services, or by way of commission or fee for services rendered by a licensed or exempt securities dealer. The offer is made in or accompanied by an information memorandum which:

contains the statement that the offer or invitation is not allowed to be made to the retail public, and that the information memorandum is not a prospectus as defined in the SFA; and states the following particulars in respect of the scheme:

the investment objectives, focus and approach of and risks of subscribing for or purchasing the units in a restricted scheme; whether the offer of units in the restricted scheme is regulated by any financial supervisory authority and, if so, the title and jurisdiction of the legislation under which the restricted scheme is regulated and the name and contact details of the authority; in the case of a restricted scheme which is a corporation, its place of incorporation and business address; in the case of a restricted scheme which is not a corporation, the name and place of incorporation or registration of the manager for the restricted scheme and, where applicable, the trustee or custodian of the restricted scheme; and whether the manager for the restricted scheme and, where applicable, the trustee for the trust are regulated by any financial supervisory authority and, if so, the name and contact details of the authority.

Exemptions from registration with the Monetary Authority of Singapore

Apart from registration as a retail scheme or a restricted scheme under the SFA, offers of investment in a foreign fund may be exempted from registration in certain circumstances prescribed under the SFA. These include, among others:

offer and sale of units made on a private placement basis to no more than 50 persons within any period of 12 months; offer and sale of units in a scheme if little or no consideration is or will be given for the issue and the sale of the units; offer and sale of units in a scheme whereby the total amount raised by the scheme for any period of 12 months does not exceed S$5 million; or offer and sale of units in a scheme to an institutional investor.

© Rodyk & Davidson LLP 2008. Limited Liability Partnership Registration No. LL0700439L

CONDITIONS RELAXED FOR OVERSEAS ENTERPRISES' INVESTMENTS IN TAIWAN◎Lihuei Mao/Winnie Lin

Since early 2008 the Executive Yuan (EY) has announced a number of policy initiatives designed to make Taiwan's capital markets more international by encouraging overseas enterprises, including the overseas subsidiaries and holding companies of Taiwanese-invested businesses, to raise capital in Taiwan and to have their securities listed on the Taiwan Stock Exchange (TSE) or the GreTai Securities Market (GTSM, also called "OTC"). In March the EY approved the "1-2-3 Program" to promote the listing of foreign enterprises in Taiwan; in June it approved a plan to liberalize cross-strait securities investments; and in July it approved a plan for the relaxation of restrictions on the Taiwan listing of overseas enterprises and for moderate liberalization of Mainland Chinese investments in Taiwanese securities markets. The EY has also put forward a series of legislative amendments in support of these initiatives. In line with these legislative changes, the GTSM and the Taiwan Stock Exchange Corporation (TSEC) have amended their review criteria and related procedures for the OTC and TSE listing of foreign securities. The main content of the liberalization measures is as follows:

Relaxed conditions for overseas enterprises' primary listing in Taiwan Under the previous rules of the Financial Supervisory Commission (FSC) and the GTSM, only Taiwanese public-issuing companies could apply for registration on the GTSM's Emerging Stocks Market (ESM) and for subsequent listing on TSE or GTSM. Thus companies incorporated outside Taiwan could not apply for ESM registration or for primary listing in Taiwan. However, the FSC has amended the relevant provisions of the Criteria Governing the Offering and Issuance of Securities by Foreign Securities Issuers, and the GTSM has amended its Criteria Governing Review of Emerging Stocks Traded on the Over-the-Counter Market, to allow companies incorporated outside Taiwan that are not listed on other securities markets, and are in compliance with the relevant provisions of the Act Governing Relations between the Peoples of the Taiwan Area and the Mainland Area, to apply to the GTSM for their securities to be traded on the ESM in the same way as domestic enterprises, if they are recommended in writing by two or more qualified securities firms (of which one must be designated as the lead firm). After an overseas enterprise's securities have been traded on the ESM for six months, it can apply for listing on TSE or GTSM if it meets the relevant conditions. The EY is currently also preparing amendments to the Act Governing Relations between the Peoples of the Taiwan Area and the Mainland Area, with the intention that in principle any company incorporated outside mainland China will be able to apply for listing on TSE or GTSM in Taiwan. The EY does not plan to bar mainland-invested companies from such listing, or to place any restriction on the proportion of shares held by mainland investors. Secondary listing of HK-listed enterprises allowed In the past, the Hong Kong Stock Exchange (HKEx) was not among the foreign securities exchanges recognized by Taiwan's securities regulator, so that enterprises listed on the HKEx were not eligible for TSE or GTSM secondary listing in Taiwan. However, on 27 June 2008 the FSC, the TSEC and GTSM announced amendments to various laws, to include the HKEx as one of the foreign securities exchanges approved by the FSC. Accordingly, HKEx-listed enterprises are now able to apply for secondary TSE or OTC listing in Taiwan. Restrictions lifted on use of funds raised in Taiwan by overseas enterprises The previous legislation permitted overseas enterprises listed on FSC-approved foreign securities exchanges to

apply for secondary TSE listing in Taiwan. But in fact to date only five overseas enterprises have successfully achieved listing in Taiwan based on the issuance of TDRs. This is mainly because the following restrictions have dampened overseas enterprises' enthusiasm for seeking Taiwan listing: (1) an overseas enterprise was barred from listing in Taiwan if its investments in Mainland China exceeded a certain proportion of its net worth; and (2) funds raised on Taiwanese securities markets could not be used for direct or indirect investments in Mainland China. However, on 31 July 2008 the FSC amended Articles 7 and 9 of the Criteria Governing the Offering and Issuance of Securities by Foreign Securities Issuers, to abolish the above restrictions. Accordingly, the proceeds of an enterprise's capital-raising activities in Taiwan can henceforth be invested in Mainland China if so desired. This change should increase overseas enterprises' willingness to seek secondary listing in Taiwan. Reciprocal listing of Taiwan and HK ETFs to be allowed With regard to fund investments, the FSC intends to initially allow exchange-traded funds (a relatively sound and conservative investment product) offered by Taiwanese enterprises to be listed in Hong Kong, and on the basis of reciprocity, to allow Hong Kong ETFs to be listed and traded in Taiwan. This move is intended to enable Mainland Chinese investors to indirectly invest in Taiwanese securities via Hong Kong. The relevant legislative amendments have been approved by the FSC but pending promulgation. Fund-type FINIs need not declare non-mainland origin of funds In compliance with FSC directives, on 7 July 2008 the TSEC announced amendments to the forms appended to its Directions for Registration Processing for Offshore Overseas Chinese and Foreign Investors to Make Investments in ROC Securities or Engage in Domestic Futures Trading, so that when a foreign institutional investor (FINI) organized as a fund wishes to invest in Taiwanese securities and futures markets, it is no longer required to provide a declaration that its funds do not originate from Mainland China. However, a non-fund FINI investing in Taiwanese securities and futures markets is still required to declare at the time of registration that the funds it intends to remit into Taiwan for investment do not originate from Mainland China. Mainland Chinese QDIIs to be treated as foreign investors Mainland China currently allows only Qualified Domestic Institutional Investors (QDIIs) to invest in offshore securities, and limits a QDII's combined investments in the securities and assets of a single country or territory to a maximum of 10% of the QDII's net worth if the country or territory concerned has signed a memorandum of understanding (MOU) on regulatory cooperation with Mainland China, or 3% if the country or territory has not signed such an MOU. The Executive Yuan recently decided to allow Mainland Chinese QDIIs to invest in securities and futures in Taiwan. The relevant legislation is to be amended to provide a regulatory framework similar to the current rules for foreign investors.

Lee and Li Bulletin_September 2008 Issue

December 2008

PRIVACY UPDATE

Sony BMG Music Pays $1 Million Fine to Settle COPPA Charges

On December 11, 2008, the Federal Trade Commission (FTC) announced that Sony BMG Music

Entertainment (Sony Music) agreed to pay a $1 million penalty and comply with various conduct

requirements to settle the FTC’s charges that Sony Music’s music fan Web sites violated the

Children’s Online Privacy Protection Act (COPPA) by collecting, using, and disclosing the personal

information of more than 30,000 children under the age of 13. This settlement matches the FTC’s

Xanga consent order for the highest penalty for alleged COPPA violations.1 The magnitude of the

penalty appears to be related to the systemic nature of the violation coupled with the length of the

violation (alleged to be since 2004).

COPPA and its implementing regulation apply to operators of Web sites that collect personal

information from users when the Web site is targeted to children under 13 or the operator has actual

knowledge that users are under 13. If COPPA applies, the Web site must include a privacy policy

detailing what personal information it collects and how that information is used. To collect personal

information from children under 13, the operator must first notify the child’s parent, and to use or

disclose the child’s personal information, the operator must obtain verifiable parental consent. The

FTC uses a “sliding scale” approach to parental consent whereby the required method of consent

varies based on how the Web site operator uses or discloses the child’s personal information. A

COPPA violation may also constitute a violation of Section 5 of the FTC Act.

Sony Music operates more than 1,100 music-related Web sites that collect personal information

from users; these sites would almost exclusively be considered general audience sites under

COPPA. Some of the Web sites offer users the ability to enter sweepstakes or receive electronic

newsletters, others also allow users to participate on message boards, and many of the Web sites

offer more extensive networking capabilities enabling users to create user profiles, upload photos

and videos, post comments on message boards, and send messages to other users.

The registration process for the Sony Music Web sites requires users to enter personal information,

including their date of birth, or alternatively, to choose their age from a pull-down menu. The FTC’s

complaint charges that, based on the registration information, Sony Music had actual knowledge

that many users were under the age of 13. It appears that when Sony Music learned that a

registrant was under the age of 13, instead of blocking that user’s ability to register (usually via a

1 See also our September 2006 Privacy Update, “FTC Announces Imposition of $1 Million Civil Penalty Against Social Networking Site for Violations of Children's Online Privacy Protection Rule."

Hogan & Hartson LLP

http://www.ftc.gov/os/caselist/0623073/xangaconsentdecree.pdf

http://www.hhlaw.com/pressroom/newspubs/pubdetail.aspx?publication=2590

December 2008

notice denying registration and using a browser cookie that would not allow users to go back and

change their registration age), children under 13 were able to provide their personal information

and register with the site. Sony Music both used that personal information and permitted children to

participate in the public interactive portions of the Web sites without the parental notice and

consent required by COPPA.

The complaint further charges that Sony Music’s online privacy policy contains false and

misleading statements, in violation of Section 5 of the FTC Act. The privacy policy states that

children under 13 cannot participate without a parent’s permission and that users under 13 will be

prohibited from participating in Sony Music Web site activities through the use of persistent

cookies. However, the FTC alleges that despite Sony Music’s representations in its privacy policy,

Sony Music did not utilize such cookies and children who provided a date of birth indicating they

were under 13 were able to freely register.

In addition to the million dollar penalty, Sony Music has agreed to comply fully with COPPA, delete

all personal information obtained from children under 13 in violation of COPPA, provide links to

FTC consumer education Web sites for five years, and submit to monitoring by the FTC.

Companies that have general audience Web sites should confirm that their data collection practices

are consistent with COPPA and industry best practices. In particular, companies should confirm

that their Web sites are not collecting personal information from children under the age of 13

without obtaining verifiable parental consent.2 Furthermore, companies are encouraged to review

their privacy policies to confirm that they provide an accurate representation of data collection and

use practices.

The complaint and consent decree can be found here and more information on COPPA compliance

is available here.

***

About the Privacy Update Hogan & Hartson frequently publishes the Privacy Update to track privacy developments at the FTC, FCC, and U.S. Congress, as well as in the EU. If you have questions or would like more information about this development, please contact one of the lawyers listed below or any Hogan & Hartson attorney with whom you regularly work.

2 One popular practice to limit such collection is to “age gate” registrants’ in a neutral fashion (and without disclosing why the age information is being sought); if a potential registrant indicates an age under 13, the general audience Web site should stop registering the user, and then drop a cookie to prevent the user from utilizing the browser’s back button to return to the previous page and change his/her age.

http://ftc.gov/os/caselist/0823071/index.shtm

http://ftc.gov/bcp/edu/pubs/business/idtheft/bus45.shtm

December 2008

MARY ELLEN CALLAHAN [email protected] +1.202.637.6406 Washington, D.C.

KENDRA BERNER [email protected] +1.202.637.3251 Washington, D.C.

TULASI A. LEONARD [email protected] +1.202.637.3570 Washington, D.C.

This Update is for informational purposes only and is not intended as a basis for decisions in specific situations. This information is not intended to create, and receipt of it does not constitute, a lawyer-client relationship.

Copyright © 2008 Hogan & Hartson LLP. All rights reserved. Hogan & Hartson LLP is a District of Columbia limited liability partnership with offices across the United States and around the world. Some of the offices outside of the United States are operated through affiliated partnerships, all of which are referred to herein collectively as Hogan & Hartson or the firm.

www.hhlaw.com

Email Alerts MASSACHUSETTS RELEASES PROPOSED PHARMACEUTICAL AND MEDICAL DEVICE MANUFACTURER CODE OF CONDUCT December 11, 2008 By Karen F. Green, Scott M. Lassman, Michelle D. Miller, Felicia H. Ellsworth On December 10, 2008, the Massachusetts Public Health Council released proposed regulations to implement M.G.L. c. 111N, the recently-enacted state statute governing marketing activities by pharmaceutical and medical device manufacturers operating in Massachusetts.

The proposed regulations establish a Marketing Code of Conduct (Code) that will, when effective, prohibit certain payments to health care practitioners in the Commonwealth of Massachusetts, require disclosure of the nature, amount, and recipient of payments over $50 made to health care practitioners, and impose auditing and reporting requirements on pharmaceutical and medical device manufacturers to ensure compliance with the Code. The regulations apply to pharmaceutical and medical device manufacturers that employ a person to sell or market prescription drugs or medical devices in the Commonwealth. In a press release and presentation accompanying the release of the proposed regulations, Massachusetts described the proposed Code as the most "stringent" and "comprehensive" regulation of pharmaceutical and medical device manufacturer conduct to date. The proposed regulations are "intended to benefit patients, enhance the practice of medicine, and ensure that the relationship between pharmaceutical or medical device manufacturers and health care practitioners not interfere with the independent judgment of health care practitioners." 105 CMR 970.001.

Prohibited Activities

The proposed regulations would, among other things, prohibit a pharmaceutical or medical device manufacturer, or its agent, from providing to a health care practitioner in the Commonwealth:

grants, scholarships, subsidies, consulting contracts, or educational items in exchange for prescribing or disbursing prescription drugs or medical devices;

entertainment or recreational items of any value;

payments in cash or cash equivalents either directly or indirectly except as compensation for bona fide services;

complimentary items such as pens, coffee mugs, gift cards, or flowers;

meals that are part of an entertainment or recreational event, offered without an informational presentation, offered outside of a health care provider's office, or provided to a health care provider's spouse or other guest; and

financial support for the cost of travel, lodging, attendance, or other personal expenses of a non-faculty health care provider in connection with continuing medical education events, conferences, or meetings.

The proposed regulations do not prevent pharmaceutical and medical device manufacturers from providing modest and occasional meals in conjunction with informational sessions in specified clinical training settings, reasonable compensation for substantial professional and consulting services of health care practitioners for a genuine research project or clinical trial, the provision of prescription drug or medical device demonstration and evaluation units, and payments for bona

fide services, which are defined to include consulting services such as research and participation on advisory boards.

Disclosure Requirement

The proposed regulations require annual disclosure to the Department of Public Health (Department), by July 1 each year, of "the value, nature, purpose and particular recipient of any fee, payment, subsidy or other economic benefit with a value of at least $50" provided by a pharmaceutical or medical device manufacturer to any health care practitioner in connection with the company's sales and marketing activities. 105 CMR 970.009. The definition of sales and marketing activities included in the proposed regulations excludes payments made as reasonable compensation in connection with a genuine research project or clinical trial. 105 CMR 970.004. Each annual disclosure must be accompanied by a fee of $2,000 and a certification of accuracy by the disclosing company. The proposed regulations also prohibit a pharmaceutical or medical device manufacturer from knowingly structuring fees or payments to health care practitioners to circumvent the reporting requirements.

Compliance Requirement

The proposed regulations require pharmaceutical or medical device manufacturers to:

adopt and comply with the most recent Code as adopted by the Department;

adopt and submit to the Department a description of a training program to provide regular training to appropriate employees on the Code, which must ensure that all representatives who are employed by, or acting on behalf of, the company and who visit health care practitioners have sufficient knowledge of the Code, general science and product-specific information;

certify to the Department that it is in compliance with the Code;

adopt, and submit to the Department, policies and procedures for investigating and taking corrective action in response to instances of non-compliance with the Code; and

submit to the Department the name, title, address, telephone number, and electronic mail address of the compliance officer it has identified as responsible for operating, monitoring, and enforcing the Code.

105 CMR 970.005. Pharmaceutical and medical device manufacturers must certify to the Department that annual audits to ensure compliance with the Code have been conducted.

The proposed regulations suggest July 1, 2009, as the deadline for initial compliance with the Code, and July 1, 2010, as the date for submission of the first required disclosure report by pharmaceutical and medical device manufacturers.

Although certain consumer and industry groups submitted written and oral comments in advance of the issuance of the proposed regulations, the release of these proposed regulations begins the formal notice and comment period. The Department has set two public hearings on the proposed regulations. The hearings are scheduled to occur on January 9, 2009, at the Public Health Council Room, 250 Washington Street, Boston, MA, at 9 a.m., and on January 12, 2009, at UMASS Medical School, Amphitheater I, 2nd Floor, 55 Lake Avenue North, Worcester, MA, at 1 p.m.

The proposed Code would impose stringent and comprehensive restrictions on the marketing activities of pharmaceutical and medical device companies. Companies that will be affected by these restrictions should consider submitting comments to the Department or participating in the public hearings scheduled for January 2009.

Proposed Regulation 105 CMR 970.000

Department of Public Health Press Release

Department of Public Health Informational Briefing Memorandum

Department of Public Health Informational Presentation

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