The current legislation (the Renewable Energy Law) was enacted to support RES production in response to the European Union’s framework directive on renewable energy (Directive 2009/28/EC), which mandates that, by 2020, 24 per cent of Romania’s final consumption of electricity originate from RES. In addition, the Romanian Energy Strategy for 2007-2020 prescribes that the share of electricity generated from RES in the country’s aggregate final consumption should be at least 35 per cent by 2015 and 38 per cent by 2020.

The Renewable Energy Law was passed in 2008, but the incentive scheme for RES production has only been applicable since mid-2011. Under the scheme, producers of electricity from RES are allocated a set number of green certificates (“GC”) for each MWh of electricity generated and fed into the power grid/delivered to consumers, while energy suppliers are obliged to purchase a mandatory quota of GCs. The support period depends on the type of RES (wind, solar, hydro, biomass) and installation (new or refurbished. It can amount to up to 15 years for electricity generated in new installations.

ANRE’s proposal

To benefit from the GC support scheme, producers of electricity from RES must be accredited by the Romanian energy regulatory authority (“ANRE”). ANRE is tasked with monitoring their activities and preparing annual reports. If monitoring reveals overcompensation (i.e. significantly higher rates of return than the reference level), ANRE may propose a cut in the number of GCs for new beneficiaries/new entrants.

On 29 March 2013, ANRE published the 2012 Romanian GCs Market Monitoring Report, which concludes that overcompensation occurred in 2012 in respect of wind, solar and hydro energy. As a result, the authority has proposed to cut the number of GCs granted to new producers of wind, solar and hydro energy. ANRE’s proposals have yet to be approved by the Romanian government.

Changes to the Renewable Energy Law

In parallel to ANRE’s monitoring, the government has been working on a series of draft ordinances to amend the Renewable Energy Law, prompted by several factors. The number of GCs/MWh is viewed as excessive, especially with respect to solar energy, as real investment costs are significantly lower than the estimated costs on which the incentive scheme was conceived, leading to systematic overcompensation. The costs generated by the GC support scheme have increased significantly, generating an excessive burden on households and impacting negatively large industrial consumers. Finally, RES capacities largely exceed the current capacity of the national power transmission/distribution grid.

Changes under consideration include:

• Temporary and partial suspension of a number of GCs for wind, hydro and photovoltaic plants
• Corrections to the computation mechanism of the quarterly mandatory purchase quotas for GCs
• Amendment of the guarantee fund mechanism applicable to suppliers in breach of their quarterly mandatory quotas
• Repeal of the exemption case and reduction threshold provided in relation to the adjustment of the number of GCs in the event that the GC support scheme is applied cumulatively with other state aid
• Partial exemption of large consumers from the GC support scheme
• Maximum annual threshold and additional financial guarantees for RES capacities requesting access to the grid
• Change to ANRE’s monitoring calendar (i.e. monitoring reports should be performed twice a year instead of annually) and repeal of the suspensive clause, which ensures that any reduction of the number of GCs shall apply not earlier than 2015 (2014, in the case of solar projects)
• Possibility for RES producers to enter into bilateral agreements (only for producers of up to 5MW installed capacity) and regulated agreements for trading electricity generated from RES

In the current draft, the scope of a number of measures will have to be further specified by means of secondary legislation enacted by ANRE, such as the GCs’ postponement and the recovery mechanisms as well as the functioning of the GCs guarantee fund. It would be preferable to include these specifics in the text of the ordinance rather than leave them to ANRE, as it remains unclear when or how the authority would implement this secondary legislation.

In addition, the limitation on the maximum annual thresholds for allowed new RES capacities introduces serious uncertainty as to the possibility to benefit from the GC support scheme, despite the investment made up to the accreditation phase of a RES project. This could possibly be construed as an anticompetitive and discriminatory measure, and a violation of the fair and equitable standard of protection of an investment.

The 30-day public debate period ended this month. There may be further changes before the final text is submitted to the European Commission for approval. But there is no doubt that when adopted, these measures will have a negative impact on the renewable energy sector. The days of Romania’s favourable investment climate in RES may be counted.

For more information please contact Ştefan Botezatu, partner and head of the energy practice in our Bucharest office: stefan.botezatu@kinstellar.com

Kristóf Ferenczi, partner and head of Kinstellar’s firm-wide energy practice, opened the seminar and summarised in his keynote address the main regulatory changes which were introduced by the third trading period of the EU ETS and also highlighted some of the challenges the EU ETS regime is currently facing. Zsolt Csanádi, managing associate at Kinstellar’s Budapest office, spoke about the new auctioning mechanism, which constitutes one of the main novelties in the revised EU ETS and has particular relevance for clients active in the power sector. Balázs Sepsey, associate at Kinstellar’s Budapest office, presented the revised rules of free allocation of emission allowances, focusing on the relevant practical implications on the industries which are facing the risk of carbon leakage.

Presenters from Deloitte Hungary included Róbert Reiniger, senior advisor at Environmental Services, who spoke about the expected regulatory changes in the CO₂ emission monitoring and verification system, and Áron Kovalóczy, deputy-director of Financial Services, who talked about the potential financial risks associated with CO₂ market price fluctuation.

Over 60 senior representatives from major Hungarian energy companies, industrial manufacturers and financial institutions attended the event.

The BCA gives existing companies the choice of remaining governed by the current legislation (the Commercial Code) or to opt into the BCA. The switch to the BCA regime must be made by 1 January 2016.

Although the BCA introduces a new and untested legal regime, there are good arguments for existing companies to opt in.

Even if an existing company chooses to remain governed by the Commercial Code, provisions of its founding documents that do not conform to the mandatory provisions of the BCA will become void on 1 January 2014. Any such company is therefore obliged to modify its founding documents to bring them in line with the new law and file them with the Czech Commercial Register within six months of the BCA entering into effect. Unless a company formally opts for the BCA regime, it may find it harder to determine which provisions of its founding documents are valid and which rules it must follow.

What’s more, there is no indication in the BCA as to which of its provisions are mandatory. In many cases, it is unclear whether a particular provision of the BCA is compulsory, or whether companies will be able to regulate a specific issue differently. Misjudging whether a BCA provision is mandatory or not may expose a company to unpredictable legal consequences. The difficulty of determining the extent of these consequences is compounded by the fact that it may take years before a body of court decisions shed some clarity on the interpretation of the scope of key provisions.

Companies that choose to opt into the BCA can eliminate the aforementioned risk by adopting new founding documents. These documents can be structured so that they deviate from statutory provisions only to the extent explicitly permitted by the BCA.

Further, for companies that remain subject to the old regime of the Commercial Code, it is not yet clear whether certain limitations –  such as restrictions on transactions between related parties (section 196a), the need to obtain the consent of the supervisory board to enter into a contract the size of which exceeds the statutory threshold (section 193 subsection 2), or the prohibition on dividend payments after the lapse of six months from the end of a financial year (established by the case law of the Supreme Court on the basis of section 178) – will remain applicable after the BCA comes into effect.

The decision to remain subject to the provisions of the Commercial Code may also affect the attractiveness of a company as a target, especially for a buyer already operating under the full BCA regime. Reasons for this include added legal work, increased complexity of the transaction, potential non-conformity of the target’s founding documents to the BCA and related legal risks, impossibility of opting into the BCA regime after the two-year transition period, and impossibility of unifying the legal regime of companies within a group after the target is acquired.

While the decision to be governed by the provisions of the BCA must be made based on an assessment of each company or group of companies’ particular situation, there are already many compelling reasons to consider opting into the new regime.

For more information please contact Lukáš Ševčík at Lukas.Sevcik@kinstellar.com

April 2013 - Kinstellar is pleased to announce that its practice in Hungary, Andrékó Kinstellar, was again named the "Law Firm of the Year" in Hungary at the IFLR European Awards ceremony in London on 10 April 2013. Kinstellar is the first practice in Hungary during the 14-year history of the award to pick up this accolade for the second time in a row.

The award recognises that Kinstellar has acted on the largest and most innovative transactions in Hungary over the past year, including several of the largest and most complex M&A transactions completed in 2012, the largest insolvency proceedings in Hungarian corporate history, the largest corporate debt offering by a Hungarian issuer in 2012 and several other leading transactions.  

Csilla Andrékó, Managing Partner of Kinstellar’s practice in Hungary, comments: “This is already the fourth time that our team in Hungary receives this country award from IFLR during its 14-year history.  We are pleased to see this repeated validation and recognition of the success of Kinstellar’s regional, independent business model. This signals an exceptional momentum for our practice acknowledging the strengths of our high-quality team clearly demonstrating that even in a very difficult environment, quality, commitment and hard work are recognised and appreciated by clients. As always, we remain committed to excellence and teamwork by way of developing and fielding the most talented lawyers to accommodate client need.”

Jason Mogg, Kinstellar’s firm-wide Managing Partner, comments: “We are proud of our ability, across the whole Emerging Europe region, to operate at a global standard when serving our clients. This accolade underlines that our commitment to our core values and business model is highly popular among clients and peers.” 

The number of exemptions has been reduced in the new legislation. Public procurement funded from foreign credits granted by international organizations and international financial institutions is still excluded from its scope. In addition, special provisions apply to public procurement in the areas of water management, energy, transport and postal services.

Part of the new law is dedicated to prevention of corruption. It explicitly requires the Public Procurement Office to draft a plan for combating corruption in public procurement procedures, and contracting authorities with an estimated annual value of public procurement in excess of one billion dinars (ca. 8,950,000 Euro) to adopt an internal plan for preventing corruption. In addition to stringent record-keeping requirements, contracting authorities must also devise clear rules governing the planning, execution, control and monitoring of public procurement procedures. The new legislation includes specific provisions on conflicts of interest and a duty to report corruption. Whistleblower protection is introduced in the form of a right to indemnification for individuals who are sanctioned (e.g. dismissed) as a result of reporting a violation.

The law introduces some new measures, such as the monitoring of public procurement over RSD 1 billion dinars (ca. 8,950,000 Euro) by “civil supervisors”, who are either experts in the domain of public procurement or associations dealing with the  prevention of corruption or conflicts of interests. The law also sets out in detail the rules for public procurement of standardized goods and services (done solely by electronic means using the open procedure), as well as for electronic auctions. It also introduces a “competitive dialogue” procedure, applicable in cases where the subject matter of the procurement is of such complexity (e.g. in light of its technical specifications or legal or economic structure) that the contract cannot be awarded through regular procedures.

The new legislation includes refinements of the many requirements applying at various stages of the public procurement procedure: notice, invitation and publication, tender documents, public procurement value, technical specifications, eligibility criteria, bidding process and awarding of contracts. Domestic bidders are still advantaged over foreign bidders, as are goods of domestic origin, subject however to the provisions of the Central Europe Free Trade Agreement and the Stabilization and Association Agreement (for EU bidders).

In terms of sanctions, non-compliance may lead to the imposition of fines, though it remains to be determined whether they are high enough to constitute a real deterrent. Contracting authorities may be fined up to RSD1,000,000 (ca. 8,950 Euro) for breaching procedural or technical obligations (e.g. record-keeping, publication). For more serious violations, such as failure to follow public procurement procedures when no exemption exists or accepting bids of interested persons, fines may go up to RSD 1,500,000 (ca. 13,400 Euro). Bidders who provide inaccurate or false information, hire undisclosed sub-contractors or act as an interested person, for example, can be fined up to RSD1,000,000 (ca. 8,950 Euro). Individuals (physical persons) acting for a contracting authority or bidder may also be fined a more modest sum.

Strengthening institutional capacity with adequate resources (financial/human) and technical capabilities will be critical to the successful implementation of the law, especially considering the broad mandate given to some bodies. The Public Procurement Office is tasked with monitoring the application of the law and the conduct of public procurement, providing assistance to contracting authorities and bidders, running the Public Procurement Portal and proposing measures to improve the public procurement system. The Republic Commission for the Protection of Rights in Public Procurement Procedures is responsible for ensuring the protection of rights in public procurement procedures and conducting minor offence proceedings. Harmonization of work between these institutions and others who have an implementing role will be important.

The new law on public procurement is one of the government’s important achievements in setting up a framework to prevent and fight corruption. In Transparency International’s latest Corruption Perception Index (CPI 2012), Serbia had marginally improved its standing, and stood at 80th overall, a score still denoting pervasive corruption problems. The hopes are high that the resources invested in the implementation of the new law to support its objectives will improve the situation.

For more information contact:

Branislav Maric, Partner
Zajednička advokatska kancelarija Marić & Mujezinović, in cooperation with Kinstellar
+381 11 3210 201, branislav.maric@kinstellar.com

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Kinstellar is the only independent law firm in Emerging Europe with a dedicated regional Compliance, Risk and Sensitive Investigations practice. Our strengths include a multi-jurisdictional approach, cross-disciplinary capabilities to handle complex matters, deep knowledge of the region’s anti-corruption laws and culture, familiarity with regional enforcement trends and proficiency in dealing with local authorities.

For more information about Kinstellar’s Compliance, Risk and Sensitive Investigations practice, contact:

Jitka Logesová, Partner
Head of Compliance, Risk and Sensitive Investigations
+420 221 622 111, jitka.logesova@kinstellar.com

Topics at the conference included anti-corruption compliance in CEE and SEE, compliance programs and best practices, compliance monitoring and third party due diligence, internal investigations, and FCPA and Bribery Act enforcement trends.

Jitka Logesová, Partner and head of Kinstellar’s firm-wide Compliance, Risk and Sensitive Investigations practice, and Bogdan Bibicu, Partner and head of the Banking, Finance & Capital Markets and Compliance, Risk and Sensitive Investigations practices in Kinstellar’s Bucharest office, shared their expertise and regional perspective on best practices in internal investigations, anti-bribery due diligence, and whistleblower protection.

Other participants included senior executives and compliance officers from leading multinationals such as Siemens, Whirlpool, Dow Corning and Halliburton.

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Kinstellar is the only independent law firm in Emerging Europe with a dedicated regional Compliance, Risk and Sensitive Investigations practice. Our strengths include a multi-jurisdictional approach, cross-disciplinary capabilities to handle complex matters, deep knowledge of the region’s anti-corruption laws and culture, familiarity with regional enforcement trends and proficiency in dealing with local authorities.

For more information about Kinstellar’s Compliance, Risk and Sensitive Investigations practice, contact:

Jitka Logesová, Partner
Head of Compliance, Risk and Sensitive Investigations
+420 221 622 111, jitka.logesova@kinstellar.com

Hana Gawlasova, Partner and head of the Telecoms, Media and Technology practice at Kinstellar, also shared her insights on overcoming data protection and privacy law pitfalls when conducting internal investigations.

During the panel discussion, Miroslav Uřičař, general counsel of T-Mobile Czech Republic a.s., shared his practical experience with implementing anti-corruption measures.

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Kinstellar is the only independent law firm in Emerging Europe with a dedicated regional Compliance, Risk and Sensitive Investigations practice. Our strengths include a multi-jurisdictional approach, cross-disciplinary capabilities to handle complex matters, deep knowledge of the region’s anti-corruption laws and culture, familiarity with regional enforcement trends and proficiency in dealing with local authorities.

For more information about Kinstellar’s Compliance, Risk and Sensitive Investigations practice, contact:

Jitka Logesová, Partner
Head of Compliance, Risk and Sensitive Investigations
+420 221 622 111, jitka.logesova@kinstellar.com

In their presentation, Messrs Ferenczi and Botezatu highlighted the significant changes currently underway in the Emerging Europe power sector. These include the further implementation of the EU’s Third Energy Package, which is designed to further liberalise the gas and electricity markets in EU member states; the on-going reform of the EU’s Emissions Trading Scheme; the extension of power market coupling across Emerging Europe; the further development of nuclear power across the region; and the increasingly active role of the state in both regulation and investment in the Emerging Europe power sector.

One new trend on the rise in some Emerging Europe markets is that some of the long-term foreign investors in utilities sector are exiting or seeking to exit the region. This is due to a variety of reasons, including the increased regulatory framework, and it is opening the space to new investors, often local or regional power companies, but also those from Russia, Asia and elsewhere. These new investors are increasingly focusing on regulatory compliance and financing issues from the outset and are seeking increased local expertise to implement new projects.

The presentation concluded with a series of recommendations for energy investors in the region. These include strengthening due diligence before any acquisition, closer communication with regulatory bodies, and ensuring that investors have a clear understanding of the long-term implications of energy assets.

Kinstellar’s Energy practice is expert at handling energy sector issues in multiple jurisdictions in Emerging Europe and beyond. The firm’s clients include major multinational, regional and domestic energy companies, governments, energy traders, project sponsors/financiers, as well as contractors and suppliers.

For more information, contact Henrieta Hochmanova at Henrieta.Hochmanova@kinstellar.com.

This is an outstanding result, made even more remarkable considering that Kinstellar’s operations in only five of the 21 jurisdictions defined by DealWatch in its Emerging Europe category were included in the calculation.

Kinstellar’s strong M&A results in Turkey in 2012 are excluded from the DealWatch Emerging Europe league table.

In Turkey, Kinstellar is ranked #2 in the “MergerMarket M&A Roundup for 2012” by deal value among all law firms in Turkey. This, too, is an outstanding achievement, particularly as Kinstellar has been active in Turkey for a relatively short period of time.

Jason Mogg, Kinstellar’s Firm-wide Managing Partner, comments: “Kinstellar’s league table results for 2012 are fantastic and underscore our commitment to excellence and our continued success handling some of the largest and most important transactions in our region. These results demonstrate that, by the measure of M&A deal value, Kinstellar is in fact the number-one independent law firm in both CEE and Turkey.”

2012 M&A league table results:

Emerging Europe geographic area, understood as the dominant country of operations of the deal target, covers: Albania, Belarus, Bosnia and Herzegovina, Bulgaria, Croatia, Czech Republic, Estonia, Hungary, Kosovo, Latvia, Lithuania, Macedonia, Moldova, Montenegro, Poland, Romania, Russia, Serbia, Slovakia, Slovenia and Ukraine. 

For more information, contact Adela Ene at adela.ene@kinstellar.com.

Gábor Antal, Managing Associate, and Dávid Klacsmann, Associate, opened their presentation with a review of general counsel trends and new developments and how the role of general counsel is evolving in Hungary. They then spoke about current topics of interest, in particular the US Foreign Corrupt Practices Act and the UK Bribery Act and the direct and indirect ramifications that these and other cross-border anti-corruption laws have in Hungary. Their presentation included a discussion on Kinstellar’s practical experience to date with new legislation in Hungary, including the new Data Protection Act and the new Labour Code.

Presenters from KPMG were Csaba László, Senior Partner and Head of Advisory Services and György Antalóczy, Manager, Head of Forensic Services, who spoke on the results of KPMG’s Global General Counsel Survey and provided an analysis of the challenges facing general counsel in today’s corporations.

Attendees at the event included senior representatives from several leading corporates in Hungary, including MVM (Hungarian Electricity Works), MOL Hungarian Oil & Gas Company, OTP (the largest commercial bank in Hungary), GE, Nissan, Mercedes/Daimler, Allianz, CIG Pannónia, Telenor and several others. The presentations were followed by a thoughtful Q&A session.

For more information, contact:

Adela Ene
Tel: +40 21 307 1639
adela.ene@kinstellar.com

The results may seem at first glance encouraging for several emerging European countries, but, on closer examination, they are not particularly impressive. TI has changed its scaling system (the scale now ranges from 0 to 100, from most to least corrupt) as well as its methodology: it now uses raw scores from its data sources rather than a country’s relative position. Though this will improve the accuracy of rankings and comparisons over time, this year’s scores cannot be directly compared with last year’s.

As its name suggests, the CPI only measures perceptions of corruption, not corruption itself. The scoring of countries may have been affected by the changes in methodology, and the ranking position of one country may have changed even when the local situation has not evolved, due to changes in other countries’ scores. The index has its limits and cannot be viewed as a scientific measure of corruption. Nonetheless, it is widely seen as the best available reference benchmark of corruption.

We have reviewed the results for the countries in which Kinstellar has offices, namely the Czech Republic, Hungary, Romania, Serbia, Slovakia and Turkey. None of them has shown significant improvement on last year, though some seem to be faring better than others. Romania, Hungary, Turkey and Serbia have marginally progressed in their standing, while the Czech Republic and Slovakia’s perceived levels of corruption have not.

Romania. The country is ranked 66^th overall, up from 75^th in 2011. This advancement was perhaps a response to positive initiatives, such as the unbundling of the state-owned power monopoly and the revaluation of investment contracts, which have boosted investors’ confidence. And in 2012, a number of cases finally came to a close and some high-ranking officials were handed jail sentences for graft. Despite recent progress, more remains to be done to consolidate Romania’s fight against corruption, and the EU has maintained its monitoring process there.

Hungary. Despite criticisms for stifling democratic principles, Hungary moved up to 46^th place overall. Though corruption remains a challenge, this modest ascent may have something to do with the launch earlier this year of the country’s anti-corruption programme – including the introduction of measures to regulate lobbying and protect whistle-blowers, the reinforcement of public prosecutors’ capacities, and the State Audit Office making the fight against corruption in the public sector its priority.

Turkey. The country improved its standing slightly in 2012 and now occupies the 54^th place, which it shares with the Czech Republic. Earlier this year, Turkey was awarded a Public Service Award by the UN for preventing and combating corruption in the public service. However, corruption is still considered widespread in the country.

Serbia. The new government’s recent anti-corruption measures seem to be paying off, the country having moved up slightly to 80^th place. Fuelled by its aspirations to EU membership (the European Council confirmed Serbia as a candidate country in March), the country has intensified both its review of privatisations and its crackdown on certain businessman, including ex-ministers. Whether this development constitutes genuine anti-corruption action or simply reflects political rivalry and attempts at point scoring remains a question. Despite this, Serbia is still perceived as one of the most corrupt countries in Europe. Organised crime, the excessive involvement of political parties in the public sector, opacity in public spending decisions and weak enforcement are some of the factors contributing to the poor score.

Slovakia. Despite the high profile Gorila scandal, which brought to light alleged secret deals between government officials and private investors in 2006 and ushered in a new government on an anti-corruption platform in the March 2012 election, Slovakia has made little progress in its fight against corruption. It is the 5^th worst ranked country in the EU and the lowest ranked of the Central European countries, which reflects a lack of genuine interest in tackling big corruption cases.

Czech Republic. The Czech Republic has seen some high-profile cases in recent months, with prosecutors and police intensifying their clampdown on corruption, including the arrest in June of David Rath, the former governor of the Central Bohemian region. In August, the EU released funding that had been blocked due to corruption scandals. But the country’s 54^th place in this year’s index testifies to stagnation rather than progress. It is unclear whether the enforcement actions and high profile cases amount to political score settling or actually reflect a genuine anti-corruption drive.

Emerging Europe’s marginal improvements in 2012 probably have as much to do with other countries worsening their own positions by comparison as they do with positive developments inside Emerging Europe. Greece and Italy, two of the EU countries most affected by the financial crisis, have dropped in the rankings, a reflection of their inability to tackle corruption in difficult economic times.

More significantly, all countries reviewed here, with the notable exception of Hungary, scored below 50, which denotes serious corruption problems. Most countries in Emerging Europe are still plagued by a rather weak culture vis-à-vis corruption, a judiciary sometimes prone to political interference, a lack of transparency and accountability in the financing of political parties, strong political ties in public companies’ management, public tender rigging, red tape and opacity in the business sector, vulnerability of prosecuting bodies to political influence and misuse of EU funds. And though most countries in the region have adopted sweeping anti-corruption programmes, few have backed them up with adequate human and financial resources to administer and prosecute the laws on their statute books.

But change is happening. Its main driving force is the increased prosecution of corporate corruption abroad – with an impact on business in these jurisdictions. The public is less blasé about the issue and many, especially among the younger generations, are steaming mad about it. This is sure to give rise to more and more whistle blowing and media attention. Companies caught on the wrong side of this anger can expect ‘blowback’. As corruption is less and less tolerated in the region, ensuring compliance in all business ventures is bound to become a priority.

For further information, please contact Jitka Logesová, head of Kinstellar’s Compliance, Risk and Sensitive Investigations practice: jitka.logesova@kinstellar.com, +420 221 622 111.

The seminar addressed topical issues relating to risks, compliance and sensitive investigations. As international legislation and enforcement proceedings begin to clamp down on corruption, compliance is becoming increasingly important to corporate agendas across Europe. This is also true in the emerging markets of Central and Eastern Europe and Turkey. Though corruption is still prevalent, there are clear trends towards greater scrutiny on the part of local authorities, and the incidence of investigations and enforcement proceedings is on the rise. Increasingly, companies are taking a pro-active approach to detecting and preventing violations. In some jurisdictions, internal investigations can prompt voluntary disclosure and mitigation (or even avoidance) of penalties. Many global organisations may face similar issues in several jurisdictions in this region, or encounter issues that are part of a wider problem. It is often difficult to navigate through the region’s web of anti-corruption regimes. Companies with operations in the region (often spanning multiple jurisdictions) and their international counsel need a coordinated approach to compliance and enforcement matters.

Three Kinstellar partners made presentations at the event: Daniel Torsher gave an overview of anti-corruption regimes and enforcement trends in the region. Jitka Logesová addressed key issues to consider when appointing legal counsel and Bogdan Bibicu shared some practice notes in the conduct of cross-border investigations.

Andrey Novikov, Ferenc Biro and Mariusz Witalis of Ernst & Young also presented case studies in recent corruption cases and enforcement trends.

The seminar was followed by a lively panel discussion, which included Dominik Adamski, a senior forensic officer with the European Investment Bank, Elena Chernyshevich, compliance officer for Janssen, Tom Nicholson, forensic researcher in Slovakia, John Smart, head of Ernst & Young’s Fraud Investigation & Dispute Services and Radosław Wywiał, compliance manager at MAN Truck & Bus. The discussion was moderated by Jason Mogg, Kinstellar’s Managing Partner.

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Kinstellar is the only independent law firm in Emerging Europe with a dedicated regional Compliance, Risk & Sensitive Investigations (CRSI) practice. We have multi-jurisdictional and cross-disciplinary capabilities to handle complex internal investigations and sensitive white-collar crime cases.

http://www.kinstellar.com/practices/compliance-risk-sensitiveinvestigations/

For more information about Kinstellar’s CRSI practice, contact:

Jitka Logesová, Partner
Head of Compliance, Risk & Sensitive Investigations
+420 221 622 111, jitka.logesova@kinstellar.com

The special report highlights, country by country, the current situation of Chinese-CEE business relations and trends for the future.

In Hungary, in an effort to boost Chinese-Hungarian investments, the government in May signed a broad-based cooperation agreement with several Chinese entities. While some deals have materialised, some observers note that the pace of investment has been slower than initial expectations.

Csilla Andrékó cautions that the speed of regulatory reform in Hungary “may come as a surprise” to some Chinese investors, who may be unfamiliar with the country. Despite this, one trend that is emerging is that Chinese equipment makers are looking to invest in Hungary in order to move up the value chain.

A case in point is the acquisition by Well-Tech, a Chinese sheet metal processing company, which acquired Hundec, a Hungarian sheet metal processor, in February this year. Kinstellar advised Well-Tech on the €25 million transaction.

Ádám Máttyus explains that this was a distressed sale, as Well-Tech was able to complete the transaction following bankruptcy proceedings in France against the former shareholder in Hundec. The deal also involved complex legal advice.

“The formation of a joint venture enabling certain top managers to complete a partial management buy-out added an extra layer of complexity to the structure.” The management buy-out “was used to retain and incentivise well-performing management at the company,” Mattyus explains.

Well-Tech’s acquisition of Hundec is one of the top six Chinese transactions in CEE in the past two years.

For more information, contact Gabor Antal on gabor.antal@kinstellar.com.

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Kinstellar is Emerging Europe's leading independent law firm, with offices in Belgrade, Bratislava, Bucharest, Budapest, Istanbul and Prague.

www.kinstellar.com

The aim of the conference was to bring together the main participants in Hungary’s green energy sector and to provide a forum to discuss the challenges and opportunities within the sector. Participants included senior representatives from leading energy companies, banks, energy consultants, environmental experts, large energy consumers and government.

Topics of discussion included: global trends on the green energy market; renewable energy investments in CEE; project financing; and innovation & technology. There was also discussion on the challenges facing the further development of the renewables energy sector in Hungary.

In addition to the economic downturn, the lack of comprehensive regulatory framework was cited as one of the main challenges. In his presentation, Kristóf Ferenczi discussed regulatory risks relating to investments in green energy projects in Hungary. He explained how risks of governmental intervention in the sector are not unique to Hungary but can be found across the region, and he stressed the importance of legal guarantees to facilitate investment.

Kinstellar has handled some of Emerging Europe’s most significant renewable energy deals, including the development and financing of wind farms, small-scale hydropower plants and bio-fuel refineries. Kinstellar’s experts have a thorough understanding of the needs of renewable energy investors, including technical and regulatory issues, commercial agreements and incentive programmes.

http://www.kinstellar.com/practices/energy/

For more information about Kinstellar’s Energy Practice, contact:

Kristóf Ferenczi
Partner
+36 1 428 4400
kristof.ferenczi@kinstellar.com

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Kinstellar is Emerging Europe's leading independent law firm, with offices in Belgrade, Bratislava, Bucharest, Budapest, Istanbul and Prague.

www.kinstellar.com

Attendees included senior in-house counsel from several leading financial institutions and companies in the Czech Republic, including Citibank, Global Payments Europe, Home Credit, Pražská energetika, Raiffeisenbank, Sazka, Royal Bank of Scotland, J&T Finance Group and Tesco.

Presenters from Kinstellar’s Prague office included Jitka Logesová (Partner), Marcela Vytlačilová (Regional Information Officer) and Petr Měšťánek (lawyer, Head of Know-how).

Kinstellar has a unique collection of know-how material, including a library with over 15,000 legal articles, over 9,000 court cases and over 4,500 scholarly books. The know-how collection has been built systematically since 1993, and the individuals currently responsible for knowledge management services have been with the firm since 1997.

This new product provides in-house counsel with access to Kinstellar’s expertise in legal know-how and its breadth of resources. In addition to access to Kinstellar’s know-how library, the product also includes periodic updates regarding new laws, case law, interesting articles from the legal profession and a platform for sharing know-how resources.

The participants at the seminar were offered a free, two-month trial period during which they can test the offered services.

A second, introductory seminar is being planned for the coming weeks, as several companies unable to attend the first seminar have already expressed interest.

For more information about Know-how Support for In-house Lawyers, or to reserve a space at the next introductory seminar, please contact:

Petr Měšťánek on +420 221 622 268 or at petr.mestanek@kinstellar.com

Marcela Vytlačilová on +420 221 622 145 or at marcela.vytlacilova@kinstellar.com

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Kinstellar is Emerging Europe's leading independent law firm, with offices in Belgrade, Bratislava, Bucharest, Budapest, Istanbul and Prague.

www.kinstellar.com