For the benefit of our clients and friends investing in European distressed opportunities, our European Network is sharing some current developments.

Recent Developments

France—"Labor" Law No. 2016-1088, which was enacted as a French Act of Parliament on 8 August 2016, became effective on 10 August 2016. Widely covered by the French media since the first version of the legislation was adopted on 24 March 2016, the newly enacted labor law implements numerous changes to the French Labor Code, principally by significantly enhancing the collective bargaining rights of employees. Notably, company-wide collective bargaining agreements now take precedence over sector-wide bargaining agreements with respect to hours of employment, including overtime, overnight work and daily break time. To avoid any impairment of collective guarantees negotiated at the company/establishment level, the new law provides a "right of review" to the affected branch/industry in the form of annual appraisals by a committee of the work time provisions in company-wide collective bargaining agreements. With a view toward increasing the flexibility of France's Labor Law, the new legislation contains various changes to provisions governing employee representatives, termination of employment for economic reasons, professional training and health care.

Italy—The laws and regulations governing real estate investments in Italy, the different types of investment vehicles available for such transactions and the tax implications for resident and non-resident investors can sometimes be confusing. A white paper providing an overview of Italian real estate investments, including a discussion of various investment vehicles (i.e. real estate companies, real estate investment funds, limited real estate investment trusts and real estate SICAFs), deal structures, commercial leases and tax considerations for resident and non-resident investors, is available here.

The European Union and the UK—The short- and long-term ramifications of the 23 June 2016 referendum in which UK voters elected by a 52 percent to 48 percent margin to leave the European Union are still a matter of frenzied speculation. Jones Day's European Labor & Employment Practice recently launched a newsletter to inform readers of interesting developments in labour and employment law around Europe. The focus of the August 2016 edition is the anticipated impact on such laws of a possible Brexit.

The European Union—Measures defined by the European Parliament in its recently approved Directive on Security of Network and Information Systems provide procedures for improving the level of cybersecurity in the European Union by imposing minimum harmonisation rules for Member States. A more detailed examination of the guidelines for "digital service providers"—one of two types of entities covered by the Directive—including online marketplaces, online search engines and cloud computing services, is available here. Member States have approximately 21 months to implement the Directive into their respective laws.

The European Union and Ireland—On 30 August 2016, the European Commission announced its finding that tax rulings obtained by two Irish subsidiaries of Apple constitute illegal State aid. The Commission concluded that Apple must pay Ireland an amount equal to the alleged tax benefits, plus interest, amounting to some €13 billion (US$14.6 billion). Both the government of Ireland and Apple have vowed to appeal the ruling. This is the fourth Commission case concerning a tax ruling in less than one year. Two other ongoing cases involve tax rulings in Luxembourg, and the Commission has announced plans to open further investigations. The Commission's initiatives may cast doubt on the validity of a host of past tax rulings obtained by multinational companies from EU Member States, as well as on new or renewed rulings in the future. A more detailed discussion of the Commission's rulings is available here.

The US, the UK and Canada—The US Court of Appeals for the Third Circuit entered an order on 9 August 2016 granting petitions seeking direct appeals to the Third Circuit of the US Bankruptcy Court for the District of Delaware's 12 May 2015 decision imposing a pro-rata allocation among US, UK and Canadian creditors of the US$7 billion in proceeds realized from the 2010 sale of the assets of defunct telecommunications giant Nortel Networks Inc. and its affiliates. The Delaware Bankruptcy Court had denied certification of a direct appeal to the Third Circuit, while the District Court had sent the challenges to the Bankruptcy Court's decision to the Third Circuit. The order of the Court of Appeals states that "[o]nce all appeals have been opened, the Court will schedule a management conference with respect to the briefing in these matters".

Noteworthy

Jones Day attorney Jasper Berkenbosch was appointed by a Dutch commercial court as administrator of Amsterdam-based Oi Brasil Holdings Coöperatief UA ("Oi Coöperatief"), a financing subsidiary of Brazilian telecom giant Oi SA, in connection with a suspension of payments proceeding recently commenced for Oi Coöperatief on 9 August 2016 in the Netherlands. Oi SA, Brazil's fourth-largest wireless carrier and the largest fixed-line operator, filed for creditor protection in June 2016 in a Rio de Janeiro court to restructure 65.4 billion reais (US$21 billion) in debt. On 22 July 2016, the US Bankruptcy Court for the Southern District of New York granted a petition filed by the foreign representative of Oi SA, Oi Coöperatief and certain affiliates for recognition under Chapter 15 of the US Bankruptcy Code of the debtors' Brazilian restructuring proceedings.

Jones Day advised Essilor International S.A., a company listed on the Euronext Paris Stock Exchange, in connection with the acquisition of MyOptique Group Limited ("MyOptique"). Based in the UK, MyOptique is an online retailer offering prescription glasses, sunglasses and contact lenses through a number of local websites, such as Glasses Direct (prescription glasses) and SunglassesShop (non-prescription sunglasses) in the UK, Germany and the Nordic countries. MyOptique serves approximately one million active customers.

Jones Day is advising PW Real Estate Fund III, LP, which is advised by Aermont Capital LLP, in connection with the takeover of Pinewood Group plc, the AIM-listed company that owns the iconic Pinewood film studios business. The deal is valued at £323.3 million (US$419.4 million).