Corporate financing

Corporate financing transactions in Gibraltar are increasingly attractive for international clients due to Gibraltar’s combination of English common law heritage and flexible modern regulatory environment. This article outlines the general legal position structures and specific counsel considerations vital for successful secured financings guarantees and other finance-related corporate transactions in the jurisdiction and how Hassans can add value at every stage.

General Position on Corporate Financing

Gibraltar offers a robust and business-friendly legal system that permits varied forms of corporate finance from secured lending and asset-based financing to unsecured loan facilities and guarantees. Most financings are governed by the Companies Act 2014 applicable financial services regulations and common law principles. The jurisdiction welcomes foreign investors and imposes no restrictions on capital imports or repatriation of earnings making it an attractive hub for cross-border transactions.

Legal Opinions and Transactional Certainty

Legal opinions in corporate finance are a standard requirement from lenders and counterparties to confirm among other things the due incorporation and existence of the borrower capacity and authority and the enforceability of transaction documents in Gibraltar. Well-drafted legal opinions help establish transactional certainty reduce legal risk and are often required as closing deliverables in significant deals.

Security: Documentation and Registrations

Security may be taken over various asset classes including shares real estate receivables machinery vessels and intellectual property. Security documentation (such as debentures charges and mortgages) must be tailored to the asset type and the particular requirements of the transaction. Most types of security must be registered at Companies House in Gibraltar within prescribed periods to be effective against third parties and avoid loss of priority or enforceability.
Ship mortgages for example are registered at the Gibraltar Ship Registry allowing mortgagees to confirm encumbrances and priority interests over vessels.

For most other company charges failure to register can render the security void against the liquidator or creditors if the company enters insolvency.

Guarantees: Structures and Considerations

Guarantees (personal corporate or cross-guarantees) are widely recognised and enforced in Gibraltar provided they are in writing and properly executed by the guarantor. The Companies Act and underlying principles of English law govern guarantee validity and independent legal advice is often recommended to manage risks relating to limitations undue influence or misrepresentation (particularly where directors or associated persons give guarantees).

The Importance of Gibraltar Counsel

Engaging Gibraltar counsel is critical as local legal advisers provide guidance on:
• Compliance with specific statutory requirements (e.g. registration of security limitations on financial assistance regulatory notifications);
• Drafting transaction documents that are valid and enforceable under Gibraltar law; and
• Navigating local disclosure directors’ duties and insolvency considerations that may affect the transaction.

Gibraltar’s legal regime has diverged from the UK making it essential for counsel to carefully review and adapt English-law precedents or templates for Gibraltar-specific issues.

How Hassans Can Help

As the leading Gibraltar law firm we are uniquely positioned to:

• Advise borrowers lenders and sponsors on all aspects of corporate and asset finance including structuring due diligence and regulatory compliance;

• Draft and negotiate transaction documents including facility agreements security and guarantee documents and deliver robust legal opinions tailored to lender requirements;

• Coordinate the registration of security interests at Companies House the Ship Registry or other relevant registries; and

• Advise on transaction risks directors’ duties and insolvency implications ensuring all local legal intricacies are considered and mitigated.

Our experience commercial awareness and detailed knowledge of the evolving Gibraltar legal landscape allow us to deliver practical swift and cost-effective solutions for international and local clients alike. Contact our Partner Matthew Torres on matthew.torres@hassans.gi to discuss how we can support your financing or security transaction ensure compliance and safeguard your interests.