Credit And Political Risks, Surety

The Firm assists Italian and foreign primary insurers in consulting and advising coverage issues related to credit risk as well as in disputes against their assureds or third parties.

In particular, the Firm assists in the process of identification and evaluation of risks from a legal perspective and, more generally, in preparing feasibility projects customized on different possible scenarios applied to the insured’s business activity. Assists insurers and insureds in case of payment defaults following insolvency of the debtor and negotiation of moratorium agreements related to payments, embargoes and other likewise international restrictions determined by governments and public bodies freezing regular supply of goods and services or investments of financial nature.

Among those cases recently dealt with, we mention the following:

• Legal assistance in Court of primary insurers in relation to guarantee actions against the Guarantor in procurement contracts;
• Legal pre-litigation assistance in relation to credit risk policies and to policies connected with the “risk of confiscation and construction of materials and plants” in the context of foreign sub contracts;
• Legal assistance in Court of primary insurers in connection with credit risk policies against payment default risks of commercial invoices;
• Out and In Court assistance of a primary insurer in relation to Joint Venture guarantees such as Bid Bond; Performance Bond; Maintenance Bond; Supply and Service Bond;
• Legal assistance in connection with disputes arising out of warranty bonds to guarantee contractually defined performances;
• Legal assistance in credit collection activity – in Italy and abroad – both in and out of court, including any issue related to insurance premiums as well;
• Assistance in negotiating and settling issues related to subrogation;
• Court assistance on behalf of insurers in cases of fraudulent or abusive enforcement of performance bonds or surety, including pre litigation remedial actions such as freezing orders or court injunctions;
• Advice on issues related to the nature of the credit (whether privileged or not) in the context of bankruptcy procedures;
• Court assistance on behalf of insurers in the context of opposition to Court injunctions required by the assured following insolvency of foreign opponents parties;
• Assistance during phrasing and negotiation of guarantees and bonds and in any enforcement phase of the same;
• Assistance during any conciliation or mediation procedure related to policy disputes.

In the context of the political risk insurance, our Firm assists the insurer and the assured in events of political nature leading to company’s assets confiscation or to the threat of this occurring, including funds transfer freezing (profits, dividends or international transfers), governmental oppositions, damages to property following riots, civil wars or import-export Government restrictions imposed upon suppliers and clients.

In such activity, the Firm avails, where necessary and agreed with Clients, of the expertise of its international partners within the Global Insurance Law Connect network, having similar expertise in their own respective jurisdictions within the political risk context. The Firm is also named in some international insurance binder as consultant for Italy in Kidnap & Ransom covers and cooperates actively with domestic and international intelligence companies specialized in such sector. For more information on this area of business, please contact Alberto Batini in the London office.