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A Sanity Checklist for Existing Financing and a Fund Finance Application of the Luxembourg Professional Guarantee Draft Bill
June 5, 2020 | Issue No. 80

We have two timely articles from Luxembourg law firm SJL Jimenez Lunz this week. In the first article, SJL proposes a quick starting checklist that lenders can run through during COVID-19 lockdowns to determine whether the legal documentation for existing deals is up-to-date or needs to be addressed. In the second, SJL discusses the Professional Guarantee Draft Bill, which has been introduced to the Luxembourg Parliament. This bill introduces a Luxembourg-law-governed guaranty that can be used in security packages for cross-border financing without the risk of requalification. This new form of guaranty will “combine terms of the suretyship (cautionnement) and independent guarantee (garantie autonome) and follow closely the general terms of the security agreements governed by the Collateral Law and their proven efficiency.”

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