LMA adds secured option to its suite of South African Facility Agreements and Zambian law option to its Sub-Saharan African Facility Agreement16 June 2015
The Loan Market Association (LMA) is pleased to announce the launch of:
- a new secured single currency term facility agreement governed by South African law. The accompanying User Guide to the suite of South African law facility agreements has also been updated; and
- a new version of its recommended form of facility agreement for use in East Africa (Kenya, Tanzania and Uganda) and Nigeria, to incorporate Zambian law. The accompanying User Guide to the facility agreement has also been updated.
These documents were produced in response to demand from LMA members active in the relevant jurisdictions. They are also reflective of the significant opportunities for growth and investment present within these regions.
Whilst it was recognised that it is difficult to produce a "one size fits all" document for any particular jurisdiction, LMA members operating throughout the African continent felt that the basic formulation of standard form templates incorporating key local law concepts relevant to certain African countries would be a significant step forward in achieving greater efficiencies and standardisation across the market, by providing a common framework and language for those involved in these transactions. The LMA believes that this will enable market participants to concentrate on the key commercial drivers and structural nuances which form the basis of their transactions.
Both documents use the same "boilerplate" as other forms of LMA facility agreement and so should be immediately familiar to all users of LMA documentation.
Each document was agreed by an experienced working party, including representatives from banks (including in-house lawyers) as well as local and international law firms active in the relevant jurisdictions.
Commenting on the documents, Clare Dawson, LMA Chief Executive, said:
"The provision of finance in Sub-Saharan Africa now forms an increasingly significant part of the syndicated loan market and is a key contributor to economic growth. The LMA remains committed both to fostering liquidity in this region and assisting its members who are active in the market. We believe that continuing to extend our suite of documentation to incorporate key local legal regimes is an excellent way of achieving these aims."