JTC has bolstered its cross-border corporate services offering by launching a range of escrow services for global public and private companies.
Designed to complement JTC’s existing range of international corporate services, the new escrow services, where assets and funds can be held independently and safely during a transaction, will help its clients mitigate financial risk, particularly when a transaction may involve one or more parties located in different jurisdictions, and provide an enhanced level of speed, accuracy and security.
The new services have been launched in order to meet the needs of companies undertaking transactions in an increasingly complex and sophisticated environment. A number of different escrow services will be available as part of the new offering, including wire transfer and deposit services, good-faith deposits for mergers and acquisitions, indemnity deposits, collection of split fees from joint ventures, litigation and arbitration awards and private transactions involving family offices or high-net-worth individuals.
An escrow agreement can cover a range of different types of risk, including:
Counterparty risk, where one party is concerned that the other party will be unable to meet its obligations and funds can be held in escrow until one or both parties meet certain conditions.
Price risk, where there is difficulty in valuing an asset and the price differential can be held in escrow until actual performance can be measured.
Execution risk, where parties wish for a transaction to be executed according to a pre-agreed sequence of events and funds can be held in escrow and released in an appropriate sequence.
In addition, JTC will work closely with a panel of world leading banks in order to negotiate preferential interest rates on deposits held in escrow.
Group Head of Corporate Services at JTC, Stuart Pinnington, said:
“Historically law firms have held clients’ funds on account for a particular transaction. However, due to increasing risks in the modern global corporate environment and shifting client requirements, using an expert escrow agent is becoming increasingly preferable. Managing risk is highly important for companies
when closing transactions. With JTC spanning such a broad number of jurisdictions, we have worked to ensure we have the right expertise to administer all types of escrow agreements, regardless of complexity, which can be seamlessly coordinated with our other services.”
Now represented in 18 jurisdictions, JTC is a multi-jurisdictional, independent provider of corporate, private client and fund services.