Thomas Donegan is a partner in the Financial Institutions Advisory & Financial Regulatory practice. Thomas has a broad financial regulatory practice, advising financial institutions, including banks, brokers, exchanges, clearing houses, fund managers, insurers, corporates and other end-users. His work includes advising on legal and regulatory issues arising in clients’ businesses, structuring, regulatory authorizations and licensing, change of control, compliance policies and procedures, client agreements and terms of business, incident management, investigations, enforcement and financial services disputes work.

Thomas has practiced as a specialist financial regulatory lawyer at Shearman & Sterling for 20 years.

Thomas’ clients have included most of the world's major banks including Bank of America Merrill Lynch, Citibank, JPMorgan, Goldman Sachs, HSBC, Morgan Stanley and ZKB, some of the major UK banks. Latin America banks and associations such as Bradesco, Itaú, Banco de Chile, Banco do Brasil and Asobancaria. He also advises market infrastructure providers such as ICE and historically the CME group and Eurex, as well as participants in such markets. His brokerage clients include Oppenheimer and he advises insurers such as Fairfax and Lloyd’s of London participants.

His recent work includes advising clients on dealing with the implementation and impact of the EU/UK regulatory reforms (e.g. EMIR, MiFID II, capital, recovery & resolution, governance, ring-fencing, anti-money laundering issues and shadow banking reforms) and more recently the challenges of Brexit. Thomas was among the team which advised the Abu Dhabi Global Market in the drafting of the laws for its financial centre; he also advises on ADGM and DIFC regulatory matters. He practices contentious regulatory work, recently advising a group of investors who lost their savings to London Capital & Finance plc on securing government compensation and successfully challenging the FCA’s decision on ex gratia compensation.

Advising banks, brokers, financial institutions, exchanges, clearing houses and corporates on business structure, ongoing compliance and other advisory issues

• authorizations and licensing of new businesses
• change of control and management / governance
• client agreements / terms and conditions of business
• policies and procedures
• conduct of business
• regulatory investigations and enforcement matters
• client disputes
• regulatory capital, capital instruments and capital structuring
• scope of regulatory permissions and regulatory perimeter issues
• custody, account, prime brokerage, derivatives, security, collateral and other agreements
• corporate governance, senior managers regime, allocations of responsibility
• data protection
• anti-money laundering and sanctions
• regulatory reporting
• legal opinions and memoranda on regulatory matters

Establishing new financial institutions or financial companies and regulatory approvals

• Zürcher Kantonalbank on its recent establishment and FCA authorization process for a new UK brokerage subsidiary.
• A major UK bank on its post-Brexit European legal entity structuring and booking models.
• Société Générale on its announced joint venture with Alliance Bernstein for their research and securities brokerage businesses.
• Intercontinental Exchange on its partnership with Abu Dhabi National Oil Company and nine of the world’s largest energy traders to establish ICE Futures Abu Dhabi, a new exchange in Abu Dhabi Global Market hosting the world’s first Murban crude oil futures contracts.
• Intercontinental Exchange (ICE) in its establishment of ICE Clear Europe as the first new derivatives clearing house in London since 1880 and ongoing advice on multiple matters since then.
• ICE on its establishment and development of its UK clearing house ICE Clear Europe and its development of new products, including CDS clearing in Europe and the U.S.
  – “Most Innovative work by a Law Firm” in the field of exchange-traded or centrally cleared derivatives (FOW 2009); Structured Finance/Debt Capital Markets Team of the Year (Legal Business, 2010)
• Abu Dhabi National Oil Company (ADNOC) on the establishment and launch of two new trading units: ADNOC Trading and ADNOC Global Trading.
• The Depository Trust & Clearing Corporation (DTCC) on setting up DTCC Derivatives Repository Ltd, their European trade repository.
  – Recognized as “Standout” for regulatory (FT Innovative Lawyers Awards, 2011).
• Société Générale on its joint venture to establish NewEdge and later bringing in house of that business.
• SIX x-clear in becoming the second (parallel) central counterparty for the London Stock Exchange
  – Recognized as ‘Standout’ (FT Innovative Lawyers Awards 2009).

Investigations, enforcement and litigation

• Investors in London Capital & Finance plc on their striving for compensation, including in relation to:
  – a judicial review of the decisions of the Financial Services Compensation Scheme (R v Financial Services Compensation Scheme Limited [2021] EWHC 760 (Admin)), the first time in which the terms of a consumer financial instrument were held to be unfair and unenforceable under the Consumer Rights Act 2015;
  – a complaints process involving an unprecedented number of complainants, in which certain FCA rulemaking and the FCA’s decision not to compensate LCF investors were both held to have been vitiated by legal error, by the Financial Regulators Complaints Commission;
  – an upheld complaint against the Financial Services Compensation Scheme;
  – representations to the Dame Gloster review into regulatory failure by the Financial Conduct Authority;
  – representations to government and advice to investors in relation to the ad hoc compensation scheme ultimately established under the Compensation (London Capital & Finance plc and Fraud) Act 2022.
  – “Highly Commended” at Law Firm of the Year, Peer2Peer Finance Awards, 2022.
• Anti-money laundering advice to clients, including on contentious on-boarding queries, policies and procedures and National Crime Agency (NCA) reporting obligations.
• A shareholder of a major UK bank on an investigation and enforcement process concerning alleged breaches of change of control requirements.
• Two UK custodian banks on FCA investigations relating to client money and client assets issues, both of which were ultimately not enforced following remediation.
• Various financial institutions, their boards and individual directors and executives on conducting internal investigations, implementing compliance programs, regulatory investigations and enforcement and regulatory risk including on issues related to insider dealing, market abuse, market manipulation, disclosure, confidentiality of information, anti-money laundering issues and sanctions compliance.
• ICE Clear Europe Limited, in its successful intervention as a joining party and respondent to a client money dispute in litigation in the English courts between the UK administrator and US bankruptcy trustee of MF Global (In re MF Global UK Limited (2012)) and the settlement of that dispute.
• A consortium of subordinated bondholders in relation to legal challenges concerning the Bank of Portugal’s decision to place Banco Espirito Santo (BES) into resolution.
• A group of fund investors in the Lehman litigation (In re Lehman Brothers Europe).
• A group of fund investors in a contentious regulatory matter related to capital instruments of a major southern European bank.

Structuring and facilitating acquisitions and disposals of financial businesses or holdings in such businesses

• ADNOC on the acquisition of a 25% shareholding in Borealis AG from Mubadala.
• Mubadala Capital on its acquisition, together with Fortress management, of Fortress Investment Group.
• BNP Paribas Personal Finance, in connection with the sale of BNP Paribas Personal Finance Bulgaria to Eurobank Bulgaria.
• Banco Bradesco Europa on restructuring its U.K. office.
• Citi and Bank of America on the SVB and Credit Suisse situations.
• Fairfax on the $1.4 billion sale of its Crum & Forster Pet Insurance Group and Pethealth to JAB.
• Fairfax, together with certain of its controlled affiliates, on the $1.35 billion sale of RiverStone to Gatland Bidco.
• Riverstone on its acquisition of Neon Group from American Financial Group, Inc.
• Sompo Holdings on the financial regulatory aspects of its $6.3 billion acquisition of insurer and reinsurer Endurance Specialty Holdings.
• Fairfax and OMERS on the c.$750 million disposal of Riverstone insurance to CVC.
• Société Générale on its acquisition of Kleinwort Benson Bank Limited and Kleinwort Benson Channel Islands Holdings Limited, the UK and Channel Islands’ wealth management business of BHF Kleinwort Benson Group S.A.
• DBAY Advisors Limited, a private equity fund based in the Isle of Man, on its acquisition of a majority stake in haulier Eddie Stobart as part of the rescue package for that firm, which included an FCA-regulated subsidiary.
• Fairfax Financial Holdings Limited on its £1.22 billion acquisition of Brit plc.
  – ‘Financial Regulation Team of the Year’ (IFLR Europe Awards, 2016).
• Bridgepoint Advisers on its £212 million acquisition of Moneycorp.
• ICE Inc. on its approximately $11 billion acquisition of NYSE Euronext and subsequent carve-out of LIFFE and spin-off of the Euronext continental cash equity markets..
  – “Financial Regulation Team of the Year” (IFLR Europe Awards, 2014).
• A Middle Eastern sovereign group on its acquisition of a significant stake in Barclays Bank plc.
• Citi on its acquisition of ING’s Custody and Securities Services Business across Central and Eastern Europe
  – “Financial Regulation Team of the Year” (IFLR Europe Awards, 2014).
• Citibank in its sale of CEFS, which managed the UK’s Post Office Card Accounts, to JPMorganChase Bank – the first major test of Part VII of the Financial Services and Markets Act 2000 for banking businesses.
• Thomson Corporation on its acquisition of TradeWeb, a UK authorized multilateral trading facility.
• Morgan Stanley on its purchases of various European credit card portfolios and other assets.
• DBAY on its acquisition of a stake in Anexo Group plc.
• Lower Tier 2 bondholders on the first ever creditor bail-in of a U.K. bank without taxpayer support in acquiring 70% of shares in The Co-operative Bank in connection with the bank’s £1.5 billion recapitalization plan
  – “Most innovative law firm in finance law” (Financial Times Innovative Lawyers Awards, 2014); “Financial Regulation Team of the Year” (IFLR100 Europe Awards, 2014).

Derivatives Regulation, Commodities

• A broad range of hedge funds, banks, central banks, development banks and corporates on derivatives clearing, reporting, margin, contractual provisions and conduct of business requirements, including the EMIR, MiFID II package, CRR2 and Basel 3, SFTR and the Dodd Frank Act among others.
• Other legal and regulatory advisory work related to derivatives and commodities – see above.

Legislative drafting

• Abu Dhabi Global Market (ADGM) on its establishment as a new international financial centre in the U.A.E.
  – ‘Financial Regulation Team of the Year’ (IFLR Europe Awards, 2016); “Corporate Team of the Year” (Corporate Counsel Middle East Awards, 2016); “Regulatory and Investigations Team of the Year” (British Legal Awards, 2016).
• A Middle Eastern country on the establishment of a new legal regime within its territory.
• Numerous institutions and infrastructure providers on proposals to amend or introduce new laws and regulations in the UK and elsewhere.
• Active Participation on several Financial Markets Law Committee working groups, including on banking, clearing, financial collateral and emission allowances.

Outsourcings

Advising various institutions on business process, IT and offshore outsourcings, including:

• Citibank to JPMorgan (in relation to the UK Post Office’s Card Accounts)
• WestLB to Hewlett Packard (IT)
• Winterthur to Citibank (fund administration)
• Mercer to Skandia (pension fund investments)
• ICE (intra-group)
• Morgan Stanley (intra-group)

Capital markets offerings and transactions

• Various issuers and most of the main banks and brokers on selling restrictions, stabilization, analysts’ research, ethical walls, market soundings, disclosure issues, Market Abuse Regulation matters and publicity in connection with their equity and debt offerings.
• ICE, as selling shareholder, and Euronext N.V. on the €1.3 billion sale of Euronext’s ordinary shares through an initial public offering and pre-offering placement
  – “Equity Deal of the Year” (IFLR1000 European Awards, 2015).

Professional Affiliations

• Participant in the main UK and continental European financial services market committees for practitioners and market associations (e.g., FMLC, FIA, UK Finance).
• Frequently an invited speaker at conferences on financial services law and regulatory issues.

Awards & Accolades

• Thomas is ranked as a leading individual in Legal 500 UK, which has cited him as being “excellent”, “an exceptional lawyer, very pragmatic” and having a “deep understanding of European regulation”.
• Thomas is currently ranked in Legal 500 UK as a next generation partner for Financial Services: Non-Contentious/Regulatory, and as a leading individual for both Financial Services: Contentious and Derivatives (including Commodities). He is recommended for Insurance: Corporate and Regulatory.
• Thomas is listed as highly regarded by IFLR1000 and is ranked as a recognized practitioner by Chambers UK for Financial Services: Non-Contentious Regulatory, with clients noting “he is an excellent regulatory lawyer and always gets to the crux of the issue," and that "he is exceptional to work with, and he provides high-quality advice with a truly in-depth knowledge."

Publications

• The Effect of Contractual Unfairness Under the Consumer Rights Act 2015 on the Transferability of Bonds Following the High Court’s Decision in R. (Donegan) v Financial Services Compensation Scheme, JIBLR (with others) 2023, Vol. 38(80) p.265-271
• London Capital & Finance Plc—Was It a Collective Scheme?, JIBLR (with others) 2023, Vol. 38(8) p. 272-279
• The UK’s Last Asserted Francovich Claim? On the Regulation of Non-transferable Bonds and the Legal Backdrop to the UK Government’s Compensation of London Capital & Finance Investors, JIBLR (with others)
• London Capital & Finance Plc—A Spotlight on the ISA Regulations and the Need for Reform, JIBLR (with others)
• On the Existence of a Pan-European Reverse Solicitation Regime under MiFID II, and Its Importance Following Brexit, JIBLR (with others) 2021, Vol. 36(5) p. 202-209
• UK Listing Regime Reform - A Major Overhaul of the UK’s Listing and Capital Markets Rules Proposed, Shearman & Sterling LLP
• How Best to Navigate the LIBOR Transition: Challenges and Solutions for Corporate Treasurers and CFOs, Shearman & Sterling LLP
• Financial Services Regulation under the UK-EU BREXIT Deal, Shearman & Sterling LLP
• ESMA’s Post-Brexit Regime for UK Investment Firms Revisited—‘Equivalence’ or Direct Regulation?, Shearman & Sterling LLP
• COVID-19 and the banking sector, Practical Law Company (with Chloe Barrowman) July 2020
• The Abu Dhabi Global Market – Legislative Framework, Approach and Methodology, JIBLR (with others) 2017, Vol. 32(5) p. 181-199
• Legal Risk Management in a Crisis, Shearman & Sterling LLP
• PRIIPS and Capital Markets Transactions: a Better Way Forward? Shearman & Sterling LLP
• Brexit: Significant Opportunities for a Regulatory Reboot, Banking Perspectives, Q3, 2016, The Clearing House (with Barney Reynolds) 2016, Quarter 3, p. 72-78
• Brexit – Opportunity for a Reboot of Financial Regulation, JIBLR (with Barney Reynolds) 2016, Vol. 31(12), p. 613-635
• MiFID II: A cure for all ills, IFLR (with Barney Reynolds and Anna Doyle) Vol. 30, Issue 10 (December/January 2012), pp. 60-61
• FSMA banking business transfers: choosing the right route, PLC (with Barney Reynolds) 2006, Vol. 17(4), p. 37-44
• The pros and cons of UK exchange recognition, IFLR (with Barney Reynolds) Vol. 23, Issue 10 (October 2004), pp. 39-42
• What’s broken with the UK’s client asset and money protections and how to fix it, JIBLR (with Barney Reynolds, Azad Ali, Aatif Ahmad) 2010, Vol. 25(11), p. 529-542
• Protecting the Market, Carbon Finance (with Mehran Massih)