Лектори докладно проаналізували разом з учасниками Corporate Compass, а саме:

1. Constructive Trust as a Remedy for Breach of Fiduciary Duty: Конструктивний траст, як засіб правового захисту за порушення фідуціарного обов’язку.

1.1. Introduction. The Nature of Constructive Trust (Вступ. Правова природа конструктивного трасту).

1.2. Breach of Fiduciary Duty as a Trigger for Declaring a Constructive Trust (Порушення фідуціарного обов’язку: основа для оголошення конструктивного трасту).

1.3. Leading Cases (Ключові прецеденти).

2. Conflicts of Interest.

2.1. Understanding the Concept – загальна характеристика.

2.2. Identifying and Assessing Conflicts – Виявлення та оцінка конфліктів.

2.3. Managing and Preventing Conflicts – Управління конфліктами та їх запобігання.

2.4. Ethical and Legal Consequences - Етичні та правові наслідки.

3. Corporate code of ethics. Корпоративний кодекс етики.

3.1. Vocabulary. Словник.

3.2. Company governance. Корпоративне управління.

3.3. Key Takeaways. Основні тези.

3.4. Understanding the purpose of a Сode of ethics. Розуміння цілей Кодексу етики.

3.5. What a corporate Сode of ethics includes. Що містить Корпоративний Кодекс етики.

3.6. Why a Сode of ethics is important. Чому важливий Кодекс етики.

3.7. Steps to creating an effective Сode of ethics. Кроки до створення ефективного Кодексу етики.

3.8. Case. Violation of the Booking.com Code of corporate conduct. Кейс. Порушення Kодексу Kорпоративної поведінки Booking.com.

3.9.  References. Посилання.

4. M&A Essentials 2025–2026: Negotiation Strategies, Due Diligence Red Flags & Effective Risk Management.

4.1. Introduction to M&A in 2025–2026 (Тренди ринку, типові етапи угоди, ключова лексика та документи).

4.2. Negotiation Strategies in M&A Transactions (Приклади моделей переговорів).

4.3. Due Diligence: Identifying Red Flags (Аудит – Legal red flags).

4.4. Drafting Essentials: Reps & Warranties, Indemnities, Limitation of Liability (Структура та мова положень, що вважається “market standard” у UK/US практиці, приклади формулювань).

4.5. Risk Management & Deal Closing (Механізми зниження ризиків та закриття угоди).

У рамках характеристики Corporate Compass акцентовано на наступному:

1. Constructive Trust as a Remedy for Breach of Fiduciary

1.1. Introduction. The Nature of Constructive Trust

 Could be imposed by court:

·              Remedy for unjust enrichment;

·              Remedy for the breach of fiduciary duty.

Institutional: arises automatically by operation of law from a set of defined circumstances, existing independently of any court order.

 Remedial is a discretionary judicial remedy created by court order to prevent unjust enrichment or achieve fairness. While jurisdictions like the USA and Canada favour the remedial model.

 Legal consequences of constructive trust:

 ·              transfers the legal ownership of property to the rightful owner.

·              the person holding the property becomes a trustee, obligated to manage it for the benefit of the true owner.

1.2. Breach of Fiduciary Duty as a Trigger for Declaring a Constructive Trust 

 Fiduciary duty:

 1)           Could be owed by:

 2)           Director (de jure, de facto, “shadow” director).

 3)           Trustee (a person or entity that holds and manages assets on behalf of beneficiaries).

 4)           All others fiduciaries company who are (including directors, lawyers, accountants etc).

Nature of fiduciary duty:

·              Bristol & WestBuildingSocietyv Mothew[1998]Ch;

 The question before the Court of Appealwas: whether a solicitor, who was acting both for a lender and borrower, was in breach of a fiduciary duty in circumstances where the solicitor had given incorrect advice to the lender?

 ·              Bristol & WestBuildingSocietyv Mothew[1998]Ch:

A fiduciary must:

 1 act in good faith;

2 not make a profit out of his trust;

3 not place himself in a position where his duty and his interest may conflict;

4 not act for his own benefit or the benefit of a third person without the informed consent of his principal.

 This is not intendedto be anexhaustivelist, but it is sufficientto indicatethe nature of fiduciary obligations'

Dominant elements:

 ·              Duty of care (Duty to exercise reasonable care, skill and diligence)– s.174.

·              Duty to avoid conflicts of interest (s.175).

·              Duty not to accept benefits from third parties (s.176).

Case review PrimlakeLtd v Matthews Associates & Others [2006] EWHC 1227:

 ·              Високий суд виніс рішення на користь Primlake Ltd, встановивши, що пан Деррік Метьюз, діючи як фактичний директор, порушив свої фідуціарні обов'язки, організувавши несанкціоновані платежі собі та Matthews Associates Ltd. Ці платежі, на загальну суму законного приблизно 836 500 фунтів стерлінгів, були визнані незаконним збагаченням, отриманим без обґрунтування. Суд визнав, що пан Метьюз діяв недобросовісно, ​​використовуючи своє становище для отримання особистої вигоди за рахунок Primlake. У рішенні наголошується на суворих зобов'язаннях, які фактичні директори мають перед компаніями, якими вони керують, підкреслюючи, що несанкціоновані дії, особливо ті, що призводять до особистого збагачення, є порушеннями фідуціарних обов'язків, що дають підстави для позову. Суд надав Primlake Ltd конструктивний траст на спірні кошти та зобов'язав пана Метьюза повернути несанкціоновані суми, посиливши правові механізми, доступні для захисту компаній від внутрішньої експлуатації.

1.3. Leading Cases (Ключові прецеденти).

 1)           Keech v Sandford 1726: Trustee отримав оренду, яку не можна було оновити на бенефіціара, і прийняв її для себе. Фідуціар не може отримувати вигоду з довірчої позиції, навіть якщо бенефіціар не міг сам отримати вигоду. Засадничий прецедент “noprofit rule”, абсолютна лояльність фідуціара.

2)           Boardman v Phipps 1967: Trustee та консультант трасту купили акції на основі довіреної інформації, отримавши прибуток. Навіть добросовісна дія не дозволяє фідуціару зберігати прибуток; прибуток утримується на constructive trust. Підтверджує суворий стандарт поведінки фідуціара, вводить концепцію equitable allowance для добросовісних фідуціарів.

3)           FHR European Ventures LLP v Cedar Capital Partners 2014: Агент отримав комісію при угоді від імені клієнта. Secret commission отримана фідуціаром підлягає constructive trust на користь принципала. Підтверджує, що profit, отриманий через фідуціарний обов’язок, завжди належить бенефіціару; сучасне закріплення принципу “nosecretprofit”.

2. Conflicts of Interest.

2.1. Understanding the Concept – загальна характеристика

 Аconflict of interest (СОІ) -is a situation where personal interests could potentially influence professional duties, whereas corruption is the actual abuse of power for private gain.

 Conflict of interest ≠ corruption.

2.2. Identifying and Assessing Conflicts – Виявлення та оцінка конфліктів

 We must distinguish the typology:

·              Actual conflict;

·              Potential conflict;

·              Perceived (apparent) conflict.

2.3. Managing and Preventing Conflicts – Управління конфліктами та їх запобігання

 A strong outcome:

1)           Conflict of interest is not about eliminating personal interests - it is about ensuring that private interests do not distort public or professional judgment.

2)           In contemporary legal systems, it is not enough for decisions to be impartial - they must also be capable of being trusted as impartial, both now and in the future.

NOTE: You cannot always avoid a conflict—but you must manage it properly.

A classic example: is when a board member participates in approving a contract between the company and another business in which they hold a financial stake. Even if the deal seems fair, the director’s impartiality is compromised by personal interest.

In essence, it’s the tension between fiduciary duty (to act loyally and in the best interests of the company) and self-interest (to gain personal benefit).

2.4. Ethical and Legal Consequences - Етичні та правові наслідки

Corporate law systems usually address such conflicts through mechanisms like:

·              Duty of loyalty and duty to avoid conflicts (core fiduciary principles).

·              Disclosure requirements to inform the board or shareholders of any potential conflict.

·              Recusal or abstention from decision-making in the conflicted matter.

·              Corporate governance policies ensuring transparency and oversight.

3. Corporate code of ethics. Корпоративний кодекс етики

 A corporate code of ethics is a formal document outlining the principles, values, and standards that guide an organization's decision-making and behavior to ensure honesty, integrity, and responsibility.

3.1. Vocabulary. Словник

·              Trouble-making – порушення громадського порядку.

·              Company governance – корпоративне управління, управління компанією, принципи управління компанією.

·              Fairness – безсторонність, добросовісність, неупередженість, рівнодоступність, незаплямованість, чесність.

·              Fall under the umbrella – підпадати під сферу (під дію), належати до сфери, підпадати під захист.

·              Core Values – основна вартість, основні (головні) цінності.

·              Business Conduct – ведення бізнесу, дулова (корпоративна )поведінка, ведення справ.

·              Golden parachute – золотий парашут (договір наймання з керівниками компанії, що передбачає виплату їм значної компенсації у випадку зміни контролю над компанією і/або звільнення).

·              Forfeit – штраф, витрати, відмовитись, конфіскований.

3.2. Company governance. Корпоративне управління

 Company governance:

·              Ethics

·              Structure

·              Compliance

·              Standards

·              Management

·              Risks

·              Audit

·              Responsibility

3.3. Key Takeaways. Основні тези

·              Set of guiding principles that help professionals conduct business with honesty and integrity.

·              There are different types of codes of ethics, including compliance-based, value-based, and professional codes, each serving specific purposes.

·              A code of ethics is crucial for fostering ethical conduct, protecting a company's reputation, and guiding decision-making that impacts stakeholders and the environment.

·              Codes of ethics often include industry-specific regulations and guidelines, ensuring companies adhere to legal and ethical standards.

·              Having both a code of ethics and a code of conduct helps organizations maintain integrity and professionalism within their operations.

3.4. Understanding the purpose of a Сode of ethics. Розуміння цілей Кодексу етики

 Business ethics refers to how ethical principles guide a business’s include operations. Common issues that fall under the umbrella of business ethics employer-employee relations, discrimination, environmental issues, bribery, insider trading, and social responsibility.

3.5. What a corporate Сode of ethics includes. Що містить Корпоративний Кодекс етики

·              CoreValues: Principles like integrity, honesty, respect, responsibility, and fairness.

·              Ethical Principles: Specific guidelines for behavior, such as workplace safety, environmental responsibility, and diversity, equity, and inclusion.

·              Business Conduct: Standards for financial and accounting practices, protection of intellectual property, and regulatory compliance.

·              EmployeeConduct: Expectations for professional standards, professional competence, and respectful interactions with colleagues and clients.

·              Reporting Mechanisms: Procedures for reporting unethical behavior and addressing violations of the code.

3.6. Why a Сode of ethics is important. Чому важливий Кодекс етики

·              FostersTrust and Integrity: It builds confidence among customers, investors, partners, and employees.

·              SetsaStandard: It establishes a clear framework for ethical decision-making and behavior within the organization.

·              GuidesBehavior: It helps employees understand what is expected of them in various situations.

·              EnhancesReputation: A commitment to ethical practices boosts a company's public image and builds brand loyalty.

·              EnsuresCompliance: It helps organizations adhere to laws and regulations and avoid potential legal issues.

·              PromotesaPositive Culture: It contributes to a positive work environment by reinforcing values and setting expectations for ethical conduct.

3.7. Steps to creating an effective Сode of ethics. Кроки до створення ефективного Кодексу етики

 Organizations create codes of ethics to eliminate unacceptable or immoral behavior among their members, often focusing on existing ethical issues within their industry.

 1. Identify the organization’s priorities and key ethical issues.

2. Define the principles and rules that align with these priorities.

3. Draft the code, incorporating feedback from stakeholders.

4. Ensure clarity and accessibility of the document.

5. Implement training programs for employees.

6. Regularly review and update the code to reflect changes in ethical standards or laws

3.8. Case. Violation of the Booking.com Code of corporate conduct. Кейс. Порушення Kодексу Kорпоративної поведінки Booking.com

 The first person of Priceline Group and Booking.com Darren Houston had to resign after the board of directors conducted an investigation into his violations of the code of corporate conduct. The investigation was organized after the board of directors drew attention to the personal relationship of the married CEO with an employee. The employee was not a direct subordinate of Houston. An investigation by the board of directors confirmed that the CEO's actions violated the company's code of conduct, The CEO admitted to the violation and wrote a letter of resignation. Under the terms of the agreement, he is now ineligible for a ‘golden parachute’ and must forfeit at least $15.3 million in compensation.

3.9.  References. Посилання

1)           Schwartz, M.S., via Springer Link. “A Code of Ethics for Corporate Code of Ethics. Journal of Business Ethics 41, 27–43 (2002).”

2)           Harvard Business School Online. “What Are Business Ethics & Why Are They Important?”

3)           Association of International Certified Professional Accountants. “Code of Professional Conduct,” Pages 5–7 (Pages 9–11 of PDF).

4)           U.S. Securities and Exchange Commission. “SEC Adopts Rules and Interpretations to Enhance Protections and Preserve Choice for Retail Investors in Their Relationships with Financial Professionals.”

5)           CFA Institute. “Code of Ethics and Standards of Professional Conduct.”

6)           Institute for Business Ethics. “Code of Ethics.”

7)           AICPA & CIMA. “Code of Ethics at a Glance.”

8)           National Education Association. “Code of Ethics for Educators. ”

4. M&A Essentials 2025–2026: Negotiation Strategies, Due Diligence Red Flags & Effective Risk Management.

4.1. Introduction to M&A in 2025–2026 (Тренди ринку, типові етапи угоди, ключова лексика та документи)

Market trends (2025–2026):

·              M&A is increasingly driven by Artificial Intelligence (AI).

·              Around one-third of major deals involve AI capabilities.

·              Companies prefer acquiring AI expertise rather than building it internally.

·              Focus has shifted from scale to technology acquisition and data infrastructure.

Definition of M&A:

·              Mergers and Acquisitions (M&A) refer to processes where companies combine or purchase other companies.

·              A merger: two companies form a new entity.

·              An acquisition: one company buys another (which may remain independent).

Typical stages of an M&A transaction:

1.            Strategy & target identification.

2.            Initial contact & preliminary negotiations (NDA, LOI).

3.            Due diligence.

4.            Deal structuring.

5.            Regulatory & shareholder approvals.

6.            Negotiation & documentation (SPA, warranties, indemnities).

7.            Closing.

8.            Post-merger integration.

Key vocabulary & documents:

·              SPA (Share Purchase Agreement).

·              APA (Asset Purchase Agreement).

·              LOI (Letter of Intent).

·              NDA (Confidentiality Agreement).

·              Due Diligence.

·              Valuation.

·              Closing.

·              Target Company.

·              Conditions Precedent.

4.2. Negotiation Strategies in M&A Transactions (Приклади моделей переговорів)

 Main negotiation models:

·              Fisher & Ury (Interest-Based Negotiation): Focus on common interests and creative solutions → Example: earn-out agreements (payment linked to future profits).

·              Hard Bargaining / Positional: Strict позиційна торгівля with minimal concessions → Example: high price for controlling stake.

·              Mixed-Motive / Hybrid: Combination of cooperation and competition → Example: shared-risk deals.

·              BATNA Analysis: Identify best alternative if no agreement is reached → Alternatives: other buyers, litigation, arbitration, unilateral action.

·              Anchoring / First Offer: First offer sets negotiation framework → Example: initial price 20% above valuation.

·              Concession Planning: Planned → Example: seller reduces price if buyer retains team.

4.3. Due Diligence: Identifying Red Flags (Аудит – Legal red flags)

 Definition:

·              Due diligence = investigation and research to evaluate a potential investment.

Scope of due diligence:

·              Corporate structure and share capital.

·              Ownership.

·              Assets and title.

·              Intellectual property.

·              Regulatory compliance.

·              Employment issues.

·              Environmental issues.

·              Material contracts.

·              Taxation.

Legal red flags:

·              Past, current, or pending litigation.

·              Disputes with employees or directors.

·              Lack of regulatory compliance certificates.

·              Existing judgments against the company.

·              Problematic insurance coverage.

·              Undisclosed liabilities.

Output:

·              Due diligence report (legal findings).

·              Auditor’s report (financial/commercial findings).

4.4. Drafting Essentials: Reps & Warranties, Indemnities, Limitation of Liability (Структура та мова положень, що вважається “market standard” у UK/US практиці, приклади формулювань)

 Reps & Warranties / Indemnities

·              Example clause: “The Seller shall indemnify the Buyer against any losses arising out of breaches of representations and warranties…”

Meaning:

·              Seller must compensate buyer for losses (e.g., tax liabilities, undisclosed debts)

Key drafting elements:

·              Clear structure:

1)           Time trigger (“With effect from Completion”).

2)           Obligation (“Seller shall procure…”).

3)           Legal mechanism (e.g., novation).

4)           Consequences (transfer of rights and obligations).

Market standard:

·              Use of:

1)           Indemnities.

2)           Warranties.

3)           Conditions Precedent.

4)           Limitation of liability (implied через структуру clauses).

Typical clause language:

·              Asset deal: “The Seller hereby transfers and assigns…”

·              Share deal: “The Seller agrees to sell, and the Purchaser agrees to purchase…”

Important concepts:

·              Novation → transfer of both rights and obligations.

·              Assignment → transfer of rights only.

·              Assumption of liabilities → buyer accepts obligations.

4.5. Risk Management & Deal Closing (Механізми зниження ризиків та закриття угоди)

 Risk mitigation mechanisms:

·              Due diligence (primary tool)

·              Conditions Precedent (CPs):

-              Regulatory approvals.

-              Shareholder approvals.

-              No material adverse change.

·              Escrow accounts:

-              Funds held until conditions are met.

·              Indemnities and warranties.

·              Break-up fee (penalty for terminating deal).

Defensive strategies (risk in hostile takeovers):

·              Poison pill.

·              Golden parachute.

·              White knight.

·              Litigation.

Closing (Completion):

·              Transfer of ownership.

·              Execution of final documents.

·              Payment settlement.

·              Release of escrow.

Post-closing:

·              Integration of operations, management, and culture.

·              Realization of synergies.