跨国交易的风险.pptVIP

Company LOGO Risk in Cross-Border Transactions: The Wells Fargo v.Citibank Case Company Introduction Wells Fargo CitiBank LEGAL BATTLE Wells Fargo VS Citibank CAUSES In June 1983 WFAL made two six-month deposits of 1 million each with Citibank’s Manila branch . On October 15, 1983, the Philippine government imposed exchange controls requiring prior approval by the central bank for repayments of principal on foreign obligations to foreign banks. Add YourIn December 1983, Citibank did not repaythe deposits when matured . In February 1984, Wells Fargo took legal action. SOCIAL VIEWPOINT The WFAL deposits were booked in the Philippine and thus subject to the sovereign risk of the Philippines. For Citibank (Manila or New York) to have repaid the deposits at maturity without government approval would have flouted the spirit and possibly the letter of the Philippine law. FOCAL POINT Was the matter a question for Philippine or New York using its worldwide assets, would this contravene the Philippine exchange control law? TENDENCY The Department of State, the U.S. Treasury, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the office of the Comptroller of the Currency, and the Solicitor General filed a friend-of-the-court brief supporting Citibank. The U.S. circuit court finally ruled in favor of Wells Fargo on June 26, 1991. JUDGMENT ` 1 ` 2 ` 3 REASONS WFAL could have stipulated that collection on its Manila deposits. Be made at Citibank (New York) , in effect demanding a parental guarantee on repayment of the deposits. If this had been done, presumably the rate ofinterest on Citibank (New York) . The court found that Citibank had not satisfied its good faith obligation to seek the Philippine government’s approval to repay the WFAL deposits. The Citibank branch in Manila was not a separate Legal entity, Ph