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New pension rules for those aged over 55

From 6 April, new pension rules will give people over 55 more freedom regarding how they access their pension savings. Specifically, people over 55 will have the ability to draw an income from their fund at any time they want, or “cash-in” their entire fund.This new power applies only to Defined Contribution schemes. These include both occupational and person pension schemes. If a person has a final salary pension, they will need to transfer their pension to a DV arrangement to take advantage of these changes. Notably this kind of transfer is not available to members of any unfunded public sector schemes such as the NHS Pension scheme.The Government has acknowledged that the person on the street has very little comprehension of pensions. It has created the “Pension Wise” service which will be provided through the Citizens Advice Bureau and made available via the Pension Wise website. Its services are provided free of charge to members of the public. It provides general guidance only and not detailed advice on a person’s specific situation. Some have questioned the utility of a service of this kind, but it is better than nothing and should at least create general awareness.These new rules have followed the roll out of automatic enrolment which has seen over five million working people enrolled in a workplace pension scheme. It seems probable that this new approach to accessing a pension from 55 will increase interest and awareness in retirement savings.These changes may have consequences for the workplace. Some working people may wish to cash in their pensions once they reach 55 to pay down debt or improve their living standards. This may leave little or no money in the fund for their eventual retirement. This may result in these people having to working beyond usual retirement age. This can create an issue for employers.On the same theme, workers with better rates of saving may look to draw down their pension to permit partial retirement, off the back of which they may request flexible working. This also introduces issues for employers who may be obliged to consider and then accommodate such a request.An employer should consider how it communicates information about the change. It should also give thought to whether it will be offered via the employer’s existing workplace pension arrangements to workers.An employer would be best placed to refer workers to Pension Wise in the first instance. However, as noted earlier, it only provides very general guidance. Time will tell what the issues prove to be, but at the very least employers should prepare themselves for potential flexible working requests from staff around the relevant age. Mr. Antony This email address is being protected from spambots. You need JavaScript enabled to view it.
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Protecting your online identity: four tools to protect yourself

We live in the future, and the benefits are legion. Technology such as social media (Facebook, Twitter, Linkedin, Instagram and so on) coupled with mobile communications technology creates a multitude of opportunities to interact positively with a global audience. What is good about it can also be its chief negative. Social media’s potential anonymity, coupled with a desire to harm someone, can be damaging, particularly to a person’s reputation. Harmful behaviour includes blackmail and harassment. The wrongdoer in this instance is likely attempt to cover their tracks by using, amongst other things, a proxy server, fake accounts/ email addresses and disposable hardware such as an unregistered mobile phone. Reputational damage is a key concern because the impact can be immediate whereas mitigating the damage (and removing instances of the offending information) may be a costly and time-consuming process.An easy recent example is the recent high profile hacking of celebrities’ “cloud” accounts, resulting in dissemination of intimate images that were intended to be kept private. Anonymity is the central concept, both from the point of view of the hacker, anyone hosting the images and, generally speaking the people who choose to look at them. In entertainment, an affect person may feel that there is no such thing as bad publicity. The considerations are of course different for a business, for which bad publicity is just that; bad publicity.For a person or business to protect themselves against these kinds of threats is a truly modern problem. One might say there are three aspects to the issue; keeping important information private, what to do when there the information has been compromised and finally what if anything should be done to investigate any such compromise. Here are some things to think about:1. Safeguard important information:Whether you are an individual or a business, have a policy on information security, and consciously implement it. This does not have to cost the earth, and there are a number of readily available, cost-effective tools, including encryption (such as Windows Bitlocker) or “two step authentication” (via a free mobile app such as Google Authenticator). Two step authentication requires the user to enter a code which changes every thirty seconds when he or she logs into an account from a new device for the first time. Popular information and document management systems such as Dropbox and Evernote offer two step authentication using Google Authenticator.2. Don’t just curate your public profile – actively protect it!If you have an internet profile of some kind (via Linkedin, or otherwise) then actively protect it. It is your public message to the world. Ensure to that everything that it published through this channel is professional and “on-message.” This may be less of a concern for an individual. For businesses, managers and owners should consider the extent to which it is appropriate to require employees to reflect their professional personas via social media. This may include a policy on how the company is described on Linkedin, for example (including the use of any brands or logos, etc) and having a policy on making personal statements where there is an apparent link to the company.3. Be ready for the worstConsider in advance how you or your business would react if it was subject to hacking or a sustained attack on your reputation. What would you do if you were locked out of key accounts, or negative information circulated on the internet gained public attention? Have a policy which considers your internal response (resetting passwords, communicating with any websites involved) and an external one, which may include having a pre-existing relationship with a public relations/ communications firm, and a law firm.Fight back!A properly conducted forensic examination coupled with a legal strategy can yield surprisingly effective results. This may involve communicating constructively with internet service providers and social media hosts, together with judicious use of Court applications to require people or organisation to provide information or documents. This can sometimes create a trail which leads to the detection of the wrongdoer. Mr. Sebastian This email address is being protected from spambots. You need JavaScript enabled to view it.
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Key concepts in Islamic Finance

In global terms, the Islamic financial services market is estimated to be worth around one trillion dollars (US). The potential for future growth means that investors are looking for further opportunities presented by Shari’a compliant financial products and services.Islamic principles are known as Shari’a. They are based on a number of sources including the Holy Qu’ran and Sunna, the living tradition of the Prophet Mohammed. Over time, Islamic financial structures have been developed in line with Shari’a. These are some of the key concepts:Riba (interest)Shari’a holds that money has no value itself, which is to say it holds no intrinsic value. It only facilitates an exchange of things that do have value. The payment and receipt of interest (riba) under Islamic law is prohibited and any obligation to pay interest is considered to be void. Shari'a stipulates that any return to a financier be earned by way of profit.Maisir (speculation)According to Shari’a, any contract that involves speculation is void. This does not forbid the general commercial uncertainty which is a facet of most commercial transactions. Instead, Shari’a forbids speculation which is in the nature of gambling. The question is whether something arises from productive effort or force rather than chance. In commerce, the distinction may often be a fine one. Each transaction will need to be considered on its own merits.Uncertainty (gharrar)Shari’a is concerned with any fundamental aspect of a contract which is not agreed with sufficient certainty. This will render is void. Fundamental terms are the usual suspects of subject matter, time for delivery, or price. The English legal approach of ascertaining whether there is some kind of machinery by which the uncertainty can be cured is not taken.Another relevant aspect is that Shari'a does not permit uncertainty in the subject matter of a contract. A insurance arrangement in its standard form is prohited on the basis of, amongst other factors, uncertainty (gharrar) as to whether the relevant insured event will happen or not.Unjust enrichmentA contract where one party is deemed to have made an unjust gain at the expense of another is also considered to be void. It is not always clear what may amount to unjust enrichment of this kind and each transaction must be considered individually. The principle of unjust enrichment includes undue influence by one party over another.To comply with Shari'a law a number of financing techniques have been developed. These include:Murabaha (cost plus financing)This is evident in trade financing contracts. The financier will purchase the asset from the supplier (either directly or indirectly via an agent) and will then on-sell the asset to the client at an agreed marked-up price. The financier may hold title to the asset for only a short period. The profit generated by the financier is nonetheless thought of as a profit derived from a sale of goods transaction. It is not therefore prohibited as interest paid on monies lent (riba).Ijara (lease)This may be thought of as a medium between a conventional operating and finance lease.Rental payments under an ijara will reflect an agreed profit element and comparisons with rentals on conventional leases can be made easily. Different a finance lease contract, obligations such as insurance or undertaking maintenance to the leased asset remain with the lessor. The lessee will only remain responsible for the payment of rent for as long as the asset is being used. If the lessee is no longer able to use the asset – if it is destroyed, for example – then the obligation to pay rent will end. Mr. Ruhel This email address is being protected from spambots. You need JavaScript enabled to view it.
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Involved in civil litigation? Fail to mediate at your peril

In the case of PGF II SA v OMFS Company 1 Limited [2013] EWCA Civ 1288, Lord Justice Briggs found the dispute “eminently suited to mediation”. Claimant PGF’s offer to mediate was not taken up by the defendant, which Briggs LJ determined was an “unreasonable refusal” to mediate, requiring a costs sanction. The case now stands for the proposition that or a failure to respond to an offer to mediate may expose a litigant, including a successful one, to a potential costs order.Some commentators say that judicial attitudes in general are changing, as lawyers coming to the bench now will have had more exposure to mediation in their own practice. It is also said that in certain kinds of civil litigation, particularly commercial litigation, mediation is now almost obligatory. Consider the recent case of Northrop Grumman Mission Systems Europe Ltd v BAE Systems (AI Diriyah C4I) Ltd (No 2) [2014] EWHC 3148 (TCC) where Mr Justice Ramsey held that it was unreasonable for BAE, the successful party, to refuse to mediate. On the facts of the case, this did not result in BAE paying costs, but arguably it lost the potential benefit of an earlier settlement offer on costs, so there was a sanction of some kind.There are trends in mediation practice which may make it increasingly attractive to potential participants. One of them is flexibility which may involve adapting or inventing the process to be used for a particular dispute. This may permit more time to be spent on others, which stands in contrast to a trial where all allegations must be proved an in a sense enjoy equal airtime. This may also lead to costs-savings, permitting parties to be robust and pragmatic when it is to their mutual advantage.There is a growing realisation that mediation can be successful by recreating the atmosphere of a settlement on the steps of the Courthouse. These circumstances are not so much trepidation about the judge and the slings and arrows of a trial so much as a gathering together of key stakeholders who have been briefed on the risks of litigation and have the requisite authority to make decisions.Cutting against the characterisation of mediation as being increasingly part of the ‘litigation’ process, is a structure that can remove some of the heat of the disagreement at the start. Stephen King of Payne Hicks Beach explains: ‘I have noticed an increased use of dispensing with a joint opening session, in circumstances where emotions run high and where clashes can stoke up the fire rather than lead towards a resolution.’ It is a practice noted by others.As with anything, mediation is in a state of on-going evolution. Some have noted a rise in evaluative mediation; where the mediator offers a view on the arguments. The Manchester Technology and Construction Court’s offer a judicial mediation pilot project, where judges act as mediators. They tend to be more evaluative in their style. There are some indications of success in the pilot.The Courts are moving closer and closer to compulsory mediation. Where an offer to mediate is made, it must be taken seriously. Where there is a refusal and the issue of costs is raised consequently, it will be necessary to show cogent reasons why the refusal was justified. Mr. Antony This email address is being protected from spambots. You need JavaScript enabled to view it.
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Is your pension available to creditors?

The English High Court has ruled that a trustee in bankruptcy should not be permitted to have access to a bankrupt person’s pension scheme savings to discharge debts before the pension becomes payable.The Court has ruled that the Insolvency Act 1986 does not give the Court the ability to issue an “Income Protection Order” (“IPO”) against a pension for which payments had not yet begun. This ruling was out of line with an earlier decision, so the issue may not be regarded as settlement until it is considered by the Court of Appeal.Pension providers will most likely believe the decision was the correct one to make in the circumstances. The general effect of the legislation is to protect pension money from a trustee in bankruptcy unless the person has already started to receive payments under his or her pension. A 2012 case indicated that a Court could compel a bankrupt member of a pension scheme to exercise an option to begin to be paid a pension not yet accessed. There has been a certain amount of disapproval of this earlier decision.It is commonplace for savers to have the right to take some benefits from age 55. As a consequence, the trustee in bankruptcy may, potentially, have access to this money. Further, from April this year, scheme participants will have significantly greater freedom to “cash out” their pension.Under the relevant provision of the legislation, a trustee in bankruptcy may apply to the Court for an IPO to receive income from the bankrupt’s estate for a particular period of time. A Court may make an IPO in respect of any income a bankrupt is entitled to receive, including pension payments.In the case at hand, the trustee had applied to the Court for an IPO against various pension policies held by the bankrupt. None of them were payable. One had a large sum of money.In its decision the Court noted that before the earlier decision, HMRC and other government bodies treated pensions that were in payment, and those that were not yet in payment, differently. He attributed this to the fact that once a pension is in payment, the sums payable will be known, whereas before a pension is in payment, the sums to be paid are uncertain. It also can involve a number of elections on the part of the pension holder.The Court stated:Mr Henry is not entitled to payment under his pensions 'merely by asking for payment'. There is a considerable variety of options open to him. It would only be after he had made elections that any payment would be due to him. Only then would he become entitled to any payment. I do not consider that there is any power in the court under section 310 or in the trustee to require Mr Henry to elect in any particular way.In effect then, the bankrupt’s pension was not “brought forward” to make it available to creditors. Until the Court of Appeal determines the issue, there will be uncertainty about whether this reflects the correct position at law. Mr. San This email address is being protected from spambots. You need JavaScript enabled to view it.
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