A Greek diaspora bond odyssey | FT Alphaville

A Greek diaspora bond odyssey

Filed to the SEC on Tuesday — Greece’s shelf registration for the diaspora bonds aimed at widening the Hellenic Republic’s investor base. All the way to the US.

A key point — regarding jurisdiction:

The fiscal agency agreement and the securities will be governed by, and interpreted in accordance with, the laws of the State of New York, without regard to principles of conflicts of law (other than Section 5-140 of the General Obligation Law of the State of New York) except with respect to authorization and execution by the Hellenic Republic of the fiscal agency agreement and the securities, and any other matters required to be governed by the laws of the Hellenic Republic…

The Hellenic Republic will irrevocably submit to the jurisdiction of any state or Federal court in New York City with respect to any action arising out of or based on the securities of any series which may be instituted by any holder of a security of such series.

And yet (from the risk factors section) :

The Hellenic Republic is a foreign sovereign state. Consequently, it may be difficult for investors to obtain or realize upon judgments of courts in the United States against the Hellenic Republic.

And one more (big) risk:

The securities will contain provisions regarding acceleration and voting on amendments, modifications, and waivers, which are commonly referred to as “collective action clauses.” Under these provisions, certain key terms of the securities of any series may be amended, including the maturity date, interest rate, and other payment terms, with the consent of the holders of 75% of the aggregate principal amount of the outstanding securities of such series. See “Description of Securities—Amendments and Waivers” in this prospectus.

Lots more (including a brief rundown of Greece’s economic history) in the full thing.

Related links:
Greece files with U.S. regulator for “diaspora” bonds – Reuters
An Egyptian diaspora bond? – FT Alphaville