What knowledge gap in the market prompted you to write the book?
I have been aware for a number of years there was no book in the market that dealt comprehensively with trade and commodity finance.  Indeed, I had been approached over the years to fill that gap.  The idea has been to produce a Practitioner’s book rather than a book that was a series of legal treaties on legal issues.  I have been helped greatly by members of my Trade and Commodity Finance team, both present and past, and some of my partners in the firm in writing some of the related and specialist issues.  It seemed appropriate that the SNR Denton Trade and Export Finance team should write this book as we hold awards from the three major trade finance publications as Best Trade Finance Law Firm and also top rated by two of the major legal publications.Why is this book different to any other trade finance publication currently available?
The book is different in that it takes an approach on a subject-by-subject basis of how people in the trade finance world would look at financing of trade and ancillary issues.  It deals with each of the financing subjects either as a separate chapter or by a section in a chapter looking at a particular aspect.  Thus, all types of financing structures are looked at in Chapter 2 and specific types of financing like warehouse financing and commodity ownership structures are dealt with in further chapters (5 and 7).  In addition, the book looks, from a practical point of view, at letters of credit, the taking of security, securitisation etc.  There are books that are devoted to very specific legal issues like letters of credit, bills of exchange, but the analysis is very much of the law and cases.  This book is different in that it applies the legal principles to develop practical solutions.How have post-credit reforms impacted on trade finance?
If you look at Basel III as dealing with banks post the 2008 credit crisis then there is likely to be an adverse impact on trade finance unless further changes are made.  Some changes which lessen the problems in relation to letters of credit have already been made.  Basel II with certain exemptions for commodity finance will continue to apply but trade finance as a product will not be exempt from more severe capital adequacy and equivalent requirements currently being implemented.  In addition, other legislation (including legislation in the United States) which treats contingent obligations like letters of credit and participations in transactions as if they were derivative-type instruments will also impact adversely on trade finance.  The response by the industry is gathering momentum.  There are moves by the ICC to demonstrate how low loan losses are in trade finance.  BAFT-IFSA are dealing with better treatment for trade debt.  All of this may well help trade finance going forward.  Whilst the book was published before any of these were finalised, there are references in the book and particularly in the regulation chapter (Chapter 12) which foresee a number of the issues.In your opinion, what has been the most significant development in the industry recently?
The development is as I have outlined above, which is an awakening by the industry that the amount of trade finance could well be reduced unless regulations are changed.  This will have a hugely detrimental effect on world trade and the financing of it.  Ultimately this falls disproportionately on SMEs (small and medium-sized enterprises) around the world and particularly in the emerging markets.  Thus, the pressure to see change that stabilises or increases the amount of trade debt is the most significant development.What are the biggest challenges facing the trade finance industry?
The regulations and reforming them, together with the continued process of arguing that financial institutions should put more money into the trade finance business.  The statistics being promulgated demonstrating that trade finance is good business in that losses are relatively small will help.  However, if trade finance is in competition within financial institutions for funds there will be issues about the return that a bank might make on its trade finance book compared to speculative transactions.  This will be a major challenge to the industry.  If, however, the battle is won regarding the treatment of trade finance both by the regulators and in insolvencies then there could be and should be a huge growth in the trade finance business in its wider sense.  This will enable increases in world trade to be supported.