Escrow Services

Escrow services are primarily used to mitigate financial risk - critically important when closing transactions, especially when one or more parties are located in different jurisdictions. Different types of risk covered include:

• Counterparty risk – where one party is concerned the other will be unable to meet its obligations. Funds are held in escrow until one or both parties meet certain conditions.
• Price risk – where there is difficulty in valuing an asset. The price differential may be held in escrow until actual performance can be measured.
• Execution risk – where the parties wish for a transaction to be executed according to a pre-agreed sequence of events. The funds are held in escrow and released in an appropriate sequence.

Selecting a responsive and reliable escrow provider is a primary concern for all, and yet escrow arrangements are often the last consideration in a long, intricate process. Appleby’s offshore fiduciary service teams provide quick turnaround on escrow agreements - enabling deals to close on time.

Acting as an independent third party, Appleby’s fiduciary team will make the necessary arrangements to hold assets in escrow and disburse them only when a predetermined condition is met. Our services are accurate and secure. While escrow deposits are usually cash or securities, they may also comprise title documents, accounts receivable or even source codes or formulas.

In addition, our associated global law firm can be, but need not be, involved in the principal transaction generating the need for escrow services. If required, our lawyers can provide contractual guidance and advice in accordance with the governing laws of the major offshore jurisdictions.

We create customised escrow solutions for any situation, including good-faith deposits for mergers and acquisitions, subscription deposits for initial public offerings, and collection of split fees from joint ventures. Escrow arrangements are non-credit facilities with no capital costs, low fees and unlimited capacity, making them an attractive alternative to credit-based risk solutions such as standby letters of credit.