Abstract
The Material Adverse Change/Effect doctrine (“MAC”) has become an important, yet chaotic legal concept. With its vague definition and multi-functional objectives on the one hand, and the potential of dramatic consequences arising from the instability of global financial systems, terrorism, Brexit, and, quite possibly, pandemic (COVID-19) outbreaks on the other hand, the significance of MAC has evolved. The article analyses uncertainty surrounding the MAC doctrine under English law by critically evaluating the MAC and investigating its future under English law both in Debt Finance and M&A following Delaware’s ground-breaking decision in Akorn v Fresenius, followed by Boston Scientific. The article argues for a growing ex-ante, ex-interim, and ex-post practical importance of MAC in the light of destabilising market events. It also argues that Delaware MAC principles are relevant as a reference point for resolving English MAC uncertainties, provided one considers the specifics of MAC’s interpretation in both jurisdictions and its unique attributes in M&A and in Debt Finance. The article further argues that there is no overarching model for the correct application of MAC, be it in Debt Finance or in M&A.
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