Legislative risk

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Legislative risk

The risk that new or changed legislation will have a large positive or negative effect on an investment.

Legislative Risk

The risk of loss due to a change in law in a particular jurisdiction. In general, legislative risk is the same is political risk, though the latter encompasses situations like coups and terrorism while legislative risk refers to changes in law according to due process. An (extreme) example of legislative risk is the possibility that the holder of a real estate investment trust will suffer a loss if the government passes a law that nationalizes all land in the country. More commonly, legislative risk deals with changes such as requirements to provide more benefits to employees or free trade agreements that make an industry less competitive against its foreign counterpart.
References in periodicals archive ?
The principal risks now included potential exposure to movements in commodity prices, legislative risks and the response of Sembcorp's customers on the Wilton site to the recession.
Among these factors are changes in overall economic conditions, changes in demand for our products, changes in the demand for, or price of, oil, risk of terrorism, war, geopolitical or other exogenous shocks to the airline sector, risks of increased competition, manufacturing and product development risks, loss of key customers, changes in government regulations, foreign and domestic political and legislative risks, risks associated with foreign operations and foreign currency exchange rates and controls, strikes,embargoes, weather-related risks and other risks and uncertainties.
Moreover, in the high-end vodka niche, Synergy should be better protected from legislative risks (stricter legislation aimed at increasing vodka prices to reduce consumption).
Gibson said looming legislative risks should be enough of an incentive to look for alternatives now.
For example, there are regulatory and legislative risks, professional, contractual, competitive and human resource/cultural risks, reputational, strategic, customer, operational, political, legal, financial, and technological risks.
Primary rating concerns facing CMS and Consumers relate to the execution of the large capital spending plan and recovery lag associated with sales weakness due to the still struggling Michigan economy, a gas rate case, and legislative risks associated with a competitive market structure.
Among these factors are changes in overall economic conditions, changes in demand for our products, changes in the demand for, or price of, oil and natural gas, risks of increased competition, technological, manufacturing and product development risks, loss of key customers, changes in government regulations, foreign and domestic political and legislative risks, the risks of war and international and domestic terrorism, risks associated with foreign operations and foreign currency exchange rates and controls; weather-related risks and other risks and uncertainties described in our publicly available filings with the SEC.
Primary rating concerns facing CMS and Consumers relate to the execution of the large capital spending plan and recovery lag associated with sales weakness due the still struggling Michigan economy, pending electric and gas rate cases, and legislative risks associated with a competitive market structure.
Another key concern for corporate management is the uncertainty posed by regulatory and legislative risks, which have deepened beyond healthcare to a wider range of areas.
Partially offsetting these positive rating factors are AIFC's product and geographic concentration--operating in just three states--which exposes the company to judicial, regulatory and legislative risks and weather-related events.
Furthermore, Highmark remains exposed to legislative risks due to the company's strong participation in government programs on both state and federal levels.