Analysis of Burford Capital's Statement on US Senate's Budget Reconciliation Bill

Burford Capital Issues Statement on US Budget Reconciliation Bill

On June 17, 2025, Burford Capital Limited, a premier global finance and asset management firm centered around the legal sector, released a critical statement regarding several proposed tax provisions relating to litigation financing. This statement comes amidst the tumultuous backdrop of the US Senate's ongoing budget reconciliation process, commonly referred to as "the One Big Beautiful Bill."

As the complexities of the budget unfold, it's become evident that the US Congress is entangled in a significant discussion over the nature of different versions of the bill. Following the House of Representatives' approval of a variant that exceeds 1,000 pages, the Senate, too, has provided its proposed tax-related provisions, which are equally substantial - wherein the specific tax guidelines pertaining to litigation finance comprise around 549 pages. Despite the Senate's efforts, these provisions await review for compliance with their own reconciliation procedures and have yet to face any voting session.

Notably, while the House bill does not mention litigation financing, the Senate's draft introduces a provision aiming to raise the statutory tax rate applicable to litigation finance transactions. However, Burford Capital has expressed concerns over the imprecise wording of this provision, which hampers the company's ability to determine its potential effects should the bill be enacted without further interpretation from the IRS.

The pronounced discrepancies between the House and Senate's bills imply that if the Senate's draft passes unchanged, extensive negotiations will be necessary to reconcile the two documents. This necessitated conference process stands as a significant legislative hurdle, as it not only requires compromises between both chambers but also mandates a subsequent vote in each to finalize a unified version of the bill. As the legal and financial landscapes merge within this legislative framework, uncertainty persists surrounding the final content of the bill.

Burford argues that litigation finance serves as a vital equalizer for enterprises, enabling access to capital essential for pursuing legitimate claims. The firm's position emphasizes that litigation financing empowers companies across all spectrums, facilitating growth, innovation, and job creation within communities rather than diverting limited resources to disputes.

Given the convoluted nature of ongoing discussions, Burford Capital remains optimistic yet cautious, urging Congress to preserve the favorable conditions that allow businesses to acquire essential litigation financing without elevated costs, which could stifle growth and innovation.

About Burford Capital

Burford Capital prides itself as a leader in legal finance and asset management. Its services span litigation finance, risk management, asset recovery, and a diverse range of legal finance and advisory roles. As a publicly traded entity listed on both the New York Stock Exchange and the London Stock Exchange, Burford collaborates with companies and legal firms globally through its expansive network of offices.

For more information, please visit Burford Capital's website.

This announcement should not be construed as a solicitation to sell or buy any securities of Burford or this information as an offering for any private fund managed by Burford. This statement contains forward-looking comments subject to uncertainties and factors that can lead to materially different outcomes than anticipated.

Given the unpredictable nature of legislative processes, stakeholders are advised not to overly rely on these projections and stay informed through Burford's ongoing communications.