UBS’ proposed takeover of long-time arch rival Credit Suisse has received a green-light from US authorities.

The Federal Reserve Board of Governors has given the hastily constructed deal the go-ahead despite its unconventional nature. Both of the Swiss banks have significant operations in the US.

In order to get the approval, UBS has committed to give the Fed an implementation plan for the merger. The Fed’s board said in a statement that the plan must include stringent requirements, including liquidity standards.

While the deal is on track in respect to the US side, doubts remain closer to home. In rushing through an agreement over a fraught weekend, the companies may have violated Swiss law, according to some experts.

The issue of contention is reportedly that the Swiss government and financial regulator do not have the legal authority to sign off the deal in Switzerland on their own. There is apparently a basis in Swiss law for approval from the whole Swiss parliament to be required for such a transaction.

This will likely be put to the test in the courts over the coming months.

The takeover has also created a furious group of investors which look set to take legal action against the banks; namely, the holders of the AT1 convertible bonds which were wiped out as part of the deal.

The related court cases that are expected to follow have the potential to significantly delay or even scupper the deal.

Also see: Credit Suisse AT1 holders hire law firm to seek compensation