One of the most fundamental ways in which Brexit is likely to affect many businesses, is the impact on immigration law. This is particularly the case for the financial services and insurance sectors, which have long drawn on talent from across the world. Womble Bond Dickinson (UK) LLP is putting on a series of seminars […]
We are delighted that Jonny Williams has joined the financial services regulatory team at Womble Bond Dickinson UK. More information on Jonny and his appointment can be found here.
FCA has published its final notices banning Stewart Ford and Mark Owen from performing any function in relation to any regulated activity and fining them £76 million and £3,240,787 respectively. Mr Ford held the CF1, 3 and for some time 8 positions in respect of Keydata Investment Services Limited Mr Owen held the CF1, CF16 […]
The FCA has launched a new portal to enable mutual societies complete tasks and submit information to the FCA that was previously done online or by post, such as the submission of annual rules and accounts and applications for rule amendments. Mutuals societies can start to register as users of this portal; the FCA will […]
The NCA has reported a rise in SARs from the private sector in the past year. It reports nearly 464,000 SARs received and processed in the year covered by its report. However, Transparency International says this should not mask the failings in the system. TI is critical of the scarce resources and out of date system […]
HMRC has updated its website in respect of money laundering supervision. The updates include the addition of webinars on firms’ obligations and how HMRC applies its supervisory duties.
JMLSG has updated its guidance to take account of changes to the MLR 2017 that came into force on 10 January. The changes ban firms from setting up anonymous accounts and passbooks or providing anonymous safe-deposit boxes, and direct that CDD take place on all anonymous accounts, passbooks and safe-deposit boxes in existence on that date, […]
The first meeting of the Government’s task force on economic crime has been chaired by the Home Secretary and the Chancellor. The Government plans that the Economic Crime Strategy Board will meet twice a year and will include senior representatives from Barclays, Lloyds and Santander as well as from UK Finance, the NCA, SRA, Accountants […]
The European Commission has opened a consultation to invite views from a range of stakeholders on the functioning of the Consumer Credit Directive (CCD). The purpose of the evaluation is to consider whether the CCD is still fit for purpose given market developments in the ten years since its adoption in 2008. Responses are invited […]
In October, the Treasury Committee reported on SME finance, making several recommendations including setting out its views on the availability of FOS and the Tribunal for SME disputes, and the suggestion that commercial lending be regulated to protect SMEs. The Government and FCA have now responded to the report. The Government has refused to bring […]
FCA has published its “Sector Views” setting out its observations from monitoring its 7 selected sectors of: retail banking retail lending general insurance and protection pensions and retirement income retail investments investment management and wholesale financial markets It produces this review to inform its overall approach and ultimately its business plan. The studies identify where […]
The European Commission has published a report showing how the AIFMD has significantly contributed to creating an internal market for AIFs. It says most of its provisions have achieved their intended objectives, although there are some areas that require further analysis. The Commission is due to present a report on the functioning of the legislation […]
The Treasury Committee has welcomed FCA’s new commitment to consulting on rule changes which will allow the estimated 120,000 “mortgage prisoners” who are with unregulated firms and 20,000 with firms that are inactive, to switch to active lenders. FCA has already acted to help the lesser number of mortgage prisoners who were with active firms. The […]
UK Finance has applied on behalf of the UK to stay in SEPA. SEPA is operated by the EPC outside the EU institutional framework. UK Finance says the SEPA community would support it staying, and its own members want to do so. The final decision will be made on 7 March, but UK Finance anticipate […]
PRA is proposing changes to its Supervisory Statement on credit risk mitigation, to clarify how financial collateral is eligible as funded credit protection under the CRR. The CRR sets criteria for recognising collateral as eligible for CRM, which include that “the credit quality of the obligor and the value of the [financial] collateral shall not […]
The FCA has published a ‘Dear CEO’ letter in which it provides clarity about the communication and approval of financial promotions by regulated and unregulated businesses. The FCA has published the letter after it has recently become aware that firms have been issuing financial promotions which suggest or imply that all the activities they undertake are […]
ESMA and EBA have published papers on ICOs and crypto-assets. The ESMA paper clarifies which crypto-assets currently qualify as financial instruments and provides its views on gaps and risks. The paper identifies several of these: where assets do not fall within the scope of MiFID financial instruments, there are substantial investor risks. ESMA says that […]
The EU Council has confirmed its position on the compromise proposals on a package of changes to the CRR/CRD4 , comprising a Regulation and a Directive, to allow prudential and supervisory requirements to be proportionate to the risk and business profile of regulated firms while ensuring financial stability. The new measures would divide investment firms into: […]
At the end of last year, the the Treasury published draft regulations making provision for contractual certainty for firms currently passporting into the UK in the event of a ‘hard’ Brexit. Following this, the FCA has published CP19/02 on Brexit and contractual continuity. This consultation paper is aimed at such incoming firms. It consults on […]
The ESAs have published a joint report on regulatory sandboxes and innovation hubs. The report shows that 24 EEA Member States have developed hubs but only 5 have regulatory sandboxes. As a result of the study the ESAs have recommended some statements of best practice for national authorities to follow in designing and operating their […]
FCA has opened the notification window for passporting-in firms. Firms will need to have notified FCA of their intention to seek full UK authorisation to carry on services in the UK before exit day in the event of a hard Brexit. FCA has opened the window from 7 January to 28 March, Its website includes a guide […]
The Single Financial Guidance Body (SFGB) was launched on 3 January 2019. It brings together three existing providers of financial guidance – the Money Advice Service, the Pensions Advisory Service and Pension Wise – to form a “one-stop shop”. The SFGB’s core functions will be: pensions guidance on workplace and personal pensions money guidance to […]
FCA’s latest Policy Development Update highlights a number of publications due before the end of Q1 2019: a policy statement on general standards and communication rules for payment services and emoney providers; consultation and discussion on the investment platforms market study remedies; policy statement on 2019/20 fees and levies; consultation on recovering the costs of […]
ESMA has updated its FAQs on MiFID 2 and MiFIR in respect of: transparency; and commodity derivatives. The updated questions cover, among other things, publication of request for market data transactions and the application of the “price multiplier” field in electricity contract reporting.
The Commission Implementing Regulation on the equivalence of the Swiss regulatory framework for stock exchanges for the purposes of MiFID 2 has been published in the OJEU and applies from 1 January 2019. The SIX Swiss Exchange AG and BX Swiss AG are considered equivalent to regulated markets.
The Extraterritorial US Legislation (Sanctions against Cuba, Iran and Libya) Protection of Trading Interests)(Amendment) Order 2018 will take effect on 1 February 2019. It updates a 1996 order to reflect updates to the EU Blocking Regulation – which makes it an offence for EU companies and individuals to comply with US sanctions imposed on Cuba, Iran […]
In December 2018, the FCA confirmed that as part of its take over of the regulation of CMCs from April 2019, it would require CMCs to register for temporary permission in order to continue to operate from April, and pending submission and approval by the FCA of a ‘full’ application to continue to do business. […]
EIOPA has published an Opinion on the supervision of cross-border non-life insurance where the risk is of a long term nature. In the Opinion, EIOPA notes that this type of insurance is often more uncertain than the majority of non-life business, requiring both knowledge of the local market and actuarial skills for the calculation of […]
The UK and the US signed the Bilateral Agreement between the United States and the United Kingdom on Prudential Measures regarding Insurance and Reinsurance on 18 December, although the announcement was made today by way of a joint statement from HM Treasury, US Treasury and Office of the US Trade Representative on Signing the UK-US […]
FCA has published its final framework setting out how it will measure the impact of its past interventions.
The FCA has published an evaluation paper on reducing barriers to entry into the UK banking sector. In its paper, the FCA evaluates the impact that the 2013 reforms to the authorisations process and a shift in approach to the prudential regulation of banking start-ups, has had on firms. Key findings from the evaluation include: there […]
ESMA is to renew the current restrictions on the marketing, distribution or sale of CFDs to retail clients for a further three months from February 2019.
BoE has made a statement on the equivalence of the future UK legal and supervisory framework for CCPs and CSDs, following a decision by the European Commission to make implementing acts that will allow UK CCPs and CSDs to be recognised by ESMA. The measures would take effect from 30 March 2019 in the event of a […]
As part of its preparation for onshoring EU legislation, the PRA has published CP32/18. This consultation paper contains two consultations: the first sets out the PRA’s proposals regarding the PRA Rulebook and the Binding Technical Standards (BTS) that are to come within the PRA’s remit; the second relates to BTS that will come within the […]
Following complaints by banks that AML rules are not effectively and consistently supervised, the Council has agreed to give EBA greater powers over supervision, including allowing it to perform risk assessments on competent authorities and addressing decisions directly to individual banks as a last resort. The proposals must now be agreed with the EP.
In a speech by Christopher Woolard, FCA has called on firms to increase their efforts to integrate diversity and inclusion principles in their business frameworks. While things are moving in the right direction, Mr Woolard said much work is still to be done. He particularly noted that the percentage of woman in senior management below […]
FCA is consulting on how it proposes to make technical standards which are substantially the same as the PSD2 SCA RTS to ensure strong customer authentication and common and secure open standards of communication post-Brexit. FCA comments that some of the SCA-RTS take effect from 14 March 2019 and others not until 14 September. In […]
FCA has fined Santander £32,817,000 for failing effectively to process the accounts and investments of deceased customers. FCA found the bank did not transfer funds totally over £183m to customers when it should have done and did not disclose problems in its probate and bereavement process to FCA once it became aware of them. The […]
In September 2018, the FCA consulted on new or amended rules, directions and guidance to implement the Regulatory Technical Standards for strong customer authentication and common and secure open standards of communication; new fraud reporting requirements; and draft EBA exemption guidelines. The FCA has now published its policy statement, setting out the revised Payment Services and […]
The FCA has today published finalised guidance (FG18/7) setting out what it believes firms should consider under the Consumer Rights Act 2015 when varying a term in their consumer contracts. The guidance includes a list of non-exhaustive factors for determining whether or not a variation term is fair. For example: Has the firm included the […]
After investigating a “super-complaint” raised by Citizens Advice that companies were penalising existing customers by charging them higher prices than new customers, the CMA has today published its 8 recommendations to help resolve this issue in 5 markets. “Loyalty penalty” refers to longstanding customers paying a lot more than new customers for the same services. […]
The BoE and the PRA have published consultation papers on resolvability and resolution assessments for certain firms. PRA CP31/18 sets out proposed rules that would require relevant firms to report to the PRA on their assessment of their preparations for resolution, and publicly disclose summaries of those reports. The BoE consultation paper includes proposals on […]
The EBA has issued a press release that urges firms with customers that may be affected by Brexit to be more proactive in communicating with their customers about how they may be affected. In particular customers should be told about any actions that firms have had to take as part of contingency planning that could […]
Earlier this year, the FCA published CP18/12, which proposed measures to reduce consumer harm and strengthen protections for customers of home-collected credit, catalogue credit and store cards. Following this, the FCA has published CP18/43, which: responds to feedback received to this earlier consultation paper and sets out final rules and guidance; includes finalised guidance for registered […]
As an early Christmas present, the FCA has published its Final Report into retail banking models. The review into this sector was launched in April 2017, and the FCA published an interim Progress Report in June 2018. The FCA’s next steps following the review will involve an on-going monitoring of retail banking business models, and […]
As part of its ongoing work to tackle high cost credit, the FCA has announced proposals to restrict the charges banks are able to impose for overdrafts. The FCA is proposing a package of measures that include stopping firms from charging higher fees for unannounced overdrafts, controlling overdraft charges, and requiring firms to work more […]
Following a consultation earlier this year, the FCA has published a policy statement setting out the new rules and fees that will apply to claims management companies (CMCs) from April 2019. From 1 April 2019, the FCA will become the regulator of CMCs that are established or serve clients in England, Wales and Scotland. FOS will […]
Treasury has published a draft statutory instrument setting out the Financial Services Contracts Regime (FSCR) which will provide run-off mechanisms to the various temporary regimes the government and regulators are preparing to put in place for Brexit. The regime will cover firms that currently passport into the UK under FSMA, the PSRs or the EMRs, and […]
The latest edition of Market Watch outlines FCA’s views on industry implementation of MAR. FCA stresses the importance of industry participants properly calibrating their risk assessments to the markets and asset classes they operate in and showing it is responsive to changes. It notes the importance of strong judgment in market abuse compliance and emphasises […]
The FCA has now published final rules confirming the expansion of the jurisdiction of the FOS to include certain SME customers. The new rules will mean that from 1 April 2019, the FOS will be able to hear complaints from SMEs who meet two of the three following criteria – fewer than 50 employees; annual […]
The FOS has published a consultation on its plans and budget for 2019/2020. It notes that from April 2019, its jurisdiction will be expanded by the addition of two significant areas of work: complaints made by SME customers of financial services, and complaints made by customers of claims management services. The consultation questions include inviting […]
The Financial Reporting Council has published the final version of new Corporate Governance Principles for large private companies. We have published an article that summarises and discusses these Principles.
The Home Office has updated on the first year’s progress against the UK’s anti–corruption strategy. The update concludes that the commitments made have largely been met, and that the UK is on track to deliver its remaining commitments. including those due in 2019, notwithstanding Brexit. The report highlights a number of points of interest to […]
FCA has finally issued its final notice banning Angela Burns from acting as a NED and has fined her £20,000. Ms Burns acted as NED for two mutual societies and was chair of their investment committees. She provided advice on appointing Vanguard Asset Management Limited as investment manager, and the societies believed this advice was […]
FCA has added a page to its website updating firms on what they could and should be doing to prepare for Brexit. The page is for use by UK and EEA firms and takes them through each various practicality they should consider.
We have written an article for Financial Regulation International on financial crime prevention developments in 2018.
PRA has published the Q3 2018 figures for skilled persons reports commissioned. There have been 3 on controls and risk management frameworks and one in the prudential insurance lot.
EIOPA has published its report on its evaluation of the structure of insurance intermediaries markets in Europe in accordance with IDD requirements. The report notes a very wide diversity of local distribution channels and differences between nationally adopted definitions. It also found divergence in registration and reporting requirements. Generally, the lack of homogeneity makes it […]
PRA has updated its Policy Statement relating to the Systemic Risk Buffer. The update follows consultation in response to which it received no comments.
FCA has now finalised its guidance on insider dealing and market manipulation within the Financial Crime Guide. It received 8 responses to its consultation, generally positive. However, some respondents raised concerns about: mandating a duty to prevent these crimes; the risk of firms tipping off by taking some of the actions the guidance proposed; where […]
PRA and FCA are consulting on new reporting requirements for mortgage lenders and home finance administrators. Both regulators think there are areas in which they need data from firms additional to that which is currently being reported. The changes will affect the MLAR and PSD returns. Key proposals include that: mortgage administrators should submit PSD […]
FCA has published the latest figures on engagement of consumers with its PPI helpline.
The US Department of the Treasury and Office of the US Trade Representative have confirmed their intention to sign a bilateral agreement on prudential measures on insurance and reinsurance which is consistent with the current US/EU agreement. The intention is to cater for ongoing relationships post-Brexit.
The CMA has announced a range of reforms to the investment consultancy and fiduciary management sector after finding competition problems. This follows an extensive market investigation into the sector which started last year, at the request of the Financial Conduct Authority (FCA). The CMA’s final report sets out a number of changes to deal with its […]
The Cost Transparency Initiative (CTI) has been established to deliver templates to help institutional investors to access and assess information on costs. The CTI will run a pilot to test the new cost transparency templates and supporting technical and communications materials until January 2019. Following the pilot, it will roll out the templates to the asset management […]
The EBA has published its Opinion on how eIDAS certificates and be used under the SCA and CSC RTS under PSD2. The Opinion: clarifies that it is the ASPSPs that should choose whether a Qualified certificate for electronic seals (QSealC) or a qualified certificate for web authentication (QWAC) should be used for identification purposes; suggests […]
A Court has found in favour of the lender in a case brought by a couple who entered into a 5 year interest only loan through a broker, which they met repayments on but were ultimately unable to repay the capital. The claimants said that the lender, Godiva, should have realised that a claim on the […]
BEIS has published its response to its consultation on the reform of Limited Partnership law. It has confirmed new measures, applicable to all limited partnerships in the UK (and, for Scottish Limited Partnerships, in addition to the beneficial ownership reportingrequirements previously introduced), to: require anyone registering a Limited Partnership to show they are registered with an […]
FCA has updated its website to show the forms that now apply to insurers, who have become subject to the SMCR from 10 December.
FCA has published the results of its study of cyber-resilience and security in 20 asset management and wholesale banking firms. Its review comprised firms of varying size, scale, operating models and geography. The review comes with many caveats, but the key messages include: Boards and Management Committees still have limited familiarity with the specific cyber-risks […]
The Upper Tribunal has ruled on an application by Mohammad Prodhan, former CEO of Sonali Bank (UK). Mr Prodhan contended that FCA was time-barred from taking action against him. He also applied for a direction for his anonymity in proceedings of the Tribunal and the FCA. Mr Prodhan alleged that FCA had not issued him with a Warning […]
Companies House has announced it now carries on additional checks on certain applicants for registration, to guard against designated persons using economic resources such as companies in an attempt to get round sanctions restrictions. From 12 December, Companies House will check applications from UK companies, European Companies, LLPs and SLPs, to assess the name, address, […]
The Charity Commission has warned charities that operate in Syria or Turkey of the dangers of aid passing through the Bab Al-Hawa crossing. There have been reports that the crossing is under the control of Al Qa’ida which means that charities and their partners that use it could inadvertently be funding that organisation and thereby […]
FCA’s latest quarterly consultation proposes rules that: amend SUP 16 to address FCA’s concern that it does not always hold accurate “firm details” by requiring an annual accuracy check and removing the option some firms currently benefit from to update details other than using Connect; and add the Association of Accounting Technicians to the list of bodies […]
FATF has published the long-awaited mutual evaluation report on the UK’s measures to combat money laundering and terrorist financing. The report notes that, because of the exceptionally large funds flow through the UK financial sector and the risks that some of these have links to crime and terrorism, there is a strong understanding of the […]
FCA is consulting on permanent rules to restrict the marketing, distribution and sale of CFDs and CFD-like options to retail consumers. The proposals are similar to the ESMA temporary measures, but FCA wants also to cover closely substitutable products and are proposing some different leverage limits. FCA feels the action is necessary because of constant […]
The European Commission has launched a review of the Distance Marketing Directive (DMD) to assess whether it is relevant, effective, efficient, and in line with other EU legislation. The review follows an announcement by the Commission in its 2019 work programme, that it would carry out an evaluation of the DMD in line with the better regulation principles. […]
ESMA has published the advice it received from the Securities and Markets Stakeholder Group on amending the PRIIPs KID. The group fully supports the principle of the KID but is disappointed that there are proposals for change so soon after firms spend significant resource to implement the original requirements and also that the consultation period […]
The European Parliament and the Council of the European Union have reached a provisional political agreement on the banking package of reforms that will result in CRD V/ CRR II. Proposed measures include more risk-sensitive capital requirements, in particular in the areas of market risk, counterparty credit risk and for exposure to central counterparties, and […]
The FCA has published the outcome of its thematic review into the treatment of customers with long-term mortgage arrears. While in general it found that firms treated such customers appropriately, it did note areas for improvement and inconsistencies in management practices. The FCA recommends that firms that offer or administer mortgages should read the review, […]
FCA has published the key findings from its recent information gathering exercise on pension transfer advice. This year it has collected information from an additional 45 firms and visited 18 of them. It found less than half the advice given was suitable and FCA is very disappointed that firms are still failing to give suitable […]
BIS has published a report on range of practices relating to cyber resilience. The report focuses on four areas of cyber resilience: governance and culture risk measurement and assessment of preparedness (both in preventing and recovering/learning) communication and information sharing interconnections with third parties. Drawing on competent authorities responses, exchanges between international experts and input […]
The EBA has published final Guidelines on the exemption from the fall back mechanism requirement under the RTS on Secure Customer Authentication and Common and Secure Communications (Commission Delegated Regulation (EU) 2018/389) (SCA & CSC RTS). This exemption applies to account servicing payment service providers (ASPSP) who meet the four conditions sets out in the […]
The Competition and Markets Authority (CMA) is consulting on its proposed Annual Plan, which sets out its plans and priorities for 2019 to 2020. Subject to the outcome of the Brexit negotiations, the CMA plans to give greater priority to potential market studies and investigations as it considers future work. The themes which it proposes should carry […]
ESMA has added to its EMIR Regulation Q&A document. The updated question relates to Article 41 of EMIR, on margin requirements.
FCA has published a decision notice setting out its proposal to find Mohammad Prodhan, the former CEO of Sonali Bank (UK) Ltd £76,400 in relation to the bank’s AML systems and controls. Mr Prodhan was responsible for the establishment and maintenance of effective AML systems and controls and FCA considered that between 2012 and 2014 […]
MEPs in ECON have voted through the proposals for changes to the rules on cross-border investment fund distribution. As part of the vote, they stipulated that marketing communications should be clearly identified as such and should include a detailed note of risks, investors’ rights and redress mechanisms. On pre-marketing, ECON defined the key point as […]
The FCA has today published a new webpage on requirements in its Handbook that apply to firms distributing insurance. The FCA says that although it expects firms will have already adapted their processes to take account of the new rules, which came into effect on 1 October 2018, it was calling on them to continue […]
FMLC has noted a number of legal uncertainties in the various draft onshoring legislation relating to investment funds and their managers. In relation to the drafts for AIFMs and Collective Investment Schemes, FMLC has spotted issues with: references to other legislation – and conflict between pin-pointed dates on which terms take effect; the temporary recognition […]
ECB has published its expectations on financial market infrastructures in terms of cyber resilience oversight. Its expectations are based on CPMI/IOSCO guidance and is aimed at providing the FMIs with clear steps on how to operationalise and enhance the guidance as well as providing supervisors with a clear remit for engaging with FMIs and assessing […]
Treasury has made the Sanctions Review Procedure (EU Exit) Regulations 2018. The Regulations, made under SAMLA, come into force on 7 January 2019 and address the mechanics of requesting reviews, variations or revocations of designations made under the Act.
SFO announced that the first DPA, agreed with what is now ICBC Standard Bank plc for breach of s7 Bribery Act, has come to an end after the bank successfully complied with its terms. The DPA lasted for 3 years. Its terms included payment of compensation and disgorgement of profits as well as a fine, and […]
Directors should receive pension contributions in line with the rate given to the majority of the rest of the workforce, according to new Principles of Remuneration published by the Investment Association (IA). The IA has updated its executive pay guidelines in response to investor concerns that companies are not listening, or responding, to shareholders over […]
The Department of Work and Pensions (DWP) is consulting on proposals to create an industry-led system of multiple dashboards which will allow millions of people to access their pension facts and figures from most pension schemes in one place online. The government is proposing that the Single Financial Guidance Body (which will replace the Money […]
The FIN team was delighted to win two awards at the 2018 Compliance Register Platinum awards, including Best Consultancy/Law Firm – Regulatory Compliance. Thank you to those of you who nominated us and those who were there to share the evening with us.
The Treasury Committee has published the Bank of England’s analysis of the Withdrawal Agreement and Political Declaration. The lengthy document explains how the reduction in openness with reduce the UK economy’s productive capacity and generally its short-term rate of growth – and how a disorderly Brexit will exacerbate this. It also notes that the longer-term […]
BoE has published its latest Financial Stability Report together with the results of the 2018 Stress Tests. The Financial Stability Report found that the UK financial system has good resilience to a range of risks, including Brexit – banks could lend in a scenario more severe than the financial crisis and are prepared and strong […]