Monthly Archives: September 2017

FCA speaks on asset management regulation

Meghan Butler has spoken on how FCA is clarifying its supervisory approach to asset managers. She looked at FCA’s mission and its recognition of the importance of the asset management industry. She spoke of the findings of the asset management review and said FCA is still working through responses. In the meantime, the CMA has […]

FCA publishes streamlined advice guidance

FCA has published feedback on its consultation on guidance on streamlined advice and the fact find process. The guidance stems from two of the FAMR recommendations – and includes materials from existing guidance on adviser charging, complaints and redress, professional standards, appropriateness and discretionary investment management. FCA has also consulted on other FAMR related matters, […]

ESMA and NCAs agree waiver and position limit plans

ESMA and the national regulators in EU member states have updated their work plan for the opinions MiFID 2 requires on pre-trade transparency waivers and position limits. Around 700 of the former and 110 of the latter opinions need to be issued, so there is a plan to ensure they can be implemented pending the […]

PSD2 and Open Banking – bringing opportunities for start-ups

In an Insight article published on 28 September 2017, the FCA explores the opportunities that the Payment Services Directive 2 (PSD2) and Open Banking may bring for start-ups. PSD2 is changing the rules for the banking industry. From January 2018, UK banks will have to provide details of customer transactions to any authorised organisation that a customer approves […]

European Commission adopts IDD delegated regulations

The European Commission has adopted the following two delegated regulations in relation to IDD: conduct of business rules for the distribution of insurance-based investment products; and product oversight and governance requirements  for insurance undertakings and insurance distributors. The next step will be for the Council of the EU and the European Parliament to consider the […]

EU-US agreement on insurance and reinsurance

The European Commission has published a statement and a factsheet detailing the agreement reached between the EU and the US on prudential insurance and reinsurance measures. The agreement addresses three areas of prudential insurance oversight: reinsurance; group supervision; and the exchange of insurance information between supervisors. US and EU insurers operating in the other’s markets will […]

Bank of England expects 130 licence applications before Brexit

Comments made by Sam Woods, Chief Executive Officer of the Prudential Regulation Authority (PRA) were reported in an article published by Reuters, in which he stated that the Bank of England expects at least 130 financial firms from across Europe to apply for licences to continue operating in the UK after Brexit. He also commented that […]

FCA publishes IDD papers

FCA has published its policy statement on its first consultation on IDD implementation, including near final rules, and has also published its third consultation with further proposals. The IDD must be implemented by 23 February 2018. The near final rules cover changes to reflect: application of the IDD: FCA has clarified how the rules apply […]


A revised draft of the Business Contract Terms (Assignment of Receivables) Regulations 2017 has been laid before Parliament. The regulations provide that, save in respect of certain listed contracts, contractual terms prohibiting or restricting the assignment of a receivable or its enforcement by an assignee shall have no effect. The aim of the regulations is to remove barriers […]

FPC updates on stability

FPC has reviewed developments since its last meeting on 21 June and assess the outlook for UK financial stability. Its conclusion was that ‘overall risks to UK financial stability from the domestic environment are broadly unchanged at a standard level’, though risks of greater vulnerabilities may loom on the horizon. The headline statements were as follows: internationally, market […]

Law Commission publishes draft Goods Mortgages Bill

Following a 2016 report in which the Law Commission concluded that the Bills of Sale Acts should be repealed and replaced with legislation less burdensome to lenders and more protective of borrowers,  and its consultation over the summer on draft clauses for new legislation, the draft Goods Mortgages Bill has now been published. Currently governed […]

Failure to prevent facilitation of tax evasion

The new corporate offence under the Criminal Finances Act trips off the tongue!  It takes effect from 30 September, and “relevant bodies” must have considered their exposure to it and put in place reasonable procedures to guard against committing it.  We have written an article on the offence and the expectations of HMRC.

ESAs publish wire transfer guidelines for PSPs

The Joint Committee of the ESAs has published guidelines  under the revised Wire Transfer Regulation which was part of the MLD4 package, and that requires payment service providers to establish specific information about the payer and payee in electronic transactions, to combat terrorist financing and money laundering. In an effort to harmonise regulatory expectations across the EU, the guidelines ‘set […]

ESAs report on risks and vulnerabilities in the EU financial system

On 21 September 2017, the Joint Committee of the European Supervisory Authorities, published its September 2017 report on risks and vulnerabilities in the EU financial system, identifying Brexit and FinTech as two of the main risks to the EU financial system. Brexit: The UK’s decision to withdraw from the EU and the uncertainties around the […]

PSR updates on payment scam work

PSR published its initial findings following its investigation into authorised push payment scams at the end of 2016. It plans to publish a progress report in November, with its thoughts on the next steps.

FCA and HK Insurance Authority sign MoU

FCA has entered into a co-operation agreement with the Hong Kong Insurance Authority to enable the two regulators to collaborate better to support Fintech innovation. FCA already has in place similar agreements with the Hong Kong Monetary Authority and Securities and Futures Commission.

FCA looks at ageing population

FCA has published an Occasional Paper looking at the ageing population and financial services. FCA’s research has found there is a risk that the financial services needs of older people are not being fully met, and thinks there is potential for firms to do more to help them. It has identified several issues which will […]

FSCS launches “FSCS protected” badge

FSCS has announced a new agreement with banks and building societies, supported by industry associations, that will lead to institutions using the “FSCS protected” badge consistently across website, mobile banking apps and customer information sheets.  The banks and building societies have 18 months to make necessary changes.

FCA speaks on investigations and meeting MiFID 2 deadlines

Mark Steward has spoken on the increase in FCA investigations into market conduct over the past year. He said the 75% increase results from: more investigations into capital market disclosure issues the extension of scope of the reporting regime which MAR has brought – including a 77% increase in reports because of the MAR requirements […]

FCA speaks on SMR extension

Jonathan Davidson has spoken on culture and conduct in the context of FCA’s proposals to extend the SMR. Key points of his speech included: that business models often create commercial incentives for behaviours that lead to poor consumer outcomes, and FCA tries to understand how business models evolve to anticipate risks so it can use […]

EU plans CMU reforms

The Commission has proposed a package of reforms to further develop the CMU. The package comprises: EU-wide supervisory priorities set by the ESAs, which will also take a greater role in supervising the work of national regulators – in particular in checking how they allow market participants to outsource functions to third countries direct capital […]

fca publishes psd2 policy statement and final approach document

The FCA has today published its long awaited policy statement and approach document on the implementation of PSD2. The Policy Statement confirms changes to the Handbook and Approach Document guidance, and new non-Handbook directions for excluded firms, to reflect PSD2 and the PSRs 2017. This follows the two consultations the FCA issued in April (CP17/11) and July (CP17/22). FCA has made some […]

OFSI publishes quick guide to sanctions

OFSI has published a quick guide to UK business’ obligations under financial sanctions requirements. The material is not new, but repackages some existing guidance on: complete general guidance – including guidance on licences and queries specific to certain industry sectors monetary policies and the assessment process and the quick guide

Lords publishes Brexit FS evidence

The House of Lords Select Committee on the EU has published the uncorrected oral evidence of its heading on financial services supervision after Brexit. The hearing looked at the differences between international standards and EU standards, noting that international standards focus on prudential issues, leaving conduct and investor protection measures more to national regulators. But […]

FCA warns over MiFID 2 deadlines

FCA is pleased that it has received and determined several applications under MiFID 2 already. However, it is also concerned that it has notified many applicants that their applications are incomplete, and that there are certain sectors of the market, in particular proprietary traders using DEA who may need to apply for authorisation but have […]

Treasury Committee letter to Chancellor on effect of Brexit on insurance contracts

The Treasury Committee has published a letter written to the Chancellor of the Exchequer highlighting the problem with insurance contracts sold under passporting arrangements with a duration beyond 29 March 2019. The Chair of the Treasury Committee explains that without further action, insurers will lose the right to service these contracts and there may be insufficient time to […]

FCA responds on leaked RBS report

FCA has responded to Nicky Morgan’s letter about the leaking of a s166 report on RBS’ treatment of customers in its global restructuring group. Andrew Bailey has reiterated that FCA does not think it is in the public interest to publish the full report, and that it plans to publish a detailed summary. Nicky Morgan […]

CMA starts investment consultants market investigation

CMA has announced an investigation into the supply and acquisition of investment consultancy and fiduciary management services following a referral by FCA.  FCA has decided to reject the undertakings in lieu offered to its by the three largest investment consultants,  as it believes the market will benefit from an in-depth review. There were also concerns from […]

HFSB changes name

The Hedge Funds Standards Board has changed its name to the Standards Board for Alternative Investments, to reflect the evolution of the alternative investment industry.

ESMA updates MiFID 2 FAQs

ESMA has updated its FAQs on MiFID 2 and MiFIR market structures.  The updates relate to access to CCPs and trading venues and address timings of notifications and applications for exemptions by trading venues.      

FCA makes new rules

FCA’s latest Handbook Notice confirms it has made rules amending: TC to update the qualification table COBS and MCOB in respect of the smarter communications initiative, in particular to address the risks of over-disclosure COBS to enable governance bodies of relevant pension schemes to get information to allow them to assess transaction costs the Listing […]

Update from the Bank of England and The Payment Systems Regulator on new payment systems operator

In a joint press release issued today, the Bank of England (BoE) and The Payment Systems Regulator (PSR) announced that a New Payment Systems Operator (NPSO) had been created by the Payment System Operator Delivery Group (PSODG) who were charged with this task. The creation of the NPSO forms part of the PSR and BoE’s plan for consolidating […]

Insurance Europe calls for ‘grandfathering’ of existing insurance contracts post-Brexit

Insurance Europe has published a position paper calling for the ability of  (re)insurers’ to service existing contracts issued on the basis of passporting before Brexit to continue to run post-Brexit. IE recommends ‘grandfathering’ as the best solution. It is concerned that the ability of EU and UK citizens to exercise rights under insurance contracts is dependent on a (re)insurer’s […]

FCA unhappy with consumer credit complaints handling – asks firms to take action

In a Dear CEO Letter, the FCA explains that it recently undertook a review of how consumer credit firms approach and deal with customer complaints. FCA reviewed data, final response letters and website information on complaints from a range of consumer credit firms. FCA found examples of good practice to the benefit of consumers but also found material non-compliance […]

FCA warns on risks of ‘ICOs’

The FCA has today made a statement on Initial Coin Offerings or ‘ICOs’. The FCA has said that ICOs, which can vary widely in design, are ‘very high-risk, speculative investments.’ They went further to say that ‘whether an ICO falls within the FCA’s regulatory boundaries or not can only be decided case by case.’ The […]

Lloyd’s sets out CFA expectations

Lloyd’s has published a market bulletin on the Criminal Finances Act, focussing on its expectations of managing and members’ agents – in particular the need for senior management appreciation of the need for a focussed risk assessment and implementation procedure to address the risks of the failure to prevent facilitation of tax evasion offences.

Government makes CFA guidance

The Facilitation of Tax Evasion Offences (Guidance about Prevention) Regulations 2017 were laid before Parliament on 6 September and take effect on 30 September alongside the relevant parts of the Criminal Finances Act 2017. The Chancellor has adopted the required guidance on procedures that “relevant bodies” can put in place as a defence to an […]

OFSI updates frozen assets reporting forms

OFSI has published an updated webpage with a new template for the annual frozen asset review and reporting form.

ESMA updates MAR FAQs

ESMA has updated its FAQs on MAR. The additions clarify: the scope of firms subject to the requirement to detect and support suspicious orders and transactions the scope of financial instruments subject to the market sounding regime and who is subject to the insider list requirements.

AFME confirms MiFID 2 share trading obligation views

AFME has published a note setting out its views as to why the share trading obligation under MiFID 2 applies to a MiFID investment firm only when it is the final entity in the chain of execution. It says a firm that places or transmits an order to another firm, regardless of whether that other […]

ECB and BOJ publish joint research paper on Payment systems: Liquidity saving mechanisms in a distributed ledger environment

In December 2016, the Bank of Japan (BOJ) and the European Central Bank (ECB) launched their joint research project entitled “Stella”, which studies the possible use of Distributed Ledger Technology (DLT) for financial market infrastructures. Today, they published their findings. In the first step of their cooperation, the BOJ and the ECB conducted in-depth experiments […]

Article on cyber insurance underwriting risk

We have written an article published in Cyber Security Practitioner on PRA’s July 2017 Supervisory Statement on cyber insurance underwriting risk. The full article is available to subscribers.

AFME calls for Brexit transition clarity

AFME has called for early clarity on the Brexit transition. It says that while it is critical that transition arrangements are agreed soon, it agrees with the European Commission that they must be clearly defined, limited in time and subject to effective enforcement mechanisms. It says there must be recognition that businesses will need more […]

SFO speaks on DPAs

Alun Milford has spoken on SFO’s use of deferred prosecution agreements for dealing with “certain co-operative and reformed corporate offenders”. He noted that SFO has now secured 4 DPAs, of which 3 have been published. He drew a number of conclusions from the experience to date: that a DPA is not a rubber stamping exercise […]

Hong Kong Securities and Futures Commission makes statement on initial coin offerings

Much like the recent investigative report from the SEC in the USA in relation to the DAO token issuance, in which it was determined that a token sale amounted to the issuance of securities, this statement from the SFC serves to explain that, depending on the facts and circumstances of an ICO, digital tokens that are […]

FOS updates complaints data

FOS has published individual complaints data for H1 2017, relating to businesses in relation to which FOS both received and settled at least 30 cases during the period. FOS says these firms comprise around 95% of the total cases it handled. The highest levels of complaint related almost entirely to PPI claims, with the only other significant […]

FCA consults on miscellaneous changes

FCA’s latest Quarterly Consultation Paper covers: amendments to FEES in respect of fees when firms apply for a VOP for provision of payment initiation and account services. FCA needs to charge fees as it has realised it will need to apply more resource to these applications than it does to standard VOPs. DEPP and EG in respect […]

Up next from FCA

FCA’s latest Policy Development Update promises several publications over the coming quarter: during September, papers will include finalised guidance on FAMR implementation and a consultation on insurers’ fees and levies, as well as a policy statement on parts of FCA’s consultation on IDD implementation and a third CP. Feedback and policy statements on the second […]