ASA has told HDR Global Trading to take down an ad and ensure in future that financial information was set out so as to be readily understood by the audience it was aimed at and that the risks of the relevant...
Category - Investments
Emma RadmoreFCA updates skilled persons statistics
FCA has released the figures for skilled persons reports it commissioned in Q1 2019/20. It commissioned 9 reports in total – of which 3 related to each of retail lending and wholesale financial markets, 2 to...
Feedback on EBA Single Rulebook published
The EBA has published the results of a review exercise it conducted to assess the utility of the Single Rulebook. As might be expected, overall feedback from the competent authorities and selected industry...
Roseyna JahangirUp next from FCA
The latest version of FCA’s Policy Development Update highlights: expected feedback on Investment Platforms Market Study Remedies by the end of the year; potential policy statement on general insurance value...
Treasury Committee calls for FCA powers on perimeter changes
The Treasury Committee has unanimously called for FCA to be given formal powers to recommend changes to the regulatory perimeter. It says the current informal system allows the grey area between regulated and non...
FRC fines KPMG and individual over CASS reports
The Financial Reporting Council has fined KPMG Audit plc £3.5m (including a 30% reduction for it admitting the misconduct) and one of its (now) partners £52,500, reprimanded them, and imposed a requirement on the firm...
Jonny WilliamsMarket Watch focuses on insider dealing risks
The latest edition of FCA’s Market Watch focuses on FCA’s concerns on access to inside information, following the conviction of a former compliance officer for sharing information. FCA noted that Fabiana...
Publication of AG Opinion on consequence of removing unfair terms in consumer contracts
The European Court of Justice has published the AG’s Opinion in a case concerning the effect of a declaration of unfair terms for the purposes of the Unfair Contract Terms Directive (in UK law as the Consumer...
EC sets out position statement on equivalence decisions
The EC has published a communication about equivalence decisions (the timing of which is no doubt entirely unrelated to the ascension of pro-Brexit Boris Johnson to the Prime Ministership of the UK). The communication...
FCA publishes SMCR final rules
FCA has at last published its final rules on extending the SMCR to solo-regulated firms, including CMCs. It has, in the main, implemented the changes it consulted on in its consultation on “optimising” the...
Tribunal refuses suspension application
Sussex Independent Financial Advisers Limited had applied to the Tribunal for a suspension of the FCA’s decision to vary its permission to remove all its permitted activities on the basis that the firm did not...
Audrey KohFCA updates on London Capital & Finance investigation
Dame Elizabeth Gloster has made an initial announcement on how she plans to conduct the investigation into the regulation of London Capital and Finance plc. An email address has been set up for any communications...
Regulators tweak exit arrangement rules
FCA has announced an extension to the directions made under its temporary transitional power which it introduced in February. The direction will now give firms until 31 December 2020 to make the necessary adjustments...
Commission adopts unfair terms guidance
The European Commission has adopted a guidance note on the Unfair Contract Terms Directive. The note covers: the objectives and scope of the directive; key terminology such as “supplier” and...
FCA writes Dear CEO letter on harm risks in wealth management
FCA has written to CEOs of wealth management and stockbroking firms setting out its view of the key risks of harm their firms pose to customers and markets. FCA has recently started its 2 year strategy plan on...
FCA fines Standard Life for non-advised sales failings
FCA has fined Standard Life Assurance Limited £30,792,500. The fine relates to non-advised sales of annuities, and sales practices over nearly 8 years. Although the sales were non-advised, FCA found that the firm...
FCA publishes feedback statement on fair pricing
In the context of ongoing work by both the FCA and CMA on fair pricing and loyalty penalties, the FCA has published a feedback statement setting out a framework for how it will evaluate the fairness of a given pricing...
JMLSG updates on Guidance
JMLSG has thanked all those who responded to its proposed changes on the chapters in Part II of its guidance addressing credit unions and brokerage services to funds. It has now put the finalised chapters to Treasury...
Call for evidence on impact of MiFID II disclosure requirements
ESMA has opened a call for evidence regarding the impact of MiFID II disclosure requirements in relation to inducements, and costs and charges. The responses will form part of ESMA’s assessment of the...
FCA discusses AI in financial services
In a recent speech, Christopher Woolard of the FCA considered three lenses through which the FCA views the issues relating to AI: what are new, and what are existing issues; how to ensure that AI creates value for...
MiFID II compliance function consultation published
ESMA is consulting on draft guidelines regarding the compliance function under MiFID. The proposals build on the existing 2012 guidelines by, among other aspects, addressing the changes MiFID II made to the compliance...
ESMA consults on harmonisation of performance fees under UCITS Directive
ESMA has published draft guidelines addressing the way in which performance fees can be charged to a UCITS and its investors. The areas covered by the draft guidelines include the circumstances in which a performance...
FCA invites feedback on Gabriel replacement
The FCA has announced that it is planning a replacement for Gabriel, its data collection system. It has therefore asked current Gabriel users to complete a feedback survey to provide views that can be considered in the...
ESMA warns CFD providers on undesirable practices
ESMA is still concerned about firms that market, distribute or sell CFDs to retail clients. It has now published a warning to them, saying it is particularly worried about: encouraging retail clients to ask to opt up to...
ESMA updates MiFID 2 FAQs
ESMA has updated its FAQs on MiFID 2 and MiFIR in respect of investor protection and intermediaries. There is a new question on how to classify financial instruments under RTS 27 for best execution purposes when ESMA...
ESA evaluates cross-border supervision of retail financial services
A report published by the Joint Committee of European Supervisory Authorities, ie the EBA, ESMA and EIOPA, has reviewed the current landscape of cross-border supervision, in particular in the light of the regulatory...
EBA reports on POG guidance implementation
EBA has reported on how industry has implemented its Product Oversight and Governance arrangements guidelines. It found a mix of good and bad practices. Some of its criticisms were that: often the manufacturer’s...
CMA launches digital advertising market study
The CMA has launched a study into online platforms and digital advertising. The study will focus on harm caused by consumers in connection with three areas of digital advertising: the extent online platforms (such as...
Alex LouchFCA considers ban on sale of crypto-derivatives to retail consumers
The FCA has published a consultation paper on prohibiting the sale of derivatives and exchange traded notes (ETNs) referencing certain types of cryptoassets to retail customers. The FCA considers such products to be ill...
Angie BamboulisFCA speaks on regulating innovation
Christopher Woolard has spoken on regulating financial innovation. He explained how valuable early engagement is, and how working with innovative firms helps FCA to get a good bird’s eye view of what it should...
UK financial regulators publish climate change Joint Declaration
The FCA, PRA, TPR and FRC have jointly issued a declaration reiterating their commitment to work on the enhancement of climate-related disclosures. The Joint Declaration also welcomes the UK’s Green Finance...
UK government launch Green Finance Strategy
HM Treasury and BEIS have launched a Green Finance Strategy to meet the government’s target of reducing emissions to net zero by 2050, to boost sustainable investment, and to help make the UK a ‘green...
ESMA leaves product intervention to Member States
ESMA has decided not to renew its prohibition on marketing, distribution or sale of binary options to retail clients, and the ban expired on 1 July. Its reasoning is that most Member States now impose their own...
FCA makes CFD limiting rules
FCA has confirmed the restrictions it is putting in place for firms that offer CFDs to retail customers. It is requiring all firms that offer CFDs and CFD-like options to retail consumers to: limit leverage –...
Treasury updates on mini-bond review
Treasury has written to Nicky Morgan updating on the progress of its review into the failure of London and Capital Finance and the government and FCA review of mini-bonds. Alongside the FCA review into the...
FCA summarises new rules
FCA’s latest Handbook Notice confirms the following rule changes: the changes to, mainly MIPRU, MCOB and SUP that took effect on 4 June in relation to crowdfunding platforms that offer home finance products, where...
EU Council adopts crowdfunding position
The Council of the EU has adopted a position it hopes will make it easier for crowdfunding platforms to provide services across the EU, by setting minimum requirements that the platforms must meet and harmonising...
New Prospectus Regulations take effect in July
Treasury has amended the current UK rules on Prospectuses to implement the EU Prospectus Regulation which repeated the 2003 Prospectus Directive. The Regulations designate FCA as the UK Competent Authority and make...
Barry StimpsonChancellor outlines financial services plans at Mansion House speech
The Rt Hon Philip Hammond MP spoke at Mansion House on 20 June, and outlined government’s plan to safeguard and expand the financial services industry, despite the uncertainties of Brexit and its likely impact on...
FCA publishes first perimeter report
FCA has published the first of what will be an annual report on its regulatory perimeter. Among other things, the report is designed to explain what challenges the perimeter is presenting and whether there might be a...
FCA consults on financial resources
FCA is consulting on the approach it takes to assessing adequate financial resources – and what it means by the term. The paper has been prompted by the levels of compensation FSCS has paid out relating to firms...
Up next from FCA
FCA’s latest Policy Development Update heralds a few interesting papers on the near horizon, including: a consultation in June on alternatives to high cost credit; perhaps, a policy statement on general insurance...
IOSCO publishes recommendations for sustainable finance in emerging markets
The Growth and Emerging Market Committee of IOSCO’s report is directed at securities regulators and makes 10 recommendations for emerging market jurisdictions to consider when issuing regulations or guidance for...
Treasury Committee announces inquiry into decarbonisation of the UK Economy and Green Finance
The Treasury Committee has announced an inquiry that will look at the respective roles of HMT, regulators and financial service firms in supporting the government’s climate change commitment. The terms of...
ESMA speaks on equivalence and cross-border regulation
Steven Maijoor has spoken to FESE about the challenges of cross-border regulation and supervision. He focused on market fragmentation and heralded the work of IOSCO, which will be discussed at this month’s G20...
FCA and Dutch Authority agree on closer partnership
The FCA and the Dutch Authority for the Financial Markets have agreed to work more closely together in order to protect and enhance the integrity of their financial systems. The regulators will share information to...
FCA Publish Final Rules on Loan-based and Investment-based Crowdfunding Platforms
On 4th June 2019, the FCA published its feedback to CP18/20 and its final rules on loan-based and investment-based crowdfunding platforms in Policy Statement PS19/14. The changes largely match the proposals within the...
Caroline StevensonFSB Report on Crypto-Asset Risks
The FSB has published a report on crypto-assets, which will be delivered to G20 Finance Ministers and Central Bank Governors ahead of their meeting in Fukuoka in June 2019. In particular the report notes: the work...
ESMA updates MiFID II and MiFIR Q&As
The ESMA has published new Q&As on the implementation of investor protection topics, which address best execution and information on costs and charges.
EC clarifies scope of PRIIPs regulation to bonds
Following a request for guidance in July 2018 on the treatment of bonds under the PRIIPs regulation, the EC has reiterated that the assessment of whether a particular bond is a PRIIP or not must be performed on a case...
FCA and ESMA statements on share trading obligations
ESMA has published a statement on the revised scope of the EU’s share trading obligation (STO) under a no-deal scenario, following their initial announcement on 19 March 2019. ESMA stated that although its prior...
FSB publishes LEI implementation review
Following the launch of its peer review of LEIs in August last year, the FSB has now published the outcome of this review. Overall, the review found that take up of LEIs was patchy, being most concentrated in...
IOSCO consults on Crypto-Asset Trading Platforms
The Board of the International Organisation of Securities Commissions has published a consultation report on Crypto-Asset Trading Platforms which trade crypto-assets that have been categorised as securities. The...
FCA extends temporary permissions deadline
FCA has confirmed the deadline for EEA firms to notify it of their intention to use the temporary permissions regime is now 30 October. FCA has updated its website with details of how the TPR applies, and its policy for...
London Capital & Finance investigation starts
Treasury has announced an investigation into the collapse of London Capital & Finance and FCA’s supervision of the firm. John Glen, Economic Secretary to the Treasury, said there is an urgent need to...
FCA successful in High Court case against unauthorised forex firm
Following an application by the FCA, the High Court recently ruled that Xcore Capital Limited, an unauthorised forex firm, and broker, Mr Jonathan Chitty had carried on an unauthorised investment scheme. Consumers were...
ECJ judgment means TUPE may apply on transfer of clients’ investments
In Dodič v Banka Koper and another C-194/18, the European Court of Justice (ECJ) had to decide whether the Acquired Rights Directive (ARD) applied where a stock market intermediary stopped providing services and gave...
Michelle ChanceOver £27 million lost to scams involving crypto and forex investments
The FCA and Action Fraud have reported that victims have lost over £27 million in total in 2018/2019 to crypto and forex investment scams. Action Fraud reports show that on average, victims were each scammed out of...
EU Council adopts updated rules for financial derivative products and clearing
The EU Council has adopted a new regulation, amending the European Market Infrastructure Regulation (648/2012), that will address the transparency issues, insufficient access to clearing and disproportionate complicated...
EU Council adopts legislative framework to reduce risks in banking system
The EU Council has adopted reforms to CRD IV and the BRRD, as approved by the European Parliament in April. The package includes: a leverage ratio requirement for all institutions and a leverage ratio buffer for all...
FCA helps investors in unregulated mini-bonds
FCA has published advice to investors who lost money investing in Secured Energy Bonds plc mini-bonds. The advice notes that, although the issuer was (and did not need to be) regulated, mini-bonds are themselves...
FCA calls for input on FAMR and RDR
FCA has called for feedback on its planned approach to reviewing the RDR and FAMR. The purpose of the review is to find out whether the two initiatives have succeeded in their objectives, focussing on what consumers...
FSCS sets next year’s levy
FSCS has set its 2019/2020 levy. It will be £532m, which is slightly more than its forecast, but still less than the 9 month levy for last year (had it been a 12 month levy). FSCS puts the increase down to an uplift in...
EBA supervisory colleges 2018 Report published
The EBA’s report sets out its findings on the monitoring of supervisory colleges in 2018. It noted in particular that AML and counter terrorism financing is increasingly on the agendas of the supervisory...
FSB updates on market issues
FSB, in its latest plenary meeting, discussed: current vulnerabilities in the global financial system; developing a surveillance network for potential vulnerabilities; areas where supervisory policies and practices...
FCA announce delay of publication of rules for CFD
Further to our article in December, the FCA have published a statement announcing that it is delaying publication of final rules for CFD products and CFD-like options. The FCA consulted on permanent rules to restrict...
Natasha BrownleeFCA confirms miscellaneous new rules
FCA’s latest Handbook Notice confirms the following rule changes: to COBS 22 in relation to introducing a ban on selling, marketing and distributing binary options to retail customers, which already took effect...
FCA publishes PFOF findings
FCA has published an update to its Market Watch item on payment for order flow. It has now carried out a review of 15 firms, to check how they monitor compliance with FCA requirements around conflicts, inducements and...
FCA publishes research agenda
One of the documents that accompanied FCA’s Business Plan is its Research Agenda. This sets out its intentions in respect of the themes that underpin the Business Plan. The document explains how FCA welcomes...
Wholesale brokers ignore Dear CEO letter at their peril
FCA has written a Dear CEO letter to wholesale brokers setting out its thoughts on the key harms the sector poses. The letter explains that MiFID 2 and MAR have significantly raised expectations on market participants...
CRD V, BRRD and SRMR packages approved by European Parliament
The European Parliament has approved the above series of legislative measures designed to enhance the resilience of banks and reduce risks in the banking system. The measures will next go to the European Council for...
FCA reminds firms about the approval of financial promotions
Following its ‘Dear CEO’ letter, published on 9 January 2019, the FCA has reminded firms involved in the approval of financial promotions for unauthorised persons of their obligations when doing so. The FCA...
ESAs publish PRIIPs KID FAQs
The ESAs have published further Q&As on the KID requirement for PRIIPs. The updates are on both general topics (in respect of calculating the minimum holding period for a product) and MOPs, in terms of the form and...
ESMA publishes appropriateness briefing
ESMA has updated its supervisory briefing on MiFID 2 appropriateness requirements and execution only. The briefing covers: working out when an appropriateness assessment is needed; getting information from clients; the...
ESMA happy with national product intervention measures
ESMA has issued positive opinions on product intervention measures taken by not only the FCA in relation to binary options, but also the Polish KNF and Dutch AFM (also in respect of binary options), and a further...
EU and Singapore adopt equivalence in derivatives trading venues
The European Commission and MAS have mutually recognised several trading venues as equivalent in terms of their respective trading obligations. The EU has recognised 3 approved exchanges and 2 market operators. MAS has...
FCA makes binary option banning rules
FCA has published its final position and Handbook Rules on permanent product intervention measures that will ban sale, marketing and distribution of binary options to retail consumers. ESMA has extended its temporary...
Treasury asks permission to back EU risks reduction package
HM Treasury has written to the House of Lords European Committee and the House of Commons European Scrutiny Committee to request clearance to vote in favour of amendments to the BRRD, CRD and CRR. The reform package is...
FCA and SEC sign updated Brexit MoUs
FCA and SEC have signed two MoUs to ensure minimal disruption when the UK leaves the EU. Andrew Bailey, FCA CEO met Jay Clayton, SEC Chairman to sign the MoUs. The first MoU updates the comprehensive supervisory...
FIN. TeamESMA updates funds and MAR FAQs
ESMA has updated its FAQs on: the application of the UCITS Directive to include clarification on benchmark disclosure obligations for UCITS both in the KIID and where funds name a target in their investment objectives...
FCA publishes final no-deal Brexit rules
Perhaps in anticipation of what would follow later in the day, FCA published its final instruments and guidance that would apply in the event of a no-deal, no-implementation period Brexit, on the morning of 29 March...
ESMA updates MiFID 2 FAQs
ESMA has updated its Q&As on MiFID 2 and MiFIR investor protection and intermediaries topics. There are several new questions, including on: reverse solicitation by third country firms the target market of CoCo-bond...
FCA fines GSI £34m for 10 years of poor transaction reporting
FCA has fined Goldman Sachs International £34.3m for failing to provide accurate and timely reporting from the date of implementation of MiFID (November 2007) to March 2017. The failings affected over 220 million...
ESMA updates Q&A on MiFID II AND MiFIR in relation to commodity derivatives topics
ESMA has updated its Q&As on MiFID II and MiFIR commodity derivatives topics. An new answer has been published on the ancillary activity test as it applies to third-country firms and subsidiaries, and the answer...
EIOPA to prepare guidelines on outsourcing to cloud service providers
As part of its response to the European Commission’s FinTech Action Plan, EIOPA has published a report setting out: a summary of the current NSA work on cloud computing, an analysis of the current EU (re)insurance...
AFME publishes no-deal selling restrictions
AFME has published suggested wording for selling restrictions for equity transactions to use in the event of a no-deal Brexit. It is designed for the most common scenarios and comprises an EEA public offer restriction...
ESMA issues FAQs under Prospectus Regulation
ESMA has published its first set of FAQs under the Prospectus Regulation. The questions look at: grandfathering of prospectuses approved under the 2003 Prospectus Directive applicability of guidance on the old Directive...
ESMA renews CFD and binary option restrictions
ESMA is renewing the restrictions on marketing, distribution or sale of CFDs to retail clients for a further 3 months from 1 May. Separately, it has also renewed the restrictions on binary options, so that these...
FCA clarifies MAR status on hard Brexit
FCA has updated the information on its website about the Market Abuse Regulation, to clarify that the Treasury’s intention is to convert MAR and the Short Selling Regulation into UK law on a hard Brexit. This...
FCA extends temporary permissions window
In light of the current short extension to Brexit, FCA has decided to extend the notification window for EEA firms to apply for temporary permissions. The window was due to close on 28 March, but will now close on 11...
FCA looks at life beyond Brexit
In a speech on Brexit delivered by Nausicaa Delfas, Executive Director of International, the FCA reminded firms that the deadline for notifications under the temporary permissions regime is 28 March 2019. Firms that...
FCA plans UK Benchmarks register
FCA is planning a new UK Benchmarks Register to replace the ESMA register post-Brexit for UK supervised users, for use by them and UK and third-country supervised benchmark administrators that want their benchmarks to...
Europe reaches political agreement on reforms to EU supervision
The European Parliament and Member States have reached agreement on core elements of the reform of European supervision of financial markets, including strengthening the supervisory framework in the area of anti-money...
ESMA AND FCA STATEMENT ON SHARE TRADING OBLIGATIONS
ESMA has published a statement in which it outlines its approach, in the event of a no-deal Brexit, to the application of the trading obligations for shares (STOs) under article 23 of MiFIR in the absence of an...
FCA imposes £27.6 million fine for transaction reporting failures
The FCA has fined UBS AG for transaction reporting failures during the period November 2007 to May 2017. The FCA reported that a total of 135.8 million errors in reporting were made during this period. It queried...
Treasury Committee asks for London Capital inquiry
The Treasury Committee has written to Treasury and FCA asking for an investigation into the events at London Capital and Finance. FCA had told the firm to withdraw its promotional materials for its mini-bonds in...
BIS reports on central bank digital currencies
The BIS Committee on Payments and Market Infrastructures and the Markets Committee have published a joint report central bank digital currencies (CBDC). The report sets out the findings of research conducted by the...
FCA publishes investment platforms market study
FCA has published the final report in its Investment Platforms Market Study. It has concluded that the market is working well for most consumers, but it is proposing changes that will make it less expensive and time...
FCA Update on Digital Regulatory Reporting
The FCA has updated its webpage on digital regulatory reporting (DRR) by publishing – a video which explains the concept of DRR and outlines the work carried out by the DRR pilot group; a report which sets out an...
BCBS Statement on crypto-assets
The Basel Committee on Banking Supervision has published a statement on crypto-assets. The Committee acknowledges that while the crypto-asset market remains small relative to that of the global financial system, and...