Category Investments

ESMA publishes texts supporting the Securitisation Regulation

As part of the implementation of the Securities Regulation, which begins to apply from 1 January 2019, ESMA has published: draft regulatory and implementing standards on the contents of applications to register with ESMA as a securitisation repository; Final Technical Advice on fees to be charged for registering and supervising securitisation repositories; further guidance to […]

ECB publishes capital and liquidity management final guides

The ECB has published non-binding guidance for banks on its expectations regarding internal capital liquidity adequacy assessment processes. The guides will be applied from 1 January 2019. These guides updated previous guidance from January 2016, and indicate an intensification of the ECB’s supervisory assessments and an increase in the role of ICAAP and ILAAP in […]

ESMA briefs on suitability

ESMA has updated its supervisory briefing for regulators on the suitability requirements under MiFID 2. The briefing covers: when a suitability assessment is needed; information to clients on the assessment; getting information from clients; arrangements necessary to understand products; arrangements necessary to understand the suitability of an investment; suitability report; staff qualifications; and record keeping.

ESAs consult on PRIIPs KID changes

The ESAs are consulting on proposed amendments to the PRIIPs KID.  The consultation follows the ESAs’ letter to the Commission on developing guidance on information on investment funds. It also noted the need to make targeted amendments to the PRIIPs delegated Regulation to apply the PRIIPs KID requirements appropriately to UCITS and relevant non-UCITS funds, […]

ESMA publishes draft Brexit RTS for uncleared derivatives

ESMA has published a report with draft RTS that would amend the 3 Commission Delegated Regulations on EMIR. ESMA is proposing a limited exemption that would facilitate novation of certain non-centrally cleared OTC derivatives to EU counterparties for a specific time-window in the event of a no-deal Brexit. The proposals would allow novation without triggering the […]

ESMA renews binary option ban

ESMA has renewed its ban on the marketing, distribution or sale of binary options to retail consumers for a further 3 months from January 2019.

Call for interest in new payment Standards Advisory Panel

The Bank of England and Pay.UK are inviting expressions of interest from senior stakeholders who could represent the payments industry on a newly created Standards Advisory Panel.  The new Panel will focus on the implementation of ISO20022, but also cover also payments standards for the UK. The deadline for applications is Monday 10 December 2018.

CMA proposes definitions in investment consultancy study

CMA has published a consultation paper as part of its review of the investment consultancy and fiduciary management services study. The paper contains draft definitions. The proposals define: “investment consultancy service” and “fiduciary management service” The paper also notes that other terms, such as “pension scheme trustees” and “interconnected body corporate” will need separate definition. […]

FCA publishes new Market Watch

The latest edition of Market Watch focuses on “flying prices” and “printing trades” – where firms communicate to clients that they have bids or offers that are not actually supported by an instruction and then communicate that a trade has taken place when it has not. This risks trading decisions being made based on misleading […]

HM Treasury publishes further Brexit SIs

As part of its preparation for the contingency of a ‘hard’ Brexit, HM Treasury has published draft onshoring legislation relating to: Payment accounts Financial markets infrastructure insolvency  Central securities depositories and Investment funds and managers  The changes made under these SIs are unlikely to take effect if an implementation period is agreed.

FCA writes to CEOs on SIPP due diligence

FCA has written a “Dear CEO” letter on the duties of SIPP operators in respect of due diligence. The letter refers to the judgement in the Berkeley Burke case and several other pending civil claims, and asks firms to consider the potential implications of these cases for them and their customers. The Berkeley Burke case, […]

Cryptoassets task force publishes report

The Cryptoassets task force, led by Treasury, has published its report on the UK’s policy and regulatory approach to cryptoassets.  The report looks at the policy and regulatory implications of DLT and cryptoassets and comments on the considerable risks as well as the potential benefits. Now the Task force will consult on a number of initiatives, specifically: […]

BoE consults on fees for non-UK CCP applications

The Bank of England is consulting on the proposed fee for applications for non-UK CCPs that will seek UK recognition both before and after Brexit. Comments and feedback on all aspects of the proposal are sought by 2 January.

Further Brexit SIs published

HMT has published the latest set of Brexit transition draft and updated draft SIs to be made under the EU Withdrawal Act 2018 in the event of a ‘hard’ Brexit, and accompanying explanatory notes.  These cover: Central Securities Depositories Over the Counter Derivatives, Central Counterparties and Trade Repositories  Financial Conglomerates and Other Financial Groups (explanatory […]

FSB holds its plenary meeting

The Financial Stability Board (FSB) has published a press release following its plenary meeting in Ottawa, in which it reviewed the financial vulnerabilities and deliverables for the G20 Summit. Points of interest include: The Plenary discussed market developments and vulnerabilities in the global financial system. The members considered that, while global growth remained solid, it […]

FCA publishes information for registering as a trade repository

As part of its Brexit preparations, the FCA has updated its webpage for incoming trade repositories that wish to ensure they can continue to do business in the UK following Brexit. Firms are now able to complete draft application forms for registration as a trade repository.  The FCA has also published guidance notes for this […]

ESMA publishes report on ICOs and Crypto-Assets

ESMA has published an own initiative report on additional steps it can take to contain the risks for investors arising from ICOs and crypto-assets (noting that there are no obvious related stability risks as yet). The report recommends that: additional guidance is produced by EMSA on the interpretation of MiFID with respect to applicability to […]

FCA evaluates bringing additional benchmarks into the regulatory and supervisory regime

FCA has today published Evaluation Paper 18/2 on the impact of bringing additional benchmarks into the regulatory and supervisory regime. The paper is the second of a new series of FCA evaluations on its past interventions. Background Misconduct and benchmark manipulation cases and FSA investigations led the Government to ask Martin Wheatley to establish an […]

PIFMA concerned about FOS limit increase

PIFMA is concerned that the proposed extension of the upper limits of compensation FOS can order firms to pay out, from £150, 000 to £350,000 could put some small firms out of the market as they will be unable to get affordable PII cover. From 1 April, 2019, FCA is proposing to increase the limits […]

FCA Feedback Statement on Digital Regulatory Reporting

The FCA has published a feedback statement on digital regulatory reporting. This follows the FCA’s call for input on smarter regulatory reporting in February 2018. The FCA found that most respondents agreed that there are significant potential benefits to be gained by introducing digital regulatory reporting, with the most commonly cited benefit being increased efficiency. However, […]

FCA publishes DP on climate change and green finance

Climate change is thought to have a significant impact on the UK’s financial services market and has led the FCA to publish its Discussion Paper on climate change and green finance (DP18/8). In its DP, the FCA recognises that the risks from climate change will affect the risks and value to some investments, noting that […]

FCA consults on Statements of Responsibilities and Responsibilities Map guidance

The FCA has published a consultation on proposed  guidance to help solo-regulated firms draft their Statements of Responsibilities (SoR) and (for enhanced firms) Responsibilities Maps, in preparation for the SMCR extension in December 2019. Although targeted at solo-regulated firms, the FCA notes that the guidance may also be useful for dual-regulated firms preparing or updating […]

Treasury updates Brexit SIs

Treasury has published some new draft statutory instruments to be made under the EU (Withdrawal) Act, or announced plans to make them, and also updated existing drafts. New or updated documents include Regulations on : plans for the Solvency II and Insurance measures Bank Recovery and Resolution Credit Rating Agencies (FCA has also published an […]

FCA publishes Brexit consultations following HMT Guidance

As heralded at the end of last year, the FCA has now published two consultation papers that make provision for operations in the event of a ‘hard’ Brexit next March. The first consultation sets out changes to the FCA’s Handbook and to those EU Binding Technical Standards, which, it is proposed, would be incorporated directly […]

Industry body calls for review of PRIIPs Regulation

Following the FCA’s Call for Input into the implementation of the PRIIPs Regulation, the Personal Investment Management and Financial Advice Association (PIMFA) has commented that it agrees with concerns about the practical operation and the detailed KID requirements of the regime. In particular, PIMFA has noted that there is a suggestion that UCITS and other […]

Up next from FCA

FCA’s latest policy development update promises various publications before the end of this year, including: policy statement on the approach to the final RTS and EBA guidelines under PSD 2, in December; policy proposals on regulatory fees and levies for 2019/20, in November; and review of permitted links rules for insurers in relation to Patient […]

AFME publishes guidance on COBS

AFME has published guidance on financial analysts’ interaction with representatives of private companies and their financial advisers under the revised rules in COBS 12.2.21 which took effect in July. The change stemmed from the MiFID Org Reg, which states that financial analysts should not engage in activities other than the preparation of investment research where […]

ESMA updates MiFID 2 and MiFIR FAQs

ESMA has updated its FAQs on MiFID 2 and MiFIR on market structures and transparency.  New questions look at: how derivatives are classified for transparency purposes amending an existing question on the default liquidity status of bonds the scope of the MiFIR pre-trade transparency waiver market making activities and incentives in stressed trading consitions bulk […]

ESMA updates MiFID and MiFID II materials

ESMA has published an update to its Q&As  on MiFID II and MiFIR, answering questions relating to investor protection and intermediaries.  The answers address: best execution: reporting for firms using a venue’s RFQ system to agree a trade; and investment advice on an independent basis: use of a ‘look-through’ approach. EMSA has also formally withdrawn […]

CMA brings forward investment consultant report date

The CMA has announced that it is bringing forward the date for publishing its final report on its investigation into the supply and acquisition of investment consultancy and fiduciary management services in the UK. Having considered the responses to its Provisional Decision Report, the CMA has announced that it will aim to publish its final […]

ESMA speaks on MiFID 2 and Brexit

Steven Maijoor has spoken on the state of implementation of MiFID 2 and preparing for Brexit. He focussed on the impact of MiFID 2 on non-EU trading venues – in particular looking at the impact of the trading obligation and on secondary markets and transparency.  He looked also at the role and increase in market […]

ESMA publishes 2019 work programme

ESMA has published its 2019 work programme. As ever, its top priority is supervisory convergence. It will be working particularly on prospectuses, investment funds and MiFID 2 as well as cross-cutting supervisory themes. Of course, all activities will consider Brexit.  It also plans to work on improvement of data quality and risk monitoring and further […]

ESMA writes to Commission on third-country regimes

ESMA has written to the European Commission on various issues which are relevant in the context of Brexit but also to third-countries generally. There has already been discussion on the MiFID 2/MiFIR requirements on trading venues, and this letter now addresses: how MiFIR treats third country firms providing services and activities to ECPs and per […]

ESMA confirms and updates product intervention on CFDs

ESMA has confirmed the further extension of the restriction on marketing, distributing and selling CFDs to retail clients, for another three months. Alongside the extension it has updated its FAQs, particularly to clarify how the measures apply to rolling spot forex.

PRA reviews risks of climate change to banks

The PRA has published a report examining the impact of climate change on banks in terms of financial risk implications. The report notes that 70% of banks recognise that climate change poses financial risks to their business model, for example, and immediately, exposures to mortgaged homes at risk of flooding or by investments in countries […]

MEPs back proportional rules for investment firms

MEPs from ECON have backed the Commission’s proposal for a proportionate regime for smaller, non-systemic investment firms. The proposals suggest that firms’ whose total average monthly assets over a 12 month period exceed €30 bn should be subject to the current capital requirements for banks, but that smaller firms can either be regulated at that […]

Latest Market Watch focuses on transaction reporting

FCA’s latest Market Watch focuses on market conduct and transaction reporting issues. It follows up on previous editions, which looked at FCA’s conclusions from a series of supervisory visits on suspicious transaction reporting. FCA had been concerned about over-reliance on “out of the box” alert calibration and that surveillance was not very developed for some asset […]

FCA consults on applying SM&CR to CMCs

The FCA has opened a consultation that sets out how it will apply the Senior Managers and Certification Regime (SM&CR) to Claims Management Companies (CMCs), following taking over regulation of them from 1 April 2019. The consultation also sets out when SM&CR may apply to CMCs, and what action they will need to take. The […]

Ringleader sentenced in the FCA’s largest fraud prosecution

Michael Nascimento, the controlling mind of a £2.8m investment fraud was sentenced to 11 years’ imprisonment in the Southwark Crown Court. Between July 2010 and April 2014, members of the public were cold-called and subjected to high pressure sales tactics to persuade them to purchase shares in a company that owned land on the island of Madeira. […]

FCA publishes direction on recognised overseas investment exchanges

The Treasury is not planning to include EEA market operators in the proposed arrangements enabling incoming firms and businesses to continue to operate immediately after Brexit. Accordingly if EEA market operators are no longer able to rely on MiFID II passporting rights (eg because a transitional deal is not agreed), they may need to have […]

FCA creates new adviser re-evaluation test

FCA and the Chartered Insurance Institute have worked together to create a re-assessment test of the level 4 diploma in financial planning. The new “Regulated Retail Investment Adviser Re-Evaluation” will be available from October. FCA encourages firms to use the test and may ask them to use it as part of its supervisory activities if […]

ESAs report on financial advice automation

The joint committee of ESAs has published the results of its monitoring exercise on automation in financial advice. The ESAs found that automation is growing but that there are still only a limited number of firms and customers involved. Moreover, the risks many had identified with the practice have not materialised, not least because most […]

FCA bans individual

FCA has confirmed its ban on Arif Hussein following a decision of the Upper Tribunal published in June.  Mr Hussein was a derivatives trader with UBS, who engaged in internal chats with a UBS trader-submitter knowing that it would be improper to participate in conduct intended to influence UBS’ LIBOR submissions.  FCA found that Mr […]

ESMA renews binary option ban

ESMA has confirmed the ban on binary options will remain in place for a further three months. The current ban, which prohibits marketing, distribution or sale of binary options to retail clients, expires on 2 October. ESMA has reviewed the specific features of certain binary options which make them less risky and as a result […]

Treasury publishes “no-deal” guidance

Treasury has published guidance for the banking, insurance and other financial services sectors on the impact of what it still describes as an “unlikely” no-deal Brexit scenario. It stresses that increased preparations towards a no-deal were always likely to be necessary the closer Brexit becomes and that accelerating the plans does not mean the Government […]

Law Commission confirms status of electronic signatures

In December 2017 the Law Commission confirmed that one of the projects it would be working on was addressing the absence of explicit case law and legislation that has given rise to uncertainty as to the validity of electronic signatures in some cases. Consequently, the Law Commission has now published early conclusions from its review […]

FSB launches peer review of LEIs

The Financial Stability Board has published the Summary Terms of Reference of a thematic peer review of the implementation of the Legal Entity Identifier. The thematic review seeks feedback from a range of stakeholders on issues such as: awareness and adoption of the LEI in various jurisdictions; types of private sector uses of the LEI; […]

Standard setters consult on incentives for OTC derivatives clearing

The FSB,  Basel Committee, the CPMI and IOSCO have published a joint consultation on incentives to centrally clear OTC derivatives. The organisations want to look at how the post-crisis measures have worked and whether there is a need to fine-tune them. A post-reform evaluation suggests that there are overall good incentives for using central clearing, […]

FCA updates on high-risk products and retail investors

FCA has added its own views on selling high-risk speculative investments to retail clients. It fully supports ESMA’s measures and notes that ESMA has also recognised the risks of products similar to CFDs. However, it is concerned firms will try to get around the ESMA product intervention restrictions by selling to retail investors products that […]

ESMA updates product intervention FAQs

ESMA has updated its FAQs on the use of its temporary product intervention measures in respect of CFDs and binary options.  New questions: state that turbo certificates are not within the scope of the CFD decision as they have different product features to CFDs, including that they are transferable securities for MiFID purposes and are […]

PRA consults on CRR definition of default

The PRA has today published its consultation paper (CP) 17/18 on the definition of default.  The CP follows the European Banking Authority’s (EBA) Opinion on the implementation of the regulatory review of internal rating based (IRB) models. Background The EBA put together a list of regulatory products for the IRB framework review, with the “aim […]

FCA updated guidance for firms outsourcing IT

The FCA has updated FG 16/5, ‘Guidance for firms outsourcing to the ‘cloud’ and other third party IT services’. This update takes account of the publication of the European Banking Authority’s recommendations, and changes to relevant legislation.    

Corporate governance reporting and the impact on large private companies

We have written an article on the new corporate governance reporting requirements for certain large private companies. The requirements will come into force on 1 January 2019 applying to financial years beginning on or after 1 January 2019, with reporting effectively commencing in 2020 for the previous year. We also cover the consultation launched on […]

FCA seeks views on PRIIPs experience

FCA has opened a Call for Input to get firms’ and consumers’ initial experiences of the PRIIPs requirements.  It welcomes comments generally, but particularly in respect of: determining whether a product is within or out of scope; and the practical aspects of cost and risk disclosure requirements. The Call for Input usefully summarises the various […]

FCA seeks feedback on price discrimination in the cash savings market

The FCA has published a discussion paper on price discrimination in the cash savings market. The FCA is concerned that longstanding customers receive lower interest rates on easy access cash savings accounts products than those received by customers who shop around; and that competition is not working well in the cash savings market, particularly for customers that […]

FCA publishes intervention approach documents

On a new page on its website, ‘Measuring our impact before we intervene‘, the FCA has published a group of documents that aim to provide an indication of how the FCA assesses the likely impact of its policies. These documents consist of: a paper setting out the FCA’s approach to conducting cost benefit analyses for […]

PRA consults on regulatory reporting

The PRA has published an occasional consultation paper on regulatory reporting. The consultation paper sets out proposed changes to the following reporting requirements: discontinuance of Prudent Valuation Return PV001; changes to PRA reporting instructions to align with updated EBA requirements; amendments to Pillar 2 reporting templates and instructions to reflect their application to ring-fenced bodies; […]

ESAs update KID FAQs

The ESAs have published some further guidance on KIDs under the PRIIPS Regulation. The additions to the existing guidance provide some additional FAQs and updates to the flow diagrams for risk and reward calculations. New questions include confirmation that a KID must be published on the public section of the manufacturer’s website, and guidance on […]

FSB looks at crypo-asset market monitoring

The Financial Stability Board has reported to the G20 Finance Ministers and Central Bank Governors on its work in relation to crypto-asset markets. It has worked with the CPMI to set up a framework for monitoring the financial stability implications of market developments, and has been working out the metrics for monitoring that it will […]

FCA publishes interim report on investment platforms

FCA has published the interim findings of its market study on competition in the investment platform market. It has concluded that competition is working well for most consumers, but has identified a few areas that need attention to help consumers. It found: barriers to switching are significant and therefore the pressure on platforms to continue […]

FSB statement on reforming interest rate benchmarks

  The Financial Stability Board (FSB) has published a statement on reforms to interbank offered rates (IBORs) and the development of overnight risk-free rates (RFRs) and term rates. Points of interest include: to ensure financial stability, benchmarks which are used extensively must be especially robust; the Official Sector Steering Group (OSSG), set up to coordinate […]

Andrew Bailey speaks on the transition from LIBOR

The FCA has published a speech by Andrew Bailey, Chief Executive of the FCA, on transitioning from LIBOR to alternative interest rate benchmarks. Although important steps have been taken towards transition, Andrew Bailey commented that the transition is not yet fast enough and there is much further to go. Points of interest in the speech […]

FCA proposes further consumer support and protection in the retirement income market

The FCA has launched a consultation on a package of measures designed to protect consumers, improve engagement and promote competition in the retirement income market. Alongside the consultation, the FCA has published the final report of its Retirement Outcomes Review, an investigation into how the pensions and retirement income sector has been working since the […]

FCA and PSR Chair discusses potential future algocracy

Charles Randell, the recently appointed Chair of the FCA and the PSR, has delivered a speech, in which he discussed the increasing dominance of algorithms in our day to day lives, and noted some of the consequent issues that will need to be grappled with, as  the rise of Big Data, AI and machine learning […]

FCA thinks about price discrimination

FCA has published a paper looking at how it should approach fairness in price discrimination in financial services. It notes that price discrimination is not in itself unfair as practices such as student discounts are widely accepted. But others are more controversial, such as where longstanding customers receive a worse deal than new ones. Views […]

Discussion Paper on building the financial sector’s operational resilience

The Bank of England, the PRA and FCA have published a joint discussion paper on its approach to improve operational resilience in the financial sector. The regulators envisage that boards and senior managers can achieve better standards of operational resilience through increased focus on setting, monitoring and testing specific impact tolerances for key business services. […]

BoE sets out next steps for prudential regulation of banks: present and future

Vicky Saporta, Executive Director for Prudential Policy at the Bank of England delivered a keynote speech on 4 July at The Westminster Business Forum.  The speech focused on the impact of Basel III, which was finalised on 7 December 2017, and discussed the achievements of the reforms, its finalisation and what lies ahead. Achievements The […]

Changes in terminology. PRA updates its Supervisory Statements

The PRA updated a number of its Supervisory Statements (SSs) on 4 July 2018 to reflect changes in terminology, following the publication of policy statement 15/18 “Strengthening individual accountability in insurance: Extension of the Senior Managers and Certification Regime to insurers”. A list of those SSs can be found below. SS28/15 “Strengthening individual accountability in […]

Insurance Europe’s SII conference

On 26 June, insurers, policymakers and regulators attended Insurance Europe’s Solvency II Conference.  The theme of the conference, which was held in Brussels, was ” Two years on and two reviews”. Michaela Koller, Insurance Europe director general opened the conference, which featured two panel debates. The first debate “Two years on – Solvency II in […]

Prospectus exemptions amended

The FSMA (Prospectus and Markets in Financial Instruments) Regulations 2018 take effect on 21 July and amend two of the thresholds that trigger the requirement to produce a prospectus. The changes reflect the 2017 EU Prospectus Regulation and: increase the threshold amount for offers to trigger the prospectus requirement from €100,000 to €8 million; and reduce […]

FCA makes new rules

FCA has made new rules. The changes affect several parts of the Handbook, including: miscellaneous minor and clarificatory changes, including a change to the application chapter of SYSC to clarify that certain rules in SYSC 4.3A do not apply to an AIFM investment firm that is not a CRR firm; changes to make the Handbook consistent […]

HMT, Bank of England and FCA set out approach to onshoring financial services legislation

The Treasury, the Bank of England and the FCA have published information about how financial services legislation will be on-shored under the EU (Withdrawal) Act, in particular to ensure the (hopefully unlikely) ‘hard Brexit’ scenario is addressed, if the negotiated implementation period is not able to take effect from March 2019. The Treasury intends to lay […]

Industry publishes MiFID 2 distributor templates

PIMFA and TISA have published a MiFID 2 Feedback Template and a guide on distributor reporting. It hopes the documents will help firms to meet their responsibilities under MiFID 2 and particularly that the Q&A will help distributors to make compliant returns to asset managers. Comments are welcome on the proposed template until 12 July. […]

Mansion House 2018: Speech by the Chancellor of the Exchequer

HM Treasury has published a speech by Philip Hammond, Chancellor of the Exchequer, which was delivered at the annual Mansion House dinner. In his speech, Mr Hammond focused on Brexit and financial services. He said that the UK needs to ensure that it remains a world leader in innovation, and extend London’s position as the […]

Mansion House 2018: BoE Governor gives speech – ‘New Economy, New Finance, New Bank’

Mark Carney, Governor of the BoE, delivered a speech at the annual Mansion House dinner on how the UK financial system can continue to serve the UK and the world, in the face of major structural changes. In his speech, Mr Carney outlined how the BoE is changing to support the development of the UK […]

Law Commission opens consultation on expanded definition of ‘insurable interest’

The Law Commission and the Scottish Law Commission have published an updated bill that proposes an expansion to the concept of insurable interest for life-related insurance. By using the term ‘life-related insurance’, the bill intends to create a wider category of insurance than just traditional life insurance, thereby also covering other forms of insurance which […]

ESMA confirms end of LEI grace period

ESMA has issued a statement confirming that the six month grace period granted to those required by MiFIR to have a Legal Entity Identifier (LEI), will end on 2 July 2017. ESMA will now work with national competent authorities to develop a supervision action plan which focuses on compliance with LEI reporting requirements.

PRA publishes Policy Statement and Supervisory Statement on Algorithmic Trading

The PRA has issued PS12/18 and SS5/18, which sets out the PRA’s expectations of a firm’s risk management and governance of algorithmic trading.  The SS applies to all algorithmic trading activities of a firm, including in respect of unregulated financial instruments such as spot foreign exchange.  It should be read in conjunction with other applicable requirements, including […]

EP adopts “EMIR Refit” proposal

The European Parliament has voted in plenary session to adopt the so called “EMIR Refit” Regulation. The European Commission has proposed that small financial counterparties (SFCs) should not be subject to the current EMIR clearing obligation where they deal with OTC derivatives at a low volume which would not present a systemic risk to the financial […]

ESMA speaks on a genuine single market

Verena Ross has spoken on progress towards a “genuine” single European financial market, focusing on the role of regulation and supervision. She commented that the EU now has a robust and integrated regulatory framework but stressed the importance of supervision. She discussed the importance of taking the time and effort required for proper implementation and […]

New Chair of the Court of the Bank of England appointed

HM Treasury and the Bank of England have announced that Bradley Fried has been appointed as Chair of the Court of the Bank of England, with effect from 1 July 2018. He will replace Sir Anthony Habgood who has been Chair since 2014.

Up next from FCA

FCA’s latest Policy Development Update heralds a policy statement on fees and levies rates in July. Otherwise its timetable is quiet, with a policy statement on the MMF Regulation due at some point together with feedback on an increasing number of proposals from quarterly consultations going back 2 years.

ESMA exercises product intervention powers

ESMA has exercised its product intervention powers under MiFIR to: ban the marketing, distribution or sale or binary options to retail investors from 2 July; and restrict the marketing of CFDs to retail investors from 1 August. The restrictions consist of leverage limits on opening positions, a margin close-out rule and a negative balance protection […]

FOS Annual Review published

The FOS has published its Annual Review for 2017/2018. Many of the complaints statistics highlight products that are the subject of ongoing regulatory scrutiny and activity: the FOS notes significant increases in complaints in home credit, hiring, leasing and renting, and payday loans: putting to one side PPI, one in four new complaints related to […]

ESMA publishes MiFID 2 suitability guidelines

ESMA has published its final guidelines on certain aspects of the MiFID 2 suitability requirements. The guidelines build on their MiFID 1 predecessor, and broaden them to address technological developments such as a the development of robo-advice and take into account supervisory experience and the results of reviews and surveys. The guidelines also include a […]

ESMA updates MiFID 2 FAQs

ESMA has updated its FAQs on investor protection and intermediaries under MiFID 2. New questions added in May focus on: best execution: a new question addresses what is meant by “other liquidity provider”; client categorisation: new questions look at when and how a firm can assess whether it can treat an individual private investor as a professional client, […]

BoE publishes FEMR update

BoE, FCA and Treasury have published the progress report on the Fair and Effective Markets Review. It says significant progress has been made towards the recommendations. Key conclusions are that: the work on extending the SMCR will achieve the policy intent of the accountability framework already in place for PRA regulated credit and investment institutions; […]

HM Treasury: Cryptoassets Taskforce meets for the first time

The first meeting of the UK’s new Cryptoassets Taskforce took place on 21 May 2018. The Taskforce was first announced in April by the Chancellor of the Exchequer as part of the Government’s Fintech Sector Strategy. Senior leaders from the Government and the financial regulators met to agree the Taskforce’s objectives, which include exploring the impact of cryptoassets, […]

FCA consults on consumer contract variations

FCA is consulting on guidance for firms setting out what factors under the Consumer Rights Act they should take into account when they are drafting and reviewing variation terms. The draft guidance sets out a list of things FCA says firms should take into account, which would include: how valid the reason for variation is […]

Financial Guidance and Claims Act gets Royal Assent

The Financial Guidance and Claims Act has received Royal Assent. The Act: establishes a single financial guidance body, and sets out its objectives, functions and funding details. It also sets out requirements on regulators to make guidance and permits the making of regulations that ban unsolicited direct marketing relating to pensions and other financial products […]

FCA retires retail advice guidance

FCA has confirmed that it will “retire” with immediate effect FG12/15: RDR: independent and restricted advice, and FG14/1: Supervising retail investment advice: inducements and conflicts of interest. It consulted last December on the proposal to do so, as it considers their content has been largely superseded by rule changes, including those implementing MiFID 2.

ESMA sets up central register portal

ESMA has created a new portal for checking the authorisation status of investment firms, trading venues and DRSPs authorised under MiFID 2, UCITS management companies and AIFMs and also funds managed or marketed in the EU.

Up next from FCA

FCA’s latest Policy Development Update promises over the next couple of months the overdue feedback on fees and levies policy proposals with consultation on rates proposals.  No dates are set for any other key papers.

FCA publishes second 5 Conduct Questions report

The FCA has published its second annual report setting out responses from wholesale banking firms to the FCA’s conduct question set.  The FCA notes that the second report indicates progress has been made from the time when 5 Conduct Questions were first introduced, in 2015. The FCA indicates that they intend to extend the 5 […]

FCA publishes new FSCS funding rules

Following its consultation in 2017, the FCA has now published its final rules on reformed FSCS funding.  These rules will take effect from April 2019. Additionally the FCA has opened a consultation on draft rules relating to Professional Indemnity Insurance requirements for Personal Investment Firms, CP 18/11.  The proposed rules will require that policies do […]

EU updates on retail product distribution

The European Commission has reported that consumers still face some obstacles when trying to compare investment funds, life insurance or personal pensions. The report finds that recent EU measures, such as MiFID 2 and the PRIIPs Regulation, should help, but that consumers find a great variance in costs for similar product categories cross-border. It also says most consumers […]

Claims Management regulations published for consultation

As part of the proposed process of transferring the regulation of Claims Management Companies to the FCA, HM Treasury is consulting on draft regulations  that will form part of a final statutory instrument creating a new framework of regulation for Claims Management Companies (CMCs). The draft regulations set out the proposed permissions that CMCs will […]

UK and US announce working group creation

HM Treasury and the US Treasury Department have announced the formation of a Financial Regulatory Working Group, to formalise engagement on bilateral regulatory cooperation. The group is scheduled to meet twice a year

FCA creates new basic advice page

FCA has created a new page on its website explaining the basic advice regime under MiFID 2 and the IDD. It explains it needed to update its guidance to firms to explain the impact of these pieces of legislation. In particular, it addresses how it needed to apply some MiFID 2 requirements (or “at least […]

BEIS publishes Green Paper on modernising consumer markets

The Department for Business, Energy and Industrial Strategy is consulting on proposals which, among other issues, seek to to improve the consumer experience in regulated markets for utilities, telecommunications and financial services and to ensure consumers buying and selling online benefit from new technology and business models, and have appropriate protection for their personal data. […]