As part of the Brexit preparations, the BoE and ESMA have published an MoU setting out cooperation and information-sharing arrangements in relation to CCPs and CSDs. This agreement, and the adoption by the EC of temporary equivalence decisions for UK CCPs and CSDs, will facilitate continued recognition of UK CCPs and CSDs and their continued […]

ESMA has published its Regulatory Work Programme for 2019, setting out ESMA’s Single Rulebook work. The matters it is working on for the forthcoming year include: Post-trading RTS under EMIR; RTS relating to registration requirements under the European Social Entrepreneurship Funds Regulation and the European Venture Capital Funds Regulation; and A report to the Commission on […]

As part of its follow up work to its asset management market study, the FCA has published new rules and guidance to help asset managers and customers understand more about how funds are being managed. The new provisions include: guidance on how fund managers should describe fund objectives and investment policies; requirements for how benchmarks, where […]

The European Commission has adopted delegated regulations under the EuSEF Regulation (346/2013) and the EuVECA Regulation (345/2013). These Regulations respectively introduced measures to allow venture capital funds to market their funds across the EU using a single set of rules. They also made provision for delegated regulations to be developed to specify requirements such as […]

The latest Corruption Perceptions Index contains few shocks, but a few pithy observations from Transparency International.  The top 10 includes 4 Nordic nations, and comprises Denmark, New Zealand, Finland, Singapore, Sweden, Switzerland, Norway, the Netherlands, Canada and Luxembourg. The UK is joint 11th, with Germany. All these countries scored 80 or more. At the bottom, […]

FCA has set out how it proposes to use its temporary powers under the draft legislation Treasury has put forward. It plans in principle to make transitional measures that will ensure that firms do not need to prepare now to make Brexit-related changes to their business. Wherever possible, these transitional arrangements would apply. But in […]

The Commission has published the final form of RTS under MLD4 aimed at better and more consistent measures in approaching ML/TF risk where credit or financial institutions have a presence in a third country whose laws do not permit group-wide policies. The RTS set the ideal minimum standards groups should attain, and how they should […]

FCA and PRA are consulting on the management expenses levy limit (MELL) for FSCS for the 2019/2020 year. They propose an increase of 2.4% over the current year with a levy for FSCS management expenses of £74.6m and an unlevied contingency reserve of £5m.  The consultation includes a breakdown of costs between fee blocks. Responses […]

The Banking Standards Board is consulting on draft good practice guidance on regulatory references. The guidance will be all the more important later this year when the SMCR extends the regulatory references requirements to virtually all firms. Bearing in mind the purpose of the guidance is essentially to stop “rolling bad apples” making their way […]

FCA has published a detailed policy statement to back up the new rules on regular premium PPI complaints and recurring non-disclosure of commission. FCA stresses that one of the main purposes of its consultation and now the new rules is to ensure that customers who may have made complaints about mis-selling of PPI that were […]

The FCA is working with the the FRC to set out proposals and a discussion paper encouraging asset managers and others managing investments to take a closer interest in the operation of the businesses in which they invest. The FCA consultation is on measures implementing the second Shareholders Rights Directive which mainly affects FCA regulated […]

The FCA is inviting views on proposals to require firms to report certain value measures data on a wide range of GI products. This consultation follows the identification of issues of poor value in the GI market, and a pilot trialed in 2016 involving reporting requirements and publication of the resultant data sets. Under the […]

FCA has provided some further guidance to help firms filling in the NPPR forms.

FCA is consulting on measures to improve retirement outcomes for consumers. Its concern is that consumers are using the pensions freedoms to move into drawdown and hold funds in investments that will not meet their needs. It feels consumers focus only on taking their tax-free cash and take the easiest method available to drawdown. To […]

The Upper Tribunal has ruled on whether any part of costs claimed by Alistair Burns (on his unsuccessful application) should be awarded. The Tribunal has discretion over the award of costs, but can only make the award if it considered that FCA had acted unreasonably in bringing, defending or conducting the proceedings, or that the […]

At the World Economic Forum in Davos, the Swiss and UK governments signed a deal to allow both countries to trade freely within the insurance sector post-Brexit. The agreement will come into force when the current EU-Swiss insurance agreement ceases to apply to the UK. The agreement will replicate the effects of the existing EU-Swiss […]

On 25 January 2019 EIOPA published findings of its peer review, which examined how national competent authorities (NCAs) assess the propriety of administrative, management or supervisory body (AMSB) members and qualifying shareholders.  The review was initiated following a number of cross-border cases indicating a lack of harmonisation with regards to the propriety assessment across the […]

The Solicitors Disciplinary Tribunal has fined Khalid Sharif, a director and solicitor at Child & Child, who was also the firm’s MLRO £45,000 for failings under the (then) 2007 MLRs, which were also breaches of SRA Principles and rules. It found that, for just over a year, Mr Sharif: failed to take any or any adequate […]

Ireland and Luxembourg have both made announcements designed to give comfort to their funds that use UK based portfolio managers: The Deputy Governor of the Bank of Ireland said in a speech that it was making good progress in its preparations for a hard Brexit.  These will include ensuring that consumers can continue to be […]

FCA’s latest Handbook Update lists rules made in December and January.  The key changes: amend the rules on PCAs and Overdrafts from 18 December 2019: these changes amend BCOBS and CONC to tackle low levels of consumer awareness of and engagement with overdrafts; amend DISP to require lenders and sellers to write to certain Plevin complainants […]

CMA has published its administrative timetable for implementation of the investment consultancy and fiduciary management market remedies.  There will be: Consultation on the draft Order in February; Notification to the EU of any proposals that would be super-equivalent to MiFID 2 in April; and the statutory deadline for implementing the remedial action in June.

FMLC has written to Treasury with its key observations on the FSMA (EU Exit) Regulations.  The Committee is concerned at some wording proposed in relation to the financial promotion rules. Specifically, FCA has power to make rules that apply to authorised persons in relation to communications they make or approve if rules are necessary to […]

The Treasury Committee has started a new inquiry looking at financial services in the UK after Brexit. Its focus is to look at: what the UK’s financial services priorities should be when negotiating the UK’s future trading relationships with the EU and third countries; how the sector can take advantage of the new environment, including […]

SFO has published the terms of a DPA it has entered into with Tesco Stores Ltd following events in 2014 which resulted in the company creating a false account of its financial position by overstating its profits. As part of the DPA, which was agreed in 2017 but in relation to which reporting restrictions have […]

The PSR has published its final terms of reference for its market review into the supply of card-acquiring services. the review will look at a variety of issues including how merchants buy the services, whether there are alternatives to them and what the market is delivering for both merchants and consumers. The PSR aims to […]

The Treasury has written to the Treasury Committee enclosing a draft of secondary legislation that would give temporary transitional powers to the UK financial regulators in the event of a no-deal Brexit that would enable firms and the financial markets to function properly while requirements stemming from EU laws are embedded into UK laws. The […]

ISDA has published an updated webpage with FAQs on the impact of Brexit on ISDA documentation.

As the FCA prepares for the extension of SMCR to most solo-regulated firms next December, it is consulting on a few areas regarding the existing regime for banks and large insurers previously  identified as wanting attention. The proposals set out in CP19/4 include: excluding the legal function from the scope of SMCR; amend the scope of […]

The FCA is consulting on draft guidance on activities that the FCA regulates in this area. Noting that this is an area in which investor activity is on the increase, and where there is still uncertainty about where the regulatory perimeter falls, the guidance will provider greater clarity, and also assist consumers in knowing what […]

The Wolfsberg Group has published new guidance on how financial institutions should carry out their sanctions screening. It says its guidance is intended to help institutions see how screening can form an effective part of a wider sanctions compliance programme. The guidance looks at: what screening is – and the fundamentals of transaction and customer […]

A set of oral evidence given to the Treasury Committee includes statements from FCA that: it is now content on how to interpret the mortgage affordability test compliantly with the MCD and now plans to consult on changing it from an absolute test to a relative test; it will be carrying out perimeter work on SME lending […]

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 […]

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 […]

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 […]

ESMA has published a set of consultation papers on sustainable finance initiatives, seeking views on: draft technical advice on integrating sustainability risks and factors into MiFID 2, the AIFMD and UCITS Directives frameworks; and CRA guidelines aimed at improving the quality and consistency of environmental, social and governance factors when considered as part of a […]

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 […]

The FCA has published final guidance for social landlords to help them understand when they may be acting as a credit broker in the course of assisting tenants find lower cost credit providers. FG18/6 will assist such social landlords in identifying whether they are likely to need authorisation and if so how to go about […]

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.

Following the Patient Capital Review on regulatory barriers to investment in illiquid “patient capital” assets FCA is consulting on: changes to the COBS 21.3 permitted links rules to enable retail investors to invest in patient capital through unit-linked funds and more generally on how UK authorised funds can be used to invest in patient capital. […]

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 […]