Germany

Topic: Financial Institutions

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ESMA seek feedback from market participants on the practical aspects of MiFID II and MiFIR implementation

On 1 September 2020 the European Services and Markets Authority (ESMA) published a call for evidence to gather insights and feedback from market participants relating to the practical implementation of MiFID II and MiFIR provisions for equity and non-equity instruments. ESMA seek responses on a dedicated template on or before 31 October 2020. Historically, ESMA … Continue Reading

EMSA proposes further postponement to February 2022 to the implementation of new regulatory technical standards for CSDR

On 26 August the European Securities and Markets Authority (ESMA) published its final report relating to the postponement of the effective date of new regulatory technical standards (RTS) on settlement discipline pursuant to Central Securities Depositories Regulation (CSDR). The RTS was initially planned to come into force on 13 September 2020, but in May 2020 … Continue Reading

The European Commission and Financial Markets Law Committee feed back to European Parliament on AML regulation of virtual currencies

On 2 June 2020 the European Parliament posed questions relating to the registration and monitoring of Virtual Asset Service Providers (VASPs) in Member States as required by the provisions of the 5th EU Anti-Money Laundering Directive (5AMLD). VASPs include virtual currencies, fiat currencies and custodian wallet providers. Responses were received from the Financial Markets Law … Continue Reading

The Institute of International Finance feeds back on the European Commission’s AML/CTF action plan

On 26 August the Institute of International Finance (IIF) provided feedback to the European Commission on its Action Plan for a comprehensive Union policy on preventing money laundering and terrorist financing, published in May 2020. The IIF notes that a more coordinated approach to implement and oversea the EU’s anti-money laundering (AML) and counter terrorism … Continue Reading

EBA updates data for the global systemically important institutions (G-SIIs) for the 2019 period

On 20 August, the European Banking Authority (EBA) updated data relating to the 37 largest institutions in the EU whose leverage ratios exceed EUR 200 billion. This in turn will be used to identify a smaller group of banks which are considered to be global systemically important institutions (G-SIIs). This is the first year that … Continue Reading

BaFin puts distribution policies regarding dividends and bonuses of German insurers and pension funds in the context of COVID-19 under scrutiny

In accordance with its habit to upload links to EIOPA publications relating to the aligned policy of European supervisors in light of the current coronavirus crisis, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) on 2 April 2020 published a note in which it referred to EIOPA’s statement of the same date … Continue Reading

BaFin publishes FAQ on current supervisory measures for German insurers and pension funds in light of COVID-19

On 18 March 2020 and 21 March 2020 the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) published notes in which it referred to and appropriated EIOPA publications on Actions to mitigate the impact of Coronavirus/COVID-19 on the EU insurance sector (dated 17 March 2020) and Recommendations on supervisory flexibility regarding the deadline … Continue Reading

Coronavirus/COVID-19: German regulator on conduct of business rules

After the European Securities and Markets Authority (ESMA) had issued a public statement regarding the application of MiFID II requirements on the recording of telephone conversations on 20 March 2020 (see the related publication in our blog), the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) published additional guidance to market participants on the same … Continue Reading

German regulator publishes governance guidelines for small insurers

Before the impact of Coronavirus/COVID-19 materialized and lead to a shut down of much of the public life in Germany, on 6 March 2020, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht, BaFin) published its Circular 01/2020 (VA) on Minimum Requirements under Supervisory Law on the System of Governance of small Insurance Undertakings (Circular). … Continue Reading

Coronavirus/COVID-19: German regulator grants temporary relief for supervised entities (update)

After having taken initial steps to deal with the impact of the COVID-19 pandemic on the financial sector in Germany (see the related publication in our blog), the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) has taken further relief measures. In order to give supervised entities a better overview of these measures, … Continue Reading

Coronavirus/COVID-19: German regulator grants temporary relief for supervised entities

After having stated that it will closely monitor the risk situation caused by the new coronavirus (SARS-CoV-2) with a view to potential reactions, the German Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) has now taken initial steps to deal with the impact of the pandemic on the financial sector in Germany. Relief for … Continue Reading

ESG: German regulator publishes guidance notice on sustainability

The German Federal Financial Supervisory Authority (BaFin) has issued a guidance notice on dealing with sustainability risks (ESG Guidance Notice). The binding German version was published on 20 December 2019 and later editorially modified on 13 January 2020. Further, BaFin has now also made available an English convenience translation. The German regulator had launched a consultation based on … Continue Reading

Tomorrow’s financial services webinar – Prudential regime for investment firms

As previously advertised, this month’s financial services briefing will take place tomorrow in the form of a webinar rather than a seminar. In this webinar we will discuss the proposed approach to the prudential classification of investment firms and the new capital requirements methodology. We will then look at the new reporting requirements and remuneration provisions. … Continue Reading

German regulator publishes English version of guidance regarding outsourcing by insurers to cloud services

The German regulator BaFin has published an English version of its guidelines published in November 2018, Link. The guidance specifies the contractual provisions which BaFin expects to be included in agreements between German regulated insurers, reinsurers and credit institutions and cloud service providers.… Continue Reading

IOSCO consults on UTC clock synchronisation of timestamped events

On 11 September 2019, the International Organization of Securities Commissions (IOSCO) published a consultation paper (CR04/19) recommending that trading venues and their participants synchronise the business clocks used to record the time and date of a reportable event with co-ordinated universal time (UTC). The proposal follows a recommendation from an earlier IOSCO report published in … Continue Reading

German government plans to introduce a cap on insurance commissions

The amount of insurance commissions paid to insurance intermediaries for the placement of life insurance contracts has been a thorn in the side of consumer protection groups and the German insurance regulator BaFin for years. Another area which came increasingly in the focus of the regulator’s attention are payment protection policies and the related remuneration … Continue Reading

BaFin publishes new guidance note on the authorization procedure for credit institutions

The German Federal Financial Supervisory Authority (BaFin) published a new guidance note (Merkblatt) on the authorization procedure for credit institutions. The guidance note provides details on the regulatory requirements for the licensing of credit institutions (e.g. information about the intended business and the applicant, business plan, governance structure, management pursuant, holders of significant participation, capital … Continue Reading

BaFin says that insurers need to be prepared for substantial burdens in their implementation of the new German law transposing IDD

Insurers and other insurance distributors will face significant challenges while implementing the requirements of the German law transposing IDD. Impacts on distribution models, training requirements and increased duties and obligations in distribution will need to be considered. In addition, there are a number of compliance issues, such as conflicts of interest, cross-selling and considerations regarding … Continue Reading

BaFin publishes draft circular on product oversight and governance arrangements for retail banking products

The German Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) has published a new draft circular on product oversight and governance arrangements for retail banking products with the objective of strengthening consumer protection in relation to financial products offered in the market. The draft circular shall govern how financial institutions are expected to control and manage the … Continue Reading

German law transposing Insurance Distribution Directive (IDD) passed (in revised version) – final guidance on training requirements remains outstanding

The legislation transposing the IDD into German law has been passed (as resolved by the German Parliament on 28 June 2017 and by the Federal Council of Germany on 7 July 2017). One of many changes will be that the transposed IDD will be applicable to all insurance distributors (Versicherungsvertreiber), including insurers. In addition to … Continue Reading

Brexit workshop for foreign issuers of securities organized by BaFin

On May 2017, the German Federal supervisory authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) organized a workshop for foreign issuers of securities. BaFin representatives held various presentations on the possible consequences of Brexit. Three major questions were discussed taking into account various Brexit scenarios: Which issuers of securities prospectuses are concerned? What are the effects on … Continue Reading

German regulators work on proposals for “Small Banking Box” regulation

The German Federal Financial Supervisory authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) and the German Central Bank (Deutsche Bundesbank) are currently working on a draft proposal for the so-called “Small Banking Box” regulation. The aim of the “Small Banking Box” is to specify the principle of proportionality in banking regulation. The new proposal suggests that small and … Continue Reading

German regulator publishes additional information requirements regarding equity funds

On 4 April 2017, the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) published its interpretation decision (the “Decision”) regarding information to be provided in the sales prospectus. BaFin’s decision addresses the latest discussion about “closet indexing”; which means that  the management of an investment fund is described as “active” in the sales prospectus … Continue Reading

Third regulatory survey on low yield environment

The German Central Bank (Deutsche Bundesbank) and the Federal Financial Supervisory Authority (Bundesanstalt für Finanzdienstleistungsaufsicht – BaFin) have conducted a survey on the revenue situation and resilience of German banks in the low yield environment. The previous surveys in 2013 and 2015 have shown that the low interest rate environment poses continuous negative challenges on … Continue Reading
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