United Kingdom (and EU regulation)

UK investment funds´ mandatory marketing notification procedures for Germany after 31 December 2020

On 19 November 2020, the German Regulator (BaFin) issued a notice on UK investment funds and their status in light of the imminent expiry of the transition period and the UK qualifying as a third country after 31 December 2020. Currently, UK UCITS and AIFs benefit from the EU-passport regime, which facilitates marketing of EU-UCITS … Continue Reading

Capital treatment of securitisations of non-performing loans

On 26 November 2020, the Basel Committee on Banking Supervision published a technical amendment ‘Capital treatment of securitisations of non-performing loans’. The technical amendment closes a gap in the Basel framework by setting out prudent and risk sensitive capital requirements for non-performing loan securitisations. The Basel Committee has agreed to add the following elements to … Continue Reading

Publication of the 2021 EPC SEPA payment scheme rulebooks

On 26 November 2020, the European Payments Council (EPC) published the 2021 payment scheme rulebooks and the related implementation guidelines. All 2021 payment scheme rulebooks enter into force on 21 November 2021. Annex IV of each 2021 rulebook contains a table summarising all changes made in each 2021 rulebook compared to the 2019 rulebook.… Continue Reading

Market risk: Calculation of risks not in value at risk, and stressed value at risk – PS23/20

On 26 November 2020, the PRA published Policy Statement 23/20: ‘Market risk: Calculation of risks not in value at risk, and stressed value at risk’ (PS23/20). In PS23/20 the PRA provides feedback to responses to Consultation Paper 15/20: ‘Market risk: Calculation of risks not in value at risk, and stressed value at risk’ (CP15/20). It … Continue Reading

Commission Implementing Decision on time limited equivalence determination for UK CSDs

On 26 November 2020, there was published in the Official Journal of the EU,  Commission Implementing Decision (EU) 2020/1766 of 25 November 2020 determining, for a limited period of time, that the regulatory framework applicable to central securities depositories of the United Kingdom of Great Britain and Northern Ireland is equivalent in accordance with Regulation … Continue Reading

European Parliament publishes adopted amendments to MiFID II in light of COVID-19

On 25 November 2020, the European Parliament published the amendments that it had adopted on the proposed Directive amending MiFID II as regards information requirements, product governance and position limits to help the recovery from the COVID-19 pandemic. The next step is for the Council of the EU to adopt the proposed Directive.  … Continue Reading

FMLC response to call for evidence – UK’s international regulatory cooperation strategy

In December 2018, the UK’s Better Regulation Executive  invited the Organisation for Economic Cooperation and Development (OECD) to conduct a review into the UK’s international regulatory cooperation practices.  The OECD published a report in May 2020 recommending that HM Government ensure more systematic consideration of international regulatory cooperation across government and regulatory bodies. In response, HM Government … Continue Reading

The Bearer Certificates (Collective Investment Schemes) Regulations 2020

On 24 November 2020, there was published on legislation.gov.uk The Bearer Certificates (Collective Investment Schemes) Regulations 2020. The Small Business, Enterprise and Employment Act 2015 (SBEE 2015) amended the Companies Act 2006 to prohibit the issuance of new bearer certificates by companies and provided for a transitional conversion of existing bearer certificates into ordinary registered … Continue Reading

FCA statement on reporting of securities financing transactions under the UK SFTR after the transition period

On 25 November 2020, the FCA issued a statement explaining what trade repositories (TRs), and the UK counterparties that use them, should do to make sure they are compliant with the UK Securities Financing Transactions Regulation (UK SFTR) reporting obligations from the end of the transition period. The statement covers the following topics: What changes … Continue Reading

FCA statement – reporting of derivatives under UK EMIR after the transition period

On 25 November 2020, the FCA issued a statement explaining what trade repositories (TRs), and the UK counterparties that use them, should do to make sure they are compliant with the onshored European Market Infrastructure Regulation (UK EMIR) reporting obligations following the end of the transition period. The statement replaces the statement the FCA originally … Continue Reading

ESMA sets out its final view on the derivatives trading obligation (DTO)

On 25 November 2020, the European Securities and Markets Authority (ESMA) made a public statement setting out its view on the application of the EU trading obligation for derivatives (DTO) following the end of the Brexit transition period. Article 28 of MiFIR requires investment firms to conclude transactions in some derivatives on regulated markets (RMs), … Continue Reading

ESMA final report – EMIR RTS on the clearing obligation regarding intragroup transactions as well as on novations from UK to EU counterparties

On 24 November 2020, the European Securities and Markets Authority (ESMA) published a final report presenting a new set of draft regulatory technical standards (RTS) on the clearing obligation that the European Supervisory Authority has developed under Article 5(2) of the European Market Infrastructure Regulation (EMIR). The draft RTS cover: The treatment of certain intragroup … Continue Reading

Global comparative guide – Senior management responsibility in financial services

We have updated our cross border comparative guide on individual accountability which is located on the NRF Institute. The comparative guide, Senior management responsibility in financial services, allows clients to better understand how senior management responsibility in different types of financial services firm other than insurers is being treated in different jurisdictions around the world. … Continue Reading

ESAs propose to adapt the EMIR implementation timelines for intragroup transactions, equity options and novations to EU counterparties

On 23 November 2020, the European Banking Authority (EBA), the European Insurance and Occupational Pensions Authority (EIOPA) and the European Securities and Markets Authority (ESMA) (together the ESAs) co-published a final report with draft regulatory technical standards (RTS) proposing to amend the Commission Delegated Regulation on the risk mitigation techniques for over-the-counter (OTC) derivatives not … Continue Reading

Investing with purpose: placing stewardship at the heart of sustainable growth

On 24 November 2020, the Asset Management Task Force (Taskforce) published a report, Investing with purpose: placing stewardship at the heart of sustainable growth.   Established in October 2017, the Taskforce was designed to encourage greater dialogue between the Government, the investment industry and the FCA to ensure the UK investment industry continues to deliver … Continue Reading

FCA announces benefits of new data collection platform RegData

On 24 November 2020, the FCA published a new web page regarding the benefits of its new data collection platform RegData. The FCA is moving firms and their users to RegData in groups to minimise the impact on firms. Firms’ moving dates are determined by their reporting requirements. All users must register for RegData ahead … Continue Reading

EBA calls on the Commission to harmonise the significant risk transfer assessment in securitisation

On 23 November 2020, the European Banking Authority (EBA) published a report on significant risk transfer (SRT) in securitisation transactions, which includes a set of detailed recommendations to the European Commission on the harmonisation of practices and processes applicable to the SRT assessment. The EBA proposals aim to enhance the efficiency, consistency and predictability of … Continue Reading

Sustainable Finance and Taxonomy: Commission launches public consultation on criteria defining environmentally sustainable activities

On 22 November 2020, the European Commission issued a consultation on a draft delegated act under the Taxonomy Regulation. The Taxonomy Regulation establishes the framework for the EU taxonomy by setting out four conditions that an economic activity must meet in order to qualify as environmentally sustainable: It contributes substantially to one or more of … Continue Reading

FCA Portfolio letter – credit reference agencies and credit information service providers

On 20 November 2020, the FCA published a letter it had sent to the boards of directors of firms that have been assigned to the credit reference agencies (CRAs) and credit information service providers (CISPs) portfolio. The purpose of the letter is to: Set out the FCA’s view of the key risks of harm CRAs … Continue Reading

FCA speech – Building trust in sustainable investments

On 23 November 2020, the FCA published a speech by Richard Monks (Director of Strategy, FCA) entitled Building trust in sustainable investments. The speech was delivered at the SRI Services and Partners ‘Good Money Week’ panel discussion on 21 October 2020. During his speech Mr Monks states that the FCA is considering whether it would … Continue Reading

UK STS notifications – templates and user guide

The onshored Securitisation Regulation transfers the responsibility for maintaining a list of STS securitisations from European Securities and Markets Authority (ESMA)  to the FCA. From the end of the transition period, the FCA will maintain a list of securitisations duly notified to it as meeting UK STS criteria. To qualify as UK STS, the originators … Continue Reading

IFSB publishes FAQs on four of its standards

On 23 November 2020, the Islamic Financial Services Board (IFSB) published its third set of FAQs on the following standards: Guiding Principles on Corporate Governance for Institutions Offering Only Islamic Financial Services (IIFS) (IFSB-3). Guiding Principles on Governance for Islamic Collective Investment Schemes (ICIS)” (IFSB-6). Standard on Risk Management for Takāful Undertakings (IFSB-14). Technical Note … Continue Reading

FSB examines financial stability implications of climate change

On 23 November 2020, the Financial Stability Board (FSB) published a report that discusses the potential implications of climate change for financial stability. It investigates channels through which climate-related risks might impact the financial system. The report: Sets out the ways in which physical and transition risks from climate change can affect financial stability, as … Continue Reading

Leaders’ Declaration – G20 Riyadh Summit

On 22 November 2020, the G20 leaders issued a declaration following their summit in Riyadh on 21 – 22 November 2020. Paragraphs 16 to 18 of the declaration cover financial sector issues. Key points include: The pandemic has reaffirmed the need to enhance global cross-border payment arrangements to facilitate cheaper, faster, more inclusive and more … Continue Reading
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