United Kingdom (and EU regulation)

FCA publishes Decision Notices concerning the market disclosure and related conduct of a premium listed issuer, its CEO and Finance Director

The FCA has decided to fine a premium listed issuer, Cathay International Holdings Limited (Cathay) £411,000 for a number of breaches of the Listing Principles and the Disclosure and Transparency Rules.  In addition, the FCA has decided to fine Cathay’s CEO £214,300 for being knowingly concerned in those breaches and its Finance Director £40,200 for … Continue Reading

UK Finance principles for exiting a customer

On 4 June 2019, UK Finance, a trade association for the UK financial services sector, published its principles for exiting a customer – which have been developed with input from the FCA. The principles are designed to improve how banks communicate with customers when they cannot offer, or continue to provide, banking facilities. The principles … Continue Reading

PRA modification of consent of definition of capital rules

On 10 June 2019, the PRA published a direction for modification by consent, modifying in its Rulebook the Definition of Capital 7.1 and 7.5. In an accompanying press release, the PRA notes that, following amendments to Article 26(3) of the Capital Requirements Regulation (CRR), firms may classify as Common Equity Tier 1 (CET1) instruments subsequent … Continue Reading

G20 communique from June 2019 meeting

On 10 June 2019, the G20 published a communique, detailing the discussion points from the G20 Finance Ministers and Central Bank Governors meeting held on 9 June 2019. Key takeaways from the communique as regards financial services include: G20 members should consider assisting financial institutions to make any needed adjustments to their business models and … Continue Reading

EMIR Refit

Introduction The EMIR Refit Regulation (EMIR Refit) will enter into force on 17 June 2019. With some exceptions, it will apply from that date. The purpose of the EMIR Refit is to amend and simplify the European Markets Infrastructure Regulation (EMIR) “to address disproportionate compliance costs, transparency issues and insufficient access to clearing for certain … Continue Reading

The FCA has published its long-awaited thematic review on money laundering risks in capital markets

Today (just to note TR19/4 was published on 4/6), the Financial Conduct Authority (FCA) published its latest thematic review, TR19/4, which looks at money laundering (ML) risks in capital markets. The FCA visited 19 market sector operators, including investment banks, recognised investment exchanges, clearing and settlement houses, trade bodies, inter-dealer brokers, trading firms and a … Continue Reading

FCA Policy Development update

On 7 June 2019, the FCA updated its ‘policy development update’ webpage, detailing recent and upcoming FCA publications. Amongst other things, the updated webpage notes the following publications are expected to be published shortly: policy statement on the high-cost credit review: buy now pay later – due June 2019; price discrimination in the cash savings … Continue Reading

Approach document on FCA’s role under the PSRs 2017 and the EMRs 2011

On 7 June 2019, the FCA published an updated approach document on its role under the Payment Services Regulations 2017 and the Electronic Money Regulations 2011.The updated approach document adds guidance on refused payment fees. The majority of the updated guidance can be found at paragraph 8.251 of the approach document.… Continue Reading

Latest FCA Quarterly Consultation includes SM&CR amendments

On 7 June 2019, the FCA published its latest Quarterly Consultation (No. 24). The Quarterly Consultation provides for the following proposed changes to the FCA Handbook: chapter 2 – modifications to General Provision (GEN) and fees and levy rate rules (FEES) for 2019/20 in relation to Gibraltar based firms; chapter 3 – the introduction of … Continue Reading

PRA consults on resolution assessments and reporting amendments

On 7 June 2019, the PRA published Consultation Paper 12/19: Strengthening individual accountability: resolution assessments and reporting amendments (CP12/19). In CP12/19 the PRA proposes amending: Rule 4.1.(10) in the Allocation of Responsibilities Part of the Rulebook so that the senior manager who is assigned the prescribed responsibility for recovery plans and resolution packs would, for … Continue Reading

FSB publishes consultation on SME financing evaluation

On 7 June 2019, the Financial Stability Board (FSB) issued a consultation on an Evaluation of the effects of financial regulatory reforms on small and medium-sized enterprise (SME) financing. The evaluation has been delivered to G20 Finance Ministers and Central Bank Governors for their meeting in Fukuoka on 8-9 June. The evaluation examines the effects … Continue Reading

CRR II Regulation and CRD V Directive published in OJ

On 7 June 2019, there was published in the Official Journal of the EU (OJ): Regulation (EU) 2019/876 of the European Parliament and of the Council of 20 May 2019 amending the Capital Requirements Regulation as regards the leverage ratio, the net stable funding ratio, requirements for own funds and eligible liabilities, counterparty credit risk, … Continue Reading

BRRD II Directive and SRM II Regulation published in OJ

On 7 June 2019, there was published in the Official Journal of the EU (OJ): Directive (EU) 2019/879 of the European Parliament and of the Council of 20 May 2019 amending the Bank Recovery and Resolution Directive as regards the loss-absorbing and recapitalisation capacity of credit institutions and investment firms and Directive 98/26/EC (BRRD II); … Continue Reading

Hope for investors in London Capital & Finance as FSCS continues to explore whether there are grounds for compensation

London Capital & Finance (LC&F), which collapsed in January 2019, was authorised by the FCA in relation to its promotional activities. However, the actual sale of mini-bonds by LC&F was not a regulated activity and so not typically protected by the Financial Services Compensation Scheme (FSCS), which has called into question the scope of protection … Continue Reading

FCA policy statement and near final rules on Securitisation Regulation

On 6 June 2019, the FCA published Policy Statement 19/15: Securitisation (Amendment) (EU Exit) Regulations 2019 and Securitisation Regulations 2018 (near final and final rules) (PS19/15). The Securitisation (Amendment) (EU Exit) Regulations 2019 (the Brexit SI) will come into force on the day the UK leaves the EU in a hard Brexit scenario, and will … Continue Reading

FSB report on decentralised financial technologies

On 6 June 2019, the Financial Stability Board (FSB) published a report considering the implications of decentralised financial technologies. The report considers the financial stability, regulatory and governance implications of the use of decentralised financial technologies such as those involving distributed ledgers and online peer-to-peer, or user-matching, platforms. The report focuses on technologies that may … Continue Reading

New ESG insight page

We have launched a new environmental, social and governance (ESG) page on our Asset Management Regulation knowledge hub. This page is called ‘ESG insight’. ESG insight contains resources and materials to guide asset managers through the evolving regulatory landscape on ESG, features include: videos from our financial services team discussing UK and EU regulatory developments … Continue Reading

IOSCO report on sustainable finance in emerging markets and role of securities regulators

On 5 June 2019, the International Organization of Securities Commissions (IOSCO) published a final report on sustainable finance in emerging markets and the role of securities regulators. IOSCO notes that during the past several years, market participants, regulators and policy makers have increasingly focused their attention on issues concerning sustainable finance in its many forms. … Continue Reading

Treasury Committee launches inquiry into decarbonisation of the UK economy

On 5 June 2019, the House of Commons’ Treasury Committee announced that it was launching an inquiry into the decarbonisation of the UK economy and green finance. The inquiry will scrutinise the role of HM Treasury, regulators and financial services firms in supporting the Government’s climate change commitments. It will also examine the economic potential … Continue Reading

FCA and Dutch regulator announce closer partnership

On 5 June 2019, the FCA announced that it has signed an agreement with the Dutch Authority for the Financial Markets (AFM) to work more closely together to protect and enhance the integrity and stability of both countries financial systems. Since the UK announced its intention to withdraw from the EU, several financial institutions currently … Continue Reading

Application of ESMA guidelines on commodity derivatives definitions under MiFID II

On 5 June 2019, the European Securities and Markets Authority (ESMA) announced published a press release announcing that it has published the official translations of its guidelines on the application of C6 and C7 of Annex 1 of MiFID II. Member State national competent authorities must notify ESMA by 5 August 2019 as to whether … Continue Reading

CPMI / IOSCO discussion paper on CCP default management auctions

On 5 June 2019, the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) jointly published a discussion paper on central counterparty (CCP) default management auctions. A default management auction is one of the tools that a CCP may use to transfer a defaulting participant’s positions or subset thereof … Continue Reading

Regulation amending ITS on supervisory disclosure under CRD IV published in OJ

On 5 June 2019, there was published in the Official Journal of the EU, Commission Implementing Regulation (EU) 2019/912 of 28 May 2019 amending Implementing Regulation (EU) No 650/2014 laying down implementing technical standards with regard to the format, structure, contents list and annual publication date of the information to be disclosed by Member State … Continue Reading