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Topic: Regulation and compliance

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FCA Dear CEO letter to financial advisers on asset management supervision strategy

On 20 January 2020, the FCA published a Dear CEO letter to asset managers setting out the key areas of harm asset managers pose to their customers and markets in which they operate. Overall, the FCA has observed that standards of governance, particularly at the level of the regulated entity, generally fall below its expectations. … Continue Reading

FCA Dear CEO letter to financial advisers on areas of concern

On 21 January 2020, the FCA published a Dear CEO letter to financial advisers setting out its approach to tackling key areas of concern and summarising the actions expected of financial advice firms to undertake: assessing suitability of advice and disclosure review. The FCA will be conducting a second assessing suitability review focusing on initial … Continue Reading

FSB Global Monitoring Report on Non-Bank Financial Intermediation 2019

On 19 January 2020, the Financial Stability Board (FSB) published its Global Monitoring Report in Non-Bank Financial Intermediation 2019. The report sets out the results of the FSB’s most recent annual monitoring exercise that assesses global trends and risks from non-bank financial intermediation (NBFI). It covers data up to end-2018 from 29 jurisdictions, which together … Continue Reading

February 40 minute briefing seminar: Managing your relationship with the regulators

Our extended 40 minute briefing on 5 February 2020 will be a practical workshop involving lawyers and compliance professionals leading roundtable discussions that provide insight into the FCA’s and PRA’s approach to the scenarios set out below and the good and poor practices they have observed from firms: Managing the supervisory relationship on a business-as-usual … Continue Reading

Supervising international banks: revision of the branch return

On 17 January 2020, the PRA updated its webpage concerning Policy Statement 17/19: Supervising international banks: revision of the branch return. On its webpage the PRA states that it has identified that the branch return form published on 12 September 2019 contains incorrect validations in Part 3. Specifically, validation BRv011 should only apply to column … Continue Reading

Financial Services Compliance & Risk Conference

Our risk consulting team is pleased to sponsor the Financial Services Compliance & Risk Conference, a one-day industry-led conference taking place on March 4, 2020 in London. Amidst increased regulatory expectations, emerging technologies and changing business models, financial services companies must continue to evolve their risk and compliance strategies. This conference will see compliance and risk … Continue Reading

IOSCO recommends synchronising clocks used for timestamping with UTC

On 16 January 2020, the International Organization of Securities Commissions (IOSCO) published a report recommending that trading venues and their participants synchronise the clocks they use for timestamping a reportable event with coordinated universal time (UTC). UTC is computed by taking the weighted average of more than 300 atomic clocks located in more than 80 … Continue Reading

GFiN report on cross-border testing pilot lessons learned

On 16 January 2020, the Global Financial Innovation Network (GFiN) published a report on the lessons learned on the cross-border testing pilot. The GFiN was created to provide a more efficient way for innovative firms to interact with regulators, helping them navigate between countries as they look to scale and test new ideas. It also … Continue Reading

Regulators’ consult on FSCS management expenses levy limit for 2020/21

On 16 January 2020, the PRA and FCA co-published a consultation paper setting out proposals for the management expenses levy limit (MELL) for the Financial Services Compensation Scheme (FSCS) for 2020/21. The proposed MELL is £83.2 million for 2020/21, consisting of a management expenses budget of £78.2 million and an unlevied contingency reserve of £5 … Continue Reading

ESMA starts publishing questions received through its Q&A process

On 10 January 2020, the European Securities and Markets Authority (ESMA) published a list of questions currently under development through its Q&A process. The publication of the list comes in the context of the entry into force of the revised ESMA Regulation including its new provisions applicable to Q&As (new Article 16b), which require ESMA … Continue Reading

FCA and BoE announce proposals for data reforms across the UK financial sector

On 7 January 2020, the Bank of England (BoE) published a Discussion Paper, Transforming data collection from the UK financial sector, to improve the timeliness and effectiveness of data collection from firms across the financial system. On the same date the FCA refreshed its Data Strategy setting out a transformation plan to become a highly … Continue Reading

ESMA report on issuers’ use of APMs

On 20 December 2019, the European Securities and Markets Authority (ESMA) published a report on EU issuers’ use of alternative performance measures (APMs) and their compliance with the ESMA APM guidelines. The report highlights that the use of APMs is widespread in all sectors and within all regulated documents. Significant diversity exists in the number … Continue Reading

European System of Financial Supervision reforms – legislation published in OJ

On 27 December 2019, there was published in the Official Journal of the EU (OJ): Regulation (EU) 2019/2175 (Regulation concerning the powers, governance and funding of the European Supervisory Authorities); Directive (EU) 2019/2177 (Directive amending MiFID II and the Solvency II Directive); and Regulation (EU) 2019/2176 (Regulation amending the Regulation establishing the European Systemic Risk … Continue Reading

FCA update on Financial Services Regulatory Phoenixing Group

On 20 December 2019, the FCA published a press release providing an update on its Financial Services Regulatory Partners Phoenixing Group. The group, established in April 2019, aims to tackle the ongoing issue of ‘phoenixing’ in the financial services sector. Phoenixing in this context involves firms and individuals deliberately seeking to avoid their liabilities to … Continue Reading

ESMA announces MiFID scheduled publication dates for 2020

On 19 December 2019, the European Securities and Markets Authority (ESMA) published its 2020 calendar of MiFID II / MiFIR relevant publications for the transparency regime and systematic internalisers’ tests. During 2020, ESMA will publish for the first-time transparency and systemic internalisers calculations for derivatives. During 2019, publications on derivatives were not executed given the … Continue Reading

EBA consults to revise standards to identify staff with a material impact on the institution’s risk profile

On 19 December 2019, the European Banking Authority (EBA) issued a consultation paper on draft regulatory technical standards (RTS) on the criteria to identify all categories of staff whose professional activities have a material impact on the institutions’ risk profile. The draft RTS have been revised in light of Article 94(2) of CRD IV as … Continue Reading

AFME, FIA, ICMA, ISDA and ISLA publish Master Regulatory Reporting Agreement

On 19 December 2019, the  Association of Financial Markets in Europe, Futures Industry Association, International Capital Market Association, International Swaps and Derivatives Association, Inc. and International Securities Lending Association co-published a new agreement intended to simplify reporting across different EU regulatory regimes. The Master Regulatory Reporting Agreement gives market participants an option to use a … Continue Reading

FCA Primary Market Bulletin No. 26 and amended Knowledge Base

On 17 December 2019, the FCA published Primary Market Bulletin (PMB) No. 26. This issue of PMB provides a number of updates to the technical and procedural notes in the FCA’s Knowledge Base to reflect the new Prospectus Regulation, which came into effect on 21 July 2019. The amended technical notes include: Eligibility process Circulation … Continue Reading

ESMA proposes strengthened rules to address undue short-termism in securities markets

On 18 December 2019, the European Securities and Markets Authority (ESMA) published a report on undue short-term pressure on corporations. The report is in response to the call for advice from the European Commission as part of its Action Plan, Financing Sustainable Growth, and will inform policy actions that could be taken to ensure that … Continue Reading

ISO 20022 CHAPS migration: ‘Like-for-like’ message set and update

On 16 December 2019, the Bank of England (BoE) updated its webpage on the new messaging standard for UK payments, ISO 20022 in relation to the introductory phase of the ISO 20022 CHAPS migration. The BoE has published the final ‘like-for-like’ message set for the Introductory Phase of the ISO 20022 CHAPS migration. This documentation … Continue Reading

Political agreement reached on the “taxonomy Regulation”

On 17 December 2019, the European Parliament announced that negotiators from the European Parliament and Council of the EU had reached an agreement concerning the so-called “taxonomy Regulation” which sets out criteria to determine whether an economic activity is environmentally sustainable. The agreement reached by the European Parliament negotiating team will first need approval by … Continue Reading

ESRB recommendation on exchange of information on foreign branches

On 9 December 2019, the European Systemic Risk Board (ESRB) published a recommendation on the exchange and collection of information for macro-prudential purposes on branches of banks having their head office in another Member State or in a third country. The ESRB also published a report which provides an analysis on the topic. The report: … Continue Reading