On 27 December 2023, the Financial Services and the Treasury Bureau (FSTB) and the Hong Kong Monetary Authority (HKMA) jointly issued a public consultation paper on their legislative proposal to regulate issuers of stablecoin. The Hong Kong Government has decided that, in light of the important roles played by stablecoins in the Web3 and virtual … Continue Reading
On 27 December 2023, the Financial Services and the Treasury Bureau (FSTB) and the Hong Kong Monetary Authority (HKMA) jointly issued a public consultation paper on their legislative proposal to regulate issuers of stablecoin. The Hong Kong Government has decided that, in light of the important roles played by stablecoins in the Web3 and virtual … Continue Reading
On 18 December 2023, the Financial Services and Markets Act 2023 (Digital Securities Sandbox) Regulations 2023 (SI 2023/1398) were published, along with an explanatory memorandum. The Regulations create the first financial market infrastructure (FMI) sandbox, the Digital Securities Sandbox (DSS), which is intended to allow firms and the regulators to test the use of new … Continue Reading
On 19 December 2023, the International Organization of Securities Commissions (IOSCO) published a final report with policy recommendations to address market integrity and investor protection issues in decentralised finance (DeFi). The policy recommendations, which are principles-based and outcomes-focused, are addressed to relevant authorities and complement IOSCO’s policy recommendations for crypto and digital assets markets issued … Continue Reading
On 19 December 2023, the Financial Conduct Authority (FCA), the Bank of England (BoE) and the Prudential Regulation Authority (PRA) published the latest annual CBEST thematic report. CBEST tests the cyber resilience of firms and financial market infrastructures (FMIs) through live testing that mimics the actions of cyber attackers. The report, which contains cyber resilience … Continue Reading
On 15 December 2023, the European Parliament’s Economic and Monetary Affairs Committee published a draft report on the proposed Regulation on a framework for financial data access (FIDA). The FIDA proposal seeks to enable consumers and firms to more efficiently control access to their financial data beyond payments thereby allowing them to benefit from financial … Continue Reading
On 14 December 2023, the European Securities and Markets Authority (ESMA) issued a Discussion Paper on MiFID II investor protection topics linked to digitalisation. The Discussion Paper discusses the main trends in digitalisation that are linked to the MiFID II investor protection topics. MiFID II aims at being technology neutral. This means that market participants … Continue Reading
On 11 December 2023, the European Banking Authority (EBA), European Securities and Markets Authority (ESMA) and European Insurance and Occupational Pensions Authority (EIOPA) – together, the European Supervisory Authorities (ESAs) – published a report on ‘innovation facilitators’, a term that encompasses innovation hubs and regulatory sandboxes. The report identifies several benefits and challenges relating to … Continue Reading
On 8 December 2023 the European Supervisory Authorities (ESAs) launched public consultation on a second package of technical standards under Digital Operational Resilience Act (DORA). This includes the following draft regulatory technical standards (RTS), implementing technical standards (ITS) and guidelines: RTS and ITS on content, timelines and templates on incident reporting By way of background, … Continue Reading
On 7 December 2023, the Prudential Regulation Authority (PRA), Financial Conduct Authority (FCA) and Bank of England (BoE) jointly published a Consultation Paper (CP) on Operational resilience: Critical third parties to the UK financial sector (PRA CP26/23 and FCA CP23/30). The CP sets out the proposed requirements to be established in rules and accompanying expectations for … Continue Reading
On 24 November 2023, a Technology Working Group of industry experts established by HM Treasury’s Asset Management Taskforce issued a report, UK Fund Tokenisation – A Blueprint for Implementation. Tokenisation refers to the issuing of units that are recorded on a distributed ledger, as opposed to units that are recorded on more traditional systems of … Continue Reading
On 24 November 2023, the European Banking Authority (EBA) issued a public consultation on new guidelines on preventing the abuse of funds and certain crypto-asset transfers for money laundering and terrorist financing purposes. Regulation (EU) 2023/1113 on information accompanying transfers of funds and certain crypto-assets recasts Regulation (EU) 2015/847 and extends its scope to the … Continue Reading
On 23 November 2023, UK Finance published a report on the impact of artificial intelligence (AI) in financial services, including opportunities, risks and policy considerations. The report examines the state of play of AI in the financial sector – where it is being deployed, where it shows promise for the future and how to make … Continue Reading
On 22 November 2023, HM Treasury (HMT) published its response to the July 2023 consultation on the Digital Securities Sandbox (DSS). The response sets out the Government’s final approach to implementing the DSS, which will facilitate the use of digital assets in financial markets. The DSS will be the first Financial Market Infrastructure (FMI) Sandbox … Continue Reading
On 15 November 2023, the Basel Committee on Banking Supervision issued a discussion paper which provides a high-level assessment of the supervisory and financial stability implications of digital fraud for the global banking system. It is structured around three broad sets of questions: The discussion paper does not make a formal distinction between retail and … Continue Reading
Key takeaways from Hong Kong Fintech Week Hong Kong Fintech Week 2023 saw several new policy and regulatory announcements by the Financial Services and the Treasury Bureau (the FSTB), the Securities and Futures Commission (the SFC) and the Hong Kong Monetary Authority (the HKMA). The key developments are summarised below: SFC guidance on engaging in … Continue Reading
On November 7, 2023, the Consumer Financial Protection Bureau issued a proposed rule to supervise larger nonbank companies that offer services like digital wallets and payment apps. Read our client alert here.… Continue Reading
On 9 November 2023, the European Securities and Markets Authority (ESMA) announced that it is changing its Union strategic supervisory priorities (USSPs) to focus on cyber risk and digital resilience alongside ESG disclosures. With this new priority, EU supervisors will put greater emphasis on reinforcing firms’ information communication technology risk management through close monitoring and … Continue Reading
On 6 November 2023, the Financial Conduct Authority (FCA) and Bank of England (BoE) published discussion papers on their proposed approach to regulating stablecoins, and the Prudential Regulation Authority (PRA) published a Dear CEO letter on innovative uses of deposits, e-money and stablecoins. The FCA, BoE and PRA also published a joint “roadmap paper” aimed … Continue Reading
On 1 November 2023, the International Regulatory Strategy Group (IRSG) (a joint venture between the City of London Corporation and TheCityUK) published a policy paper on a coherent and interoperable international regulatory framework on artificial intelligence (AI). In this policy paper, the IRSG stresses the importance of creating a globally coherent approach in order to … Continue Reading
On 31 October 2023, the FCA announced that it will be partnering with regulators across the world as part of the Monetary Authority of Singapore’s (MAS) Project Guardian, a collaborative initiative with the financial industry that explores fund and asset tokenisation use cases and decentralised finance. The FCA joins MAS, Singapore’s central bank, the Financial … Continue Reading
On 31 October 2023, the Bank for International Settlement’s Committee on Payments and Market Infrastructures (CPMI) published a report on considerations for the use of stablecoin arrangements in cross-border payments. The report highlights a range of considerations and challenges regarding the use of stablecoin arrangements in cross-border payments but does not recommend any particular features. … Continue Reading
On 30 October 2023, HM Treasury (HMT) published its final proposals for the future financial services regulatory regime for cryptoassets in the UK. These proposals are set out in HMT’s response to its February 2023 consultation and call for evidence (CfE) on the topic, its response to the May 2022 consultation on managing the failure … Continue Reading
Background On 20 October 2023, the Securities and Futures Commission (SFC) and the Hong Kong Monetary Authority (HKMA) issued an updated joint circular on intermediaries’ virtual asset-related activities (Joint Circular) with appendices. This Joint Circular supersedes the previous joint circular of 28 January 2022. When the SFC formulated its regulatory approach to virtual assets (VAs) … Continue Reading