Welcome to the UK Regulation Round Up, a regular bulletin highlighting the latest developments in UK and EU financial services regulation.
Key developments in October 2023:
31 October
Fund Tokenisation: The Financial Conduct Authority (“FCA”) published a press release announcing that it has joined the Monetary Authority of Singapore’s Project Guardian, a collaborative initiative with the financial industry that explores fund and asset tokenisation use cases and decentralised finance.
Capital Requirements: The Prudential Regulation Authority (“PRA”) published a discussion paper (DP3/23) on capital requirements relating to securitisations.
Cryptoassets: The Committee on Payments and Market Infrastructures (“CPMI”) published a report on considerations for the use of stablecoin arrangements in cross‑border payments.
Cryptoassets: HM Treasury published a response to its consultation paper on managing the failure of systemic digital settlement asset (including stablecoin) firms.
Market Abuse: The FCA published issue 75 of its Market Watch newsletter, which sets out its observations on market soundings and minimising the risk of insider dealing and unlawful disclosure.
30 October
Cryptoassets: HM Treasury published a response to its consultation paper and call for evidence on the UK regulatory approach to cryptoassets.
Cryptoassets: HM Treasury published an update on its plans for the regulation of fiat‑backed stablecoins.
27 October
FCA Handbook: The FCA published Handbook Notice 113, which sets out changes to the FCA Handbook.
MiFID II / MiFIR: The European Securities and Markets Authority (“ESMA”) published an updated version of its Q&As on transparency topics under the Markets in Financial Instruments Directive (2014/65/EU) (“MiFID II”) and the Markets in Financial Instruments Regulation (600/2014) (“MiFIR”).
26 October
ECCTA: The Economic Crime and Corporate Transparency Act (“ECCTA”) received Royal Assent. Please refer to our dedicated article on this topic here.
FCA Regulation Round-up: The FCA published its regulation round-up for October 2023.
AI: The PRA and FCA published a feedback statement (PRA FS2/23 / FCA FS23/6) on the use of artificial intelligence (“AI”) and machine learning in financial services, following their October 2022 discussion paper (PRA DP5/22 / FCA DP 22/4) on this topic.
25 October
Edinburgh Reforms: HM Treasury published a letter from Jeremy Hunt, Chancellor of the Exchequer, to Harriet Baldwin, Chair of the House of Commons Treasury Committee, providing a breakdown of progress in implementation of the Edinburgh Reforms.
ESG: ESMA published a report (ESMA32-992851010-1098) on a fact‑finding exercise it has conducted on corporate reporting practices under the Taxonomy Regulation ((EU) 2020/852).
ESG: ESMA published a report on disclosures of climate‑related matters in financial statements (ESMA32-1283113657-1041).
Cryptoassets: The FCA published a statement warning about common issues with cryptoasset marketing.
24 October
UK / EU Collaboration: HM Treasury published a policy paper setting out a joint statement with the European Commission on the first EU-UK Financial Regulatory Forum, which was held on 19 October 2023.
Bonus Cap: The PRA and the FCA jointly published a policy statement (PS9/23 / PS23/15) on the ratio between fixed and variable components of total remuneration (i.e. the “Bonus Cap“).
Systemic Importance: The PRA published a policy statement (PS13/23) on updating binding technical standards in the on shored version of Commission Delegated Regulation (EU) No 1222/2014 on the methodology for identifying global systemically important institutions (“G-SIIs”).
20 October
ESG: Two Commission Notices under the EU Taxonomy Regulation ((EU) 2020/852) and the EU Taxonomy Climate Delegated Act ((EU) 2021/2139) have been published in the Official Journal of the European Union (here and here).
Cryptoassets: The European Banking Authority (“EBA”) and ESMA published a joint consultation paper on two sets of guidelines on suitability assessments of the management body and holders of qualifying holdings under the Regulation on markets in cryptoassets ((EU) 2023/1114) (“MiCA”).
19 October
Cryptoassets Regulation: The EBA launched consultations (here, here, and here) on regulatory technical standards (“RTS”) and guidelines under MICA.
Securitisation: European Commission delegated regulation (EU) 2023/2175 supplementing the EU Securitisation Regulation ((EU) 2017/2402) with regard to RTS specifying in greater detail the risk retention requirements for originators, sponsors, original lenders and servicers has been published in the Official Journal of the European Union.
MiFID II / MiFIR: The Council of the EU published final compromise texts (here and here) for proposed amendments to MiFIR and MiFID II that reflect the provisional political agreement that was reached with the European Parliament in June 2023.
EBA Priorities: The EBA published its Supervisory Examination Programme for 2024 (EBA/REP/2023/35).
17 October
Cryptoassets: The Basel Committee on Banking Supervision published a consultation (BCBS556) on banks’ disclosure of cryptoasset exposures.
European Commission Priorities: The European Commission published its Work Programme for 2024 (COM(2023) 638 final).
International Competitiveness: The FCA published a speech given by Nikhil Rathi, FCA Chief Executive, in which he focused on the FCA’s new secondary objective to support international competitiveness and growth over the medium to long term.
13 October
MiFID II / MiFIR: ESMA published an updated version of its Q&As on market structures under the MiFID II and the MiFIR.
ESG: The Financial Stability Board (“FSB”) published its 2023 progress report on climate‑related disclosures.
12 October
ESG: The EBA published a report on the role of environmental and social risks in the prudential framework (EBA/REP/2023/34).
TCFD: The Task Force on Climate‑related Financial Disclosures (“TCFD”) published its sixth and final status report.
Asset Management Regulation: The FCA published a speech by Ashley Alder, FCA Chair, on its priorities for updating and improving the UK regime for asset managers.
11 October
EURIBOR: The European Money Markets Institute published a consultation paper on proposed changes to the hybrid methodology for EURIBOR.
Financial Stability: The FSB published its 2023 annual report on promoting global financial stability.
10 October
ESG: The European Parliament’s Economic and Monetary Affairs Committee published a draft report on the European Commission’s legislative proposal for a Regulation on the transparency and integrity of ESG rating activities.
Market-Based Finance: The Bank of England published a Financial Stability in Focus publication setting out the approach of the Financial Policy Committee (“FPC”) to assessing risks in market‑based finance and the ways it intends to develop this approach.
Financial Policy Committee: The Bank of England published the financial policy summary and record of the meetings of its FPC on 26 September and 5 October 2023.
09 October
ESG: The UK Transition Plan Taskforce published its final disclosure framework for climate transition plans and accompanying implementation guidance. Please refer to our dedicated article on this topic here.
Payments: The FSB published a consolidated progress report for 2023 on the G20 roadmap for enhancing cross‑border payments, together with a key performance indicators monitoring report.
06 October
AI: The FCA published a speech by Jessica Rusu, FCA Chief Data, Information and Intelligence Officer on AI in financial services.
05 October
Securities Settlement: ESMA published a call for evidence on the potential impact of shortening the securities settlement cycle.
Cryptoassets: ESMA launched a consultation on its second set of RTS and implementing technical standards (“ITS”) under MICA
ESG: The Green Technical Advisory Group published a report on creating an institutional home for the UK green taxonomy.
PRIIPS: The European Parliament’s Economic and Monetary Affairs Committee published a draft report (PE753.665v01-00) on the European Commission’s legislative proposal for amendments to the Regulation on key information documents for packaged retail and insurance‑based investment products (1286/2014) (“PRIIPs Regulation”).
Retail Investment Protection: The European Parliament’s Economic and Monetary Affairs Committee published a draft report (PE753.711v01-00) on the European Commission’s legislative proposal for a Directive on retail investment protection (2023/0167(COD)).
03 October
ESG / MiFID II: ESMA announced that in 2024, it will launch and carry out a common supervisory action with national competent authorities on the integration of sustainability in firms’ suitability assessment and product governance processes and procedures under MiFID II.
02 October
ESG: ESMA published a trends, risks and vulnerabilities risk analysis report (ESMA50-524821-2931) on ESG names and claims in the EU funds industry.
AI: The International Regulatory Strategy Group (“IRSG”) published its response to the AI white paper that was published by the Department for Science, Innovation and Technology, and Office for Artificial Intelligence in March 2023.
UK / US Collaboration: HM Treasury published a joint statement by the UK-US Financial Regulatory Working Group following its eighth meeting, which took place on 6 September 2023.
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