Regulation Round Up (March 2021) – Finance and Banking

26 February

HM Treasury published a report setting out the findings
of the Kalifa Review of UK FinTech.

The Financial Conduct Authority
(“FCA“) published Handbook Notice 85, which sets
out changes to the FCA Handbook made by the FCA Board on 25
February 2021.

The Financial Action Task Force
(“FATF“) published a document setting out the
outcomes from its plenary meeting on 22, 24 and 25 February
2021.

The FCA published a report on its review of product
governance in a sample of asset management firms.

The European Securities and Markets Authority
(“ESMA“) issued a press release announcing the
publication of revised version of its Q&As on the EU
Securitisation Regulation.

ESMA published a consultation paper on draft
technical standards under the Regulation on European crowdfunding
service providers for business ((EU) 2020/1503)
(“ECSPR” or “Crowdfunding
Regulation
“) (ESMA/35-36-2201).

The Working Group on Sterling Risk-Free Reference Rates
published a best practice guide for GBP loans.

The Directive amending the MiFID II
Directive (EU/2014/65) (“MiFID II“) to
help the EU’s economic recovery from the COVID-19 pandemic was
published in the Official Journal of the EU

25 February

The International Organization of Securities Commissions
(“IOSCO“) published a press release reporting on
progress made by the Sustainable Finance Task Force
(“STF“) in its work on securities
issuers’ sustainability disclosures, asset managers’
disclosures, and the role of environmental, social and governance
(“ESG“) data and ratings providers.

The Prudential Regulation Authority
(“PRA“) published a statement clarifying its
approach to European Banking Authority
(“EBA“) guidelines and EU regulatory
technical standards relating to the standardised and internal
ratings based (IRB) approaches to credit risk following the end of
the Brexit transition period.

The PRA published a statement on the definition of
“higher paid material risk taker”.

The European Supervisory Authorities (that is, the EBA, EIOPA
and ESMA) each published a supervisory statement (JC 2021
06) made by the Joint Committee of the ESAs on the application of
the Sustainable Finance Disclosure Regulation ((EU) 2019/2088)
(“SFDR” or “Disclosure
Regulation
“).

ESMA published a consultation paper
(ESMA80-187-807) on draft guidelines under the Benchmarks
Regulation (EU/2016/1011) (“BMR“).

The UK’s Foreign Secretary announced increased sanctions
against 6 Burmese officials under the Burma (Sanctions) (EU Exit)
Regulations 2019. They are all members of the State Administration
Council (SAC) that was established after the military coup on 1
February 2021 to exercise the functions of the state.

24 February

The Financial Stability Board (FSB) published a letter sent by Randal Quarles,
FSB Chair, to the G20 finance ministers and central bank governors
ahead of their meeting on 26 February 2021.

HM Treasury published a consultation paper on an
expanded resolution regime for central counterparties (CCPs).

The EBA published the following consultation papers on technical
standards supplementing the Investment Firms Directive
(EU/2019/2034) (“IFD”):

  • Consultation paper on information exchange
    between competent authorities of home and host member states
    (EBA/CP/2021/04).

  • Consultation paper on colleges of supervisors
    for investment firm groups (EBA/CP/2021/05).


ESMA published its final report (ESMA70-151-3370)
on guidelines to clarify common procedures and methodologies for
the supervisory review and evaluation process
(“SREP“) of central counterparties by
their national competent authorities.

The European Commission published a speech by Mairead McGuinness,
European Commissioner for Financial Services, Financial Stability,
and Capital Markets Union.

ESMA published its annual report (ESMA70-156-3926)
(dated 23 February 2021) on the application of waivers and
deferrals for non-equity instruments under the Markets in Financial
Instruments Regulation (EU/600/2014)
(“MiFIR“).

23 February

The Bank of England (“BoE“) published
a webpage setting out a plan for
transforming data collection from the UK financial sector (the
transformation plan).

The FCA published the memorandum of understanding
that it has entered into with the Equality and Human Rights
Commission (“EHRC“).

The FCA published finalised guidance for firms on
the fair treatment of vulnerable consumers (FG21/1).

ESMA published an introductory statement made by
Steven Maijoor, ESMA Chair, to the European Parliament’s
Economic and Monetary Affairs Committee
(“ECON“) relating to GameStop share
trading and related phenomena (ESMA22-105-1307).

The European Payments Council (“EPC“)
published version 7 of its guidelines (EPC392-08) (dated
11 February 2021) on the appearance of mandates for the Single Euro
Payments Area (“SEPA“) Direct Debit Core
Scheme and the SDD Business-to-Business Scheme.

22 February

The European Central Bank
(“ECB“) published an opinion (CON/2021/4) on the
proposed Regulation on markets in cryptoassets
(2020/0265(COD)).

The EBA published an opinion (EBA/Op/2021/02) on
supervisory actions to ensure the removal of obstacles to account
access under the revised Payment Services Directive ((EU)
2015/2366) (“PSD2“).

19 February

The ECB published the memorandum of understanding it
has entered into with the BoE and the FCA on post-Brexit
supervisory co-operation.

18 February

The FCA published its Regulation round-up for
February 2021.

The CMA reached an infringement decision after
investigating suspected breaches of the Chapter I prohibition and
Article 101 TFEU in the use of certain retail most favoured nation
clauses by a price comparison website in relation to home insurance
products.

17 February

The Business Banking Resolution Service
(“BBRS“) published a press release announcing the
launch of its independent service to help SMEs resolve disputes
with their banks.

The United Nations Environment Programme Finance Initiative
(“UNEP FI“) issued the following three
reports on climate risk management tools for financial
institutions:


ESMA published a decision (dated 27 January
2021) on delegating to the ESMA chair the task of issuing opinions
relating to the submissions to ESMA by national competent
authorities of the position limits they intend to set under Article
57 of MiFID.

The following Delegated Regulations made under EMIR (648/2012)
were published in the Official Journal of the European Union:


16 February

The European Systemic Risk Board
(“ESRB“) published a report on the financial
stability implications of support measures to protect the real
economy from the effects of the COVID-19 pandemic.

The Information Commissioner’s Office has released a letter it wrote to the US
Securities and Exchange Commission
(“SEC“), setting out its views on how
the restrictions on international transfers of data under Chapter V
of the EU General Data Protection Regulation ((EU)
2016/679
) (“GDPR“), apply to UK
based financial services organisations that are subject to
regulation by the SEC.

The PRA published a Dear CFO letter (dated 15
February 2021) on market disclosure about International Financial
Reporting Standard 9 expected credit loss accounting.

The PRA published a letter it has sent to
independent non-executive directors
(“iNEDs“).

The Working Group on Sterling Risk-Free Reference Rates
published a paper aimed at helping market
participants transition non-linear derivatives, structured products
and cash market instruments that reference the GBP LIBOR ISR
(“ICE Swap Rate“).

15 February

The government announced its new UK Centre for
Greening Finance and Investment
(“CGFI“). The CGFI will begin work in
April 2021 and will have physical research hubs in Leeds and
London.

The BoE updated its stress testing webpage and published the
solvency stress test 2021 scenario for banks and building
societies that are not part of concurrent stress testing.

The Council of the EU published a press release announcing it has
adopted the proposed Directive amending MiFID II to help the
EU’s economic recovery from the COVID-19 pandemic.

HM Treasury published a consultation paper on
supporting the wind-down of critical benchmarks.

12 February

The FCA published a guidance consultation on
cancellations and refunds aimed at credit and debit card firms and
insurance providers.

The PRA published a consultation paper (CP5/21) on
the implementation of the Basel standards.

UK Finance published a guide to LIBOR for banks and
lenders.

The European Commission published a consultation paper on a
targeted review of the Settlement Finality Directive
(98/26/EC) (“SFD“).

A draft version of the Recognised
Auction Platforms (Amendment and Miscellaneous Provisions)
Regulations 2021 was published, together with a draft explanatory
memorandum
.

Regulation (EU) 2021/168
amending BMR as regards the exemption of certain third-country
foreign exchange benchmarks and the designation of replacement
benchmarks for certain benchmarks in cessation was published in the
Official Journal of the European Union.

11 February

The Global LEI Foundation published a press release in which it sets
out the issuance and technical infrastructure models for its
verifiable Legal Entity Identifier system.

The FCA published a report setting out the key
findings from its Financial Lives 2020 survey (FLS) and its October
2020 COVID-19 panel survey. It has also updated its dedicated FLS
webpage.

The EBA published a consultation paper
(EBA/CP/2021/02) on draft implementing technical standards with
regard to the format, structure, contents list and annual
publication date of the information to be disclosed by competent
authorities in accordance with Article 57(4) of the IFD.

The European Parliament published a press release announcing it has
adopted the proposed Directive amending MiFID II to help the
EU’s economic recovery from the COVID-19 pandemic.

The Payment Systems Regulator (“PSR“)
published two calls for views on increasing protection for
customers using payment systems: Call for views CP21/3 focuses
on authorised push payment (APP) scams and Call for views CP21/4 focuses
on consumer protection in interbank payments.

The Competition and Markets Authority (CMA) published a template of a summary of
borrowing statement to be used to comply with obligations in the
Payday Lending Market Investigation Order 2015 (the
Order).

10 February

The BoE published a speech, given by Andrew Bailey,
BoE Governor, on an open financial system.

The European Commission published a summary report of its
consultation on a renewed EU sustainable finance strategy.

The Council of the EU published a note (6047/21) from the General
Secretariat to the Delegations with a three-column table to
commence trialogues on the proposed Directive on credit servicers
and credit purchasers (2018/0063A(COD)).

9 February

ESMA published a letter sent jointly by it,
EIOPA and the EBA to the EU co-legislators on proposed regulation
on digital operational resilience.

The Working Group on Sterling Risk-Free Reference Rates
published a consultation on the successor
rate to GBP LIBOR in legacy bonds referencing GBP LIBOR.

The European Commission published for consultation a draft
Delegated Regulation (Ares(2021)1122309) (accessible via a webpage) amending Delegated
Regulations (EU) 1003/2013 and (EU) 2019/360 as regards the annual
supervisory fees charged by ESMA to trade repositories for
2021.

5 February

The FCA published the findings from its multi-firms
review of how firms implement technology change, the impact of
change failures and the practices used to help reduce the impact of
incidents resulting from change management.

The FCA updated its policy development update webpage, which sets out
information on recent and future FCA publications.

The FCA updated its webpage on changes to
regulatory reporting during the COVID-19 pandemic.

The PRA published a statement on COVID-19
regulatory reporting amendments.

The PSR published a consultation paper on the
delivery and regulation of the New Payments Architecture
(CP21/2).

The BoE published the minutes of the first meeting of
the steering committee of the Productive Finance Working Group held
on 26 January 2021.

The FCA published a portfolio letter sent to retail
banks.

4 February

HM Treasury published a consultation paper on issues
arising from the implementation of the Investment Firms Prudential
Regime (“IFPR“) and the final Basel III
standards.

The PRA published a Dear CEO letter from Sam Woods
that provides feedback on an information request regarding
firms’ operational readiness for a zero or negative BoE Bank
Rate.

The European Supervisory Authorities
(“ESAs“) (that is, the EBA, EIOPA and
ESMA) each published an identical press release announcing that
the Joint Committee of ESAs has submitted to the European
Commission the final report (JC 2021 03) on
draft regulatory technical standards on the content, methodologies
and presentation of disclosures under the SFDR.

You can find out more on SFDR in our recent summary as well as in our ESG
podcasts from August 2020 and January 2021.

3 February

The European Supervisory Authorities have published identical
press releases confirming that they have submitted a draft final report which the
European Insurance and Occupational Pensions Authority
(“EIOPA“) has now adopted on regulatory
technical standards amending Commission Delegated Regulation
2017/653 on key information documents
(“KID“) for packaged retail and
insurance-based investment products
(“PRIIPs“) (“PRIIPs KID
Delegated Regulation
“).

HM Treasury published a press release announcing that
the UK has joined the International Platform on Sustainable Finance
(“IPSF“).

The FCA published its approach document on its
approach to international firms.

ESMA published a letter (ESMA34-46-99) it has
sent to the European Commission, highlighting the areas where it
considers improvements could be made to the Regulation on European
long-term investment funds ((EU) 2015/760) (“ELTIF
Regulation
“).

ESMA published an updated version of its Q&As on market structures topics
(ESMA70-872942901-38) under MiFID II and MiFIR.

The Investment Association published a Dear CEO and CFO letter
addressed to companies issuing LIBOR-linked sterling bonds,
encouraging them to actively transition from GBP LIBOR.

HM Treasury published a press release announcing that reciprocal
arrangements between the UK and Switzerland concerning the share
trading obligation have entered into force, following the removal
of restrictions on UK trading venues by the Swiss authorities.

2 February

The Council of the EU published a press release announcing that
it has adopted the proposed Regulation amending BMR to address
benchmark cessation risks and exempt certain third-country FX
benchmarks.

The European Commission published a call for advice to the European
Supervisory Authorities (that is, the EBA, ESMA and EIOPA) for
technical advice on digital finance and related issues.

The European Money Markets Institute
(“EMMI“) published a press release confirming that
it has conducted its first annual review of the hybrid methodology
for EURIBOR.

ESMA published its annual report (ESMA70-156-2401)
(dated 29 January 2021) on the application of waivers and deferrals
for equity and equity-like instruments under MiFIR.

The FCA published an updated webpage on its
supervisory statement on the operation of the transparency regime
under the retained EU law version of the Markets in Financial
Instruments Regulation (600/2014) (“UK
MiFIR
“).

HM Treasury published a press release announcing that
interest free buy-now-pay-later products are to be regulated by the
FCA.

1 February

The UK government submitted a formal request to the Minister
of Trade in New Zealand to start negotiations on the UK’s
accession to the Comprehensive and Progressive Agreement for
Trans-Pacific Partnership.

ESMA published a final report (ESMA34-39-961)
(dated 29 January 2021) on draft implementing technical standards
produced under Articles 5(3), 10(3) and 13(3) the Regulation on the
cross-border distribution of collective investment undertakings
(EU/2019/1156) (“Cross-Border
Regulation
“).

ESMA published a press release announcing the
launch of a common supervisory action with national competent
authorities on the application of product governance rules under
MiFID II.

ESMA published a final report (ESMA81-393-83) on
technical advice to the European Commission on supervisory fees for
benchmark administrators the BMR.

Regulation Round Up (March 2021)

Originally Published by Proskauer, March 2021

The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.



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