Welcome to the UK Regulation Round Up, a regular bulletin highlighting the latest developments in UK and EU financial services regulation.

Key developments in November 2023:

30 November

Costs and Charges Disclosure: The Financial Conduct Authority (“FCA”) published a statement in response to concerns about costs and charges disclosure in the PRIIPs key information document, the UCITS key investor information document and MiFID II requirements.

FCA Regulation Round‑up: The FCA published its regulation round‑up for November 2023.

29 November

ESG: The House of Commons’ Environmental Audit Committee published its report on the financial sector and UK’s net zero transition.

CRR: The European Banking Authority (“EBA”) published a consultation paper (EBA/CP/2023/36) on draft regulatory technical standards (“RTS”) on the conditions for assessing the materiality of extensions and changes to the use of alternative internal models and changes to the subset of the modellable risk factors under Article 325az(8) of the Capital Requirements Regulation (575/2013) (“CRR”), as amended by the CRR II Regulation ((EU) 2019/876).

OTC Derivatives: The European Commission published a consultation on replacing the public identifier of over‑the‑counter derivatives in the EU.

ESG: The Basel Committee on Banking Supervision (“BCBS”) published a consultative document (BCBS560) on the disclosure of climate‑related financial risks.

Capital Requirements: The FCA published a consultation paper (CP23/24) on capital deduction for redress requirements for personal investment firms.

Securitisation: HM Treasury published a draft of the Securitisation Regulations 2023.

28 November

ESG: The FCA published a consultation (GC23/3) on proposed guidance relating to its new anti‑greenwashing rule.

EMIR: The European Commission adopted a Delegated Regulation amending the RTS laid down in Delegated Regulation (EU) 153/2013 relating to temporary emergency measures on collateral requirements under European Market Infrastructure Regulation (648/2012) (“EMIR”).

CCPs: The European Parliament’s Economic and Monetary Affairs Committee (“ECON”) published a press release announcing that it has adopted its draft reports on the European Commission’s legislative proposals for a proposed Directive and Regulation on the treatment of concentration risk towards central counterparties (“CCPs”) and the counterparty risk on centrally cleared derivative transactions (2022/0404(COD)).

IFPR: The FCA published its IFPR newsletter for November 2023, which sets out its expectations on the implementation of the Investment Firms Prudential Regime (“IFPR”), as set out in the Prudential sourcebook for MiFID Investment Firms (“MIFIDPRU”).

ESG: The FCA published a policy statement (PS23/16) on Sustainability Disclosure Requirements (“SDR”) and investment labels. Please refer to our dedicated article on this topic here.

UK Prospectus Regime: A draft of the Public Offers and Admissions to Trading Regulations 2023 (“POAT”) was published, along with a draft explanatory memorandum. The POAT will replace retained EU law relating to the prospectus regime and create a UK framework for public offers and admissions to trading.

Cryptoassets: The Financial Stability Board published a report on the financial stability implications of multifunction cryptoasset intermediaries.

27 November

ESG: The European Securities and Markets Authority (“ESMA”) published a speech given by Verena Ross, ESMA Chair, at the European Fund and Asset Management Association investment management forum.

ESAP: The Council of the EU announced that it has formally adopted the proposed European Single Access Point (“ESAP”) Regulation, along with the ESAP Omnibus Regulation and ESAP Omnibus Directive which amend existing EU legislation in financial services, capital markets and sustainability to enable the functioning of ESAP – a single point of access to public financial and non‑financial information about EU companies and EU investment products.

Short Selling: The Short Selling (Notification Threshold) Regulations 2023 (SI 2023/1258) were published, with an accompanying explanatory memorandum and an impact assessment.

Financial Regulatory Forum: HM Treasury published a statement following discussions held between the UK and Japan at the Financial Dialogue and Financial Regulatory Forum held in Tokyo on 27 November 2023.

Bank of England Independence: The House of Lords Economic Affairs Committee published a report (HL Paper 10) following its inquiry into the independence of the Bank of England.

IFPR: The FCA published a webpage setting out its final report on its multi‑firm review into firms’ progress in implementing the internal capital adequacy and risk assessment (“ICARA”) process and reporting requirements under the IFPR. Please refer to our dedicated article on this topic here.

24 November

Fund Tokenisation: The Investment Association (“IA”) published an interim report on UK fund tokenisation, written by the technology working group of HM Treasury’s asset management taskforce.

Change of Control: The PRA published a joint PRA‑FCA consultation paper (PRA CP25/23 / FCA CP23/23) on prudential assessment of acquisitions and increases in control. The FCA has also published a webpage on the consultation.

Financial Market Infrastructure: The FCA published a statement on a review of the operation of its memorandum of understanding with the Bank of England for financial market infrastructure (“FMI”).

23 November

AI: UK Finance published a report on the impact of artificial intelligence (“AI”) in financial services.

Alternative Investment Fund Designation Bill: The Alternative Investment Fund Designation Bill 2023‑24 has been introduced to Parliament and has had its first reading in the House of Lords. The text of the Bill, as introduced to the House of Lords, has also been published.

22 November

Autumn Statement: The Chancellor, Jeremy Hunt, delivered the 2023 Autumn Statement.

Short Selling: HM Treasury published a draft version of the Short Selling Regulations 2024, alongside a policy note.

Digital Securities Sandbox: HM Treasury published a formal response to its consultation on proposals for its first FMI sandbox, referred to as the Digital Securities Sandbox.

Financial Policy Committee: HM Treasury published a letter from Jeremy Hunt, Chancellor of the Exchequer, to Andrew Bailey, Bank of England Governor, setting out the remit, recommendations and priorities for the Financial Policy Committee for 2023/24.

ESG: European Securities and Markets Authorities (“ESMA”) published three explanatory notes covering key aspects of the EU sustainable finance framework (here, here and here). Please refer to our dedicated article on this topic here.

ESG: The BCBS published a newsletter on the implementation of its principles for the effective management and supervision of climate‑related financial risks.

20 November

Sanctions: The Foreign and Commonwealth Development Office and the Office of Financial Sanctions Implementation published guidance on when public bodies and private businesses are deemed to be controlled by a sanctioned person.

17 November

Cryptoassets: ESMA published a speech by Verena Ross, ESMA Chair, on the implementation of the Markets in Cryptoassets Regulation ((EU) 2023/1114) (“MiCA”).

16 November

DEI: The IA published a report on equity, diversity and inclusion data in the UK investment management industry.

Corporate Transparency: The Economic Crime and Corporate Transparency Act 2023 (Commencement No. 1) Regulations 2023 (SI 2023/1206) have been published.

Cryptoassets: The International Organization of Securities Commissions published a final report (FR11/2023) setting out its policy recommendations for crypto and digital asset markets.

ESG: The FCA published the findings of its multi‑firm review of how authorised fund managers comply with existing regulatory requirements and expectations on the design, delivery and disclosure of ESG and sustainable investment funds.

15 November

Costs and Charges Disclosure: The House of Commons Treasury Sub‑Committee on Financial Services Regulations published a letter from Harriet Baldwin, Chair, to Jeremy Hunt, Chancellor of the Exchequer, about investment companies and cost disclosures.

Regulatory Oversight: The House of Lords Liaison Committee published its sixth report of the 2022‑23 session, in which it recommends the creation of a new House of Lords Financial Services Regulation Committee.

13 November

UK EMIR: The Central Counterparties (Equivalence) (Singapore) (Monetary Authority of Singapore) Regulations 2023 (SI 2023/1198) have been published on legislation.gov.uk. The Regulations relate to the equivalence regime under UK EMIR (648/2012).

ESG: The UK Transition Plan Taskforce published a consultation on seven sector deep dives guidance. Please refer to our dedicated article on this topic here.

10 November

CSDR: The European Parliament published the provisional edition of the text of the legislative resolution adopted by it at first reading on the proposed Regulation amending the Central Securities Depositories Regulation (909/2014) (“CSDR”).

AIFMD II: The Council of the EU published the final compromise text for the proposed Directive amending the Alternative Investment Fund Managers Directive (2011/61/EU) (“AIFMD”) and the UCITS Directive (2009/65/EC) relating to delegation arrangements, liquidity risk management, supervisory reporting, provision of depositary and custody services, and loan origination by alternative investment funds.

08 November

Securitisation: The European Commission adopted RTS (C(2023) 7418 final) amending the RTS laid down in Delegated Regulation (EU) 2019/1851 as regards to the homogeneity of the underlying exposures in simple, transparent and standardised securitisations.

Cryptoassets: The European Commission sought feedback on four draft delegated acts to be adopted under MICA. The delegated acts specify certain criteria for classifying asset‑referenced tokens and e‑money tokens as significant, product intervention powers, supervisory fines, and fees. The EBA also launched consultations on RTS, ITS and guidelines under MICA.

07 November

Financial Promotions: A draft version of the Financial Services and Markets Act 2000 (Financial Promotion) (Amendment) (No 2) Order 2023 has been published, together with an explanatory memorandum.

Financial Promotions: HM Treasury has also published a response to its consultation paper on the financial promotion exemptions for high net worth individuals, sophisticated investors and self‑certified sophisticated investors set out in articles 48, 50 and 50A of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005 (SI 2005/1529).

06 November

Cryptoassets: The Bank of England published a discussion paper on the proposed regulatory regime for systemic payment systems using stablecoins and related service providers. This was published alongside the FCA’s discussion paper (DP23/4) on its proposed approach to regulating fiat‑backed stablecoins that may be used for payments.

02 November

Cryptoassets: The FCA published finalised non‑handbook guidance (FG23/3) providing information on, and setting out the FCA’s expectations of, the communication and approval of financial promotions relating to qualifying cryptoassets.

01 November

Consumer Duty: The FCA published a speech given by Nisha Arora, FCA Director of Cross Cutting Policy and Strategy, on the consumer duty and what comes next for firms. It has also published two new webpages relating to the implementation of the duty (here and here).

AI: The International Regulatory Strategy Group published a policy paper on a coherent and interoperable international regulatory framework on AI.

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Photo of John Verwey John Verwey

John Verwey is a partner in the Private Funds Group. John advises on a wide number of regulatory issues at a national UK and European level, including firm authorisations, appointed representative arrangements, change in control, market abuse. He represents a variety of clients…

John Verwey is a partner in the Private Funds Group. John advises on a wide number of regulatory issues at a national UK and European level, including firm authorisations, appointed representative arrangements, change in control, market abuse. He represents a variety of clients that range from small start-up fund managers to established global fund advisers and managers.

A particular area of focus for John is Alternative Investment Fund Managers Directive (AIFMD) and Markets in Financial Instruments Directive II (MiFID II).  This includes advising on pre-marketing and marketing strategies for fund managers, advising on the Level One and Lever Two requirements under AIFMD and implementing UK rules and legislation, and advising on the organizational and conduct of business requirements under MiFID II.

Photo of Andrew Wingfield Andrew Wingfield

Andrew Wingfield is a partner in the Corporate Department and a member of our Private Equity Mergers & Acquisitions Group. As businesses globally are impacted by the Coronavirus (COVID-19) pandemic, Andrew is a member of the firm’s Coronavirus Response Team helping clients respond…

Andrew Wingfield is a partner in the Corporate Department and a member of our Private Equity Mergers & Acquisitions Group. As businesses globally are impacted by the Coronavirus (COVID-19) pandemic, Andrew is a member of the firm’s Coronavirus Response Team helping clients respond and solve issues across myriad fronts.

Andrew undertakes a broad range of domestic and cross-border corporate and commercial work for both corporate and private equity clients, advising on acquisitions and disposals, joint ventures, mergers and public takeovers, flotations and equity capital markets and private equity investment.

He is called upon by financial institutions, private equity houses, management and corporates to lead on complex and high-value transactions. Andrew has a very strong financial institutions practice and has been recognized by Chambers UK and Legal 500 in recent years as the “go-to regulatory M&A lawyer” for regulated institutions such as banks, lenders, payment providers, insurance companies, wealth managers or other financial institutions transactions.

In addition, Andrew is widely recognized as a leading M&A and private equity lawyer. In Chambers UK, Andrew has been noted as “dynamic and commercial” and for providing “tailored, practical advice.” A client told Legal 500, “Andrew Wingfield – best lawyer I ever worked with. Super helpful, goes extra mile where needed.”

Photo of Richard Bull Richard Bull

Richard Bull is a partner in the Corporate Department and a member of our Private Equity and Mergers & Acquisitions Groups.

Richard advises on a wide range of corporate work, including M&A, private investments, corporate venturing, joint ventures and corporate restructurings. Richard has…

Richard Bull is a partner in the Corporate Department and a member of our Private Equity and Mergers & Acquisitions Groups.

Richard advises on a wide range of corporate work, including M&A, private investments, corporate venturing, joint ventures and corporate restructurings. Richard has extensive experience of acting on private equity, growth and expansion capital transactions of all types and sizes for sponsors and management teams, both of a domestic and international nature, with a particular focus in the financial services and technology industries.

Richard is described by Legal 500 “as one of the most capable PE lawyers in the market” and “truly excellent.” Richard was also identified by a survey of private equity sponsors undertaken by The Lawyer as one of the top private equity lawyers based in London, and as a highly regarded private equity and M&A lawyer by IFLR 1000.

Photo of Oliver R. Howley Oliver R. Howley

Oliver Howley is a partner in Proskauer’s Technology, Media & Telecommunications Group. He is a trusted advisor to businesses in the technology, manufacturing, sports and financial services sectors, providing valued input on IP, technology and data-related strategies and transactions.

Oliver is a multi-specialist…

Oliver Howley is a partner in Proskauer’s Technology, Media & Telecommunications Group. He is a trusted advisor to businesses in the technology, manufacturing, sports and financial services sectors, providing valued input on IP, technology and data-related strategies and transactions.

Oliver is a multi-specialist, with a day-to-day practice covering commercial contracts, IP, technology and data protection work. He regularly advises on the structuring and terms of contracts relating to the creation, licensing and monetisation of technology and data products, with a particular focus on machine learning and artificial intelligence systems. He also has extensive experience in advising on the IP, technology, data and carve-out aspects of corporate transactions (including joint ventures, acquisitions, disposals and investments) and on sponsorship, image rights and endorsement deals in the sports sector.

Oliver has been recognized as a “Rising Star” in The Legal 500 for consecutive years. Recent professional directories note that “no matter how complex the landscape, no detail escapes [Oliver’s] attention” and that his “logical… and forensic analytical approach make him a force to be reckoned with”. He also receives praise for his commercial contracts work and “niche in robotics and artificial intelligence”.

Photo of Mary Wilks Mary Wilks

Mary Wilks is an antitrust partner in the Corporate Department and a member of our Private Equity Transactions and Mergers & Acquisitions Groups.

Mary advises on a broad range of EU and UK competition law issues, including multijurisdictional mergers, behavioral investigations, complex supply…

Mary Wilks is an antitrust partner in the Corporate Department and a member of our Private Equity Transactions and Mergers & Acquisitions Groups.

Mary advises on a broad range of EU and UK competition law issues, including multijurisdictional mergers, behavioral investigations, complex supply and distribution arrangements, and foreign investment controls including, notably, the UK’s newly adopted National Security and Investment Act. She advises clients on the competition aspects of transactions including M&A, equity investments, consortium transactions and secondaries.

Mary works across all sectors, with particular experience in consumer products, healthcare, TMT and financial services.

Mary regularly counsels clients on their engagement with the Competition and Markets Authority, the European Commission, and other prominent international enforcement agencies and regulatory authorities.

Mary Wilks has a reputation as an “excellent lawyer” who “plays a leading role on a range of high-profile cases.” According to sources, “She is always fully on top of the detail but also able to pull out the most important points for the case.

Prior to joining Proskauer, Mary was a counsel in the antitrust, competition and trade department at another leading law firm in London.

Photo of Rachel Lowe Rachel Lowe

Rachel E. Lowe is a special regulatory counsel in the Corporate Department and a member of the Private Investment Funds Group.

Rachel advises on financial services regulation specializing in sustainable finance and ESG regulation. She has particular expertise in drafting and advising on…

Rachel E. Lowe is a special regulatory counsel in the Corporate Department and a member of the Private Investment Funds Group.

Rachel advises on financial services regulation specializing in sustainable finance and ESG regulation. She has particular expertise in drafting and advising on the Sustainable Finance Disclosure Regulation (SFDR) and the Taxonomy Regulation. Rachel has also supported with EU MiFID and AIFMD sustainability updates for clients, including from a governance and organizational perspective, as well as providing drafting and training support. She also advises on the Corporate Sustainability Reporting Directive (CSRD), including analysis of its applicability for large international group structures.

From a UK perspective, Rachel supports clients with the TCFD-related requirements in the Financial Conduct Authority’s ESG Sourcebook and is increasingly engaged on the UK’s Sustainability Disclosure Requirements (SDR).

More broadly, Rachel has worked with litigation colleagues to assist clients with understanding and mitigating greenwashing-related legal and regulatory risk.

Photo of Amar Unadkat Amar Unadkat

Amar Unadkat is a special regulatory counsel in the Corporate Department and a member of the Private Funds Group.

Amar advises on a variety of financial services regulatory and compliance matters both from a UK and European perspective. Amar regularly advises his clients…

Amar Unadkat is a special regulatory counsel in the Corporate Department and a member of the Private Funds Group.

Amar advises on a variety of financial services regulatory and compliance matters both from a UK and European perspective. Amar regularly advises his clients on issues relating to the Alternative Investment Fund Managers Directive (“AIFMD”), the second Markets in Financial Instruments Directive (“MiFID II”), as well as the latest ESG developments. Amar also focusses on UK regulatory compliance matters, including the FCA’s change of control regime, the appointed representative regime and the Senior Managers & Certification Regime.

Amar’s clients include private equity firms, investment managers and advisers, firms in the FinTech space, wealth management businesses, banks and sovereign wealth funds.

Photo of Sulaiman Malik Sulaiman Malik

Sulaiman Malik is an associate in the Corporate Department and a member of the Private Funds Group.

Sulaiman advises clients on a range of UK and international financial regulation. He advises private equity funds, hedge funds, sovereign wealth funds and other asset managers…

Sulaiman Malik is an associate in the Corporate Department and a member of the Private Funds Group.

Sulaiman advises clients on a range of UK and international financial regulation. He advises private equity funds, hedge funds, sovereign wealth funds and other asset managers, as well as banks, FinTechs, broker-dealers and governments.

Prior to joining Proskauer, Sulaiman trained at Simmons & Simmons in London, where he was seconded to Brevan Howard. He has also spent time at the UK’s Ministry of Justice and as an adviser to the Mayor of Brisbane, in Australia.

Sulaiman is a passionate advocate for diversity and inclusion. He previously worked at Rare, a market-leading diversity consultancy, and provides pro bono legal advice to a range of community and civil rights organizations.

Photo of Michael Singh Michael Singh

Michael is an associate in the Private Funds Group in the Corporate Department.

Michael advises clients on a variety of regulatory issues both from a UK and European perspective. He also helps clients on fund related transactions. His clients include private equity firms…

Michael is an associate in the Private Funds Group in the Corporate Department.

Michael advises clients on a variety of regulatory issues both from a UK and European perspective. He also helps clients on fund related transactions. His clients include private equity firms, investment managers, FinTech companies and wealth management businesses.

He is dual-qualified as a German lawyer (“Rechtsanwalt”) and Solicitor of England and Wales and previously was in-house counsel at Deutsche Bank.