BANKING

FCA consults on 2017/18 regulated fee and levy rate proposals

FCA has published a consultation paper on regulated fee and levy rate proposals for 2017/18 (CP17/12). In CP17/12, the FCA sets out the proposed 2017/18 regulatory fees and levies for itself, the Financial Ombudsman Service (FOS), the Money Advice Service (MAS), the Pension Wise service and HM Treasury's illegal money lending expenses. The FCA explains that for 2017/18 its annual funding requirement (AFR) is £526.9 million. This is an increase of £7.6 million (that is, 1.5%) over the AFR for 2016/17. The increase is driven by an inflation-aligned £5.1 million (that is, 1%) increase in the FCA's ongoing regulatory activities (ORA) budget and £2.5 million for EU withdrawal costs. FCA, 18 April 2017

New FCA webpage on "durable medium"

FCA has published the April 2017 edition of its Regulation Round-up. Among other things, the news and publications section of the round-up refers to a new "durable medium" FCA webpage. The webpage (which was last updated on 7 April 2017) aims to clarify the meaning of durable medium, as well as explaining its origin, purpose and interpretation. In relation to the interpretation of durable medium, the FCA suggests that firms may wish to consider relevant EU cases to decide whether a particular system or technology might meet the durable medium criteria. FCA, 18 April 2017

FCA Mission 2017

FCA has published its Mission 2017, together with a feedback statement (FS17/1) outlining the FCA's overall responses to its consultation paper on its future mission. The Mission sets out, at a high-level, the framework for the strategic decisions the FCA makes, the reasoning behind its work, and the way it chooses which tools to use. FCA, 18 April 2017

FCA's 2017/18 business plan

FCA has published its 2017/18 business plan. Areas of focus across the financial services sector for 2017/18 include the following:

  • Firms' culture and governance.
  • Financial crime and anti-money laundering (AML).
  • Promoting competition and innovation.
  • Technological change and resilience.
  • Treatment of existing customers.
  • Consumer vulnerability and access to financial services.

The FCA has also, for the first time, published its sector views for 2017, which highlight the issues and developments the FCA sees in the sectors it regulates. FCA, 18 April 2017

 

INVESTMENTS AND FUNDS

ESMA signs MoU on CCPs with New Zealand regulators under EMIR

ESMA has published a memorandum of understanding (MoU) that it has entered into with the Reserve Bank of New Zealand and the Financial Markets Authority of New Zealand under Article 25 of EMIR. ESMA, 18 April 2017

EMMI adopts governance framework for EONIA

European Money Markets Institute (EMMI) published a press release announcing that it has adopted an overarching governance framework for the Euro Overnight Index Average (EONIA). The EONIA governance framework (dated 12 April 2017) specifies the governance and control framework for EONIA, including the obligations of parties that play a role in its determination. It is in line with regulatory requirements and comprises the following elements:

  • The governance code of conduct (GCC), which sets out the governance arrangements and control framework established by EMMI, the selection of panel banks, and the general specification and approach for the determination of EONIA.
  • The code of obligations of panel banks (COPB), which sets out the requirements for panel banks in acting as contributors of data to EMMI for the determination of EONIA.
  • The code of obligations of calculation agent (COCA), which sets out the requirements for the calculation agent in acting as an agent of EMMI for the determination of EONIA. (A footnote to the press release explains that the COCA is not available. A section on the responsibilities of the calculation agent is included in section 9 of the GCC, which has been drafted reflecting the requirements of the Regulation on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds (Regulation (EU) 2016/1011) (Benchmarks Regulation or BMR) and accordingly does not apply to central banks.)
  • The benchmark determination methodology (BDM), which sets out the determination methodology for the calculation of EONIA under both regular and contingency circumstances.

The EONIA governance framework will enter into force on 1 August 2017. This gives all parties involved a three month implementation period, to enable compliance. EMMI, 13 April 2017