Domestic

Irish Practice Developments: December 2019

CBI Supervisory Priorities for 2020

Michael Hodson, CBI Director of Asset Management and Investment Banking delivered a speech in which he identified CBI supervisory priorities for 2020.

CBI consultation CP130 on Treatment, Correction and Redress of Errors in Investment Funds closed

Feedback responses to the CBI's CP130 consultation were due by 9 December 2019. The A&L Goodbody Asset Management & Investment Funds team submitted a response by the deadline. The CBI has confirmed that this will be a two-step process with a second Consultation Paper being released in 2020.

CBI Markets update 18 December 2019

The CBI issued its ninth markets update of 2019 on 18 December. The markets update lists and links to all CBI speeches delivered during September, October and November 2019. It also mentions the publication in the Official Journal of the Regulations and Directive on prudential supervision of investment firms. This legislation came into force on 25 December 2019. The markets update also lists and links to ESMA's activities in September through December 2019 and the IOSCO update to peer review of regulation of MMF and securitisation.

European

EU & International Developments: December 2019

ESMA's pan-EU review on the use of supervisory sanctions for UCITS

ESMA issued its second annual report on sanctions (penalties and measures) imposed by national competent authorities (NCAs) under the UCITS Directive.

ESMA Q&A on application of AIFMD

ESMA updated its questions and answers on the application of the AIFMD to clarify how AIFMs should report the results of liquidity stress tests for the closed-ended unleveraged funds that they manage. Closed-ended unleveraged AIFs are exempt from implementing liquidity risk management systems and from conducting stress tests.

ESG

On 9 December 2019, the following regulations were published in the Official Journal of the EU:

Regulation (EU) 2019/2088 on sustainability-related disclosures in the financial services sector (Disclosure Regulation). It lays down harmonised rules for financial market participants (including UCITS ManCos and AIFMs and financial advisers) on transparency with regard to the integration of sustainability risks and the consideration of adverse sustainability impacts in their processes, as well as the provision of sustainability-related information. The Disclosure Regulation enters into force on 29 December 2019. Most of the provisions will apply from 10 March 2021. Article 20(3) sets out some provisions which apply from 29 December 2019 and others which apply from 1 January 2022.

Regulation (EU) 2019/2089 amending the Benchmarks Regulation as regards EU climate transition benchmarks, EU Paris-aligned benchmarks and sustainability-related disclosures for benchmarks (Low Carbon Benchmarks Regulation). It amends the Benchmarks Regulation by introducing a regulatory framework that lays down minimum requirements for EU climate transition benchmarks and EU Paris-aligned benchmarks at the EU level, to ensure that these benchmarks do not significantly harm other environmental, social and governance (ESG) objectives. The Low Carbon Benchmarks Regulation entered into force on 10 December 2019.

European Commission proposal for a regulation on the establishment of a framework to facilitate sustainable investment

On 18 December 2019, EU ambassadors endorsed the political agreement reached by Finland's presidency and the Parliament on the sustainable investment taxonomy (classification) regulation. The next steps are formal adoption by the Council and the Parliament.