Evidence sought on identifying areas to improve ESAs' effectiveness
European Commission has published a consultation paper on the operations of the European Supervisory Authorities (ESAs) (that is, ESMA, EIOPA and the EBA). The consultation focuses on issues relating to the tasks and powers of the ESAs, grouped under the following headings:
- Optimising existing tasks and powers.
- New powers for specific prudential tasks.
- Direct supervisory powers in capital markets.
The Commission also seeks views on the following topics:
- Governance of the ESAs.
- Adaptions to the supervisory architecture.
- Funding of the ESAs.
The deadline for responses is 16 May 2017. The Commission states that the outcome of the consultation may lead to further legislation, if required. EC, 21 March 2017
UK government responds to House of Lords EU Committee report on Brexit and financial services
UK government published its response to the House of Lords EU Sub-Committee on Financial Affairs report on Brexit and financial services. In the response, the government considers each of the committee's recommendations in turn, repeating information provided in the February 2017 white paper on Brexit. In particular, the government states that it intends to pursue the "freest possible market access" within the UK's future relationship with the EU and to agree a "phased process of implementation" with the aim of avoiding a cliff edge when the UK leaves the EU. The government confirms that HM Treasury will lead on the negotiations relating to financial services, including ongoing business as usual negotiations. It also suggests that it is unclear whether, after the UK's departure from the EU, the European Central Bank (ECB) would be permitted under single market rules to require euro-denominated instruments to be cleared inside the Eurozone. UK government, 21 March 2017 BoE Governor speech on law, ethics and culture in banking
BoE has published a speech by Mark Carney, BoE Governor, in which he reviews the main elements of the BoE's work to lift ethical standards in the financial industry, concentrating on how codes of conduct and the senior manager's regime (SMR) can improve culture. BoE, 21 March 2017 Member States mostly compliant with ESRB recommendation on funding of credit institutions
The European Systemic Risk Board (ESRB) has issued a summary compliance report on the ESRB recommendation on funding of credit institutions published in December 2012 (the 2012 recommendation). The report grades compliance by the 28 Member States: 22 (including the UK) were graded fully compliant, the remainder were graded largely compliant. ESRB, 21 March 2017 JMLSG proposes revisions to Part I of its guidance
The Joint Money Laundering Steering Group (JMLSG) has published proposed revisions to Part I of its guidance on the prevention of money laundering and the financing of terrorism for the UK financial services industry. The revisions are set out in the following marked-up versions (all dated 14 March 2017):
- Chapters 1-3 (Senior management responsibility and governance, Internal controls and Nominated officer/money laundering reporting officer (MLRO)).
- Chapter 4 (Risk-based approach).
- Chapter 5 (Customer due diligence).
- Chapters 6-8 (Suspicious activities, reporting and data protection, Staff awareness, training and alertness and Record-keeping).
The JMLSG has also published a draft version of the guidance taking into account the changes above. A webpage on the consultation paper states that the proposed revisions. The consultation closes on 28 April 2017. JMLSG, 21 March 2017 Views sought on upcoming image clearing system for cheques
The Cheque and Credit Clearing Company (C&CCC) has launched a consultation with interested parties on key documents relating to the image clearing system (ICS) which will launch later in 2017. The ICS will use image processing to speed up the clearing of cheques and other paper instruments such as bankers' drafts, postal orders, government payable orders, warrants, travellers' cheques and bank giro credits. The consultation closes on 28 April 2017. C&CCC, 21 March 2017 Nick Stace appointed FCA non-executive director
HM Treasury has appointed Nick Stace as a non-executive director of the FCA for an initial term of three years, commencing 1 April 2017. Mr Stace is the chief executive and secretary of the Royal College of Veterinary Surgeons. FCA, 21 March 2017
INVESTMENTS AND FUNDS
FCA reconfirms IBA LIBOR code of conduct industry guidance status: March 2017
FCA has updated its confirmed industry guidance webpage to extend the confirmed industry guidance status for the London Interbank Offered Rate (LIBOR) code of conduct for contributing banks, which was adopted by ICE Benchmark Administration (IBA), is confirmed for a period of 3 years from 17 March 2017, or, if earlier, until such time as the code of conduct needs to be amended in accordance with the Benchmarks Regulation. IBA is the current LIBOR administrator. FCA, 21 March 2017 Corrigenda to MiFID II and MiFIR RTS
European Commission has issued corrigenda to five Commission Delegated Regulations supplementing the MiFID II and the Markets in Financial Instruments Regulation (MiFIR). The corrected Commission Delegated Regulations are:
- Commission Delegated Regulation of 19 July 2016 supplementing MiFID II with regard to regulatory technical standards (RTS) specifying the organisational requirements of investment firms engaged in algorithmic trading.
- Commission Delegated Regulation of 13 June 2016 supplementing MiFID II with regard to RTS specifying the requirements on market making agreements and schemes.
- Commission Delegated Regulation of 13 June 2016 supplementing MiFIR with regard to RTS on the direct, substantial and foreseeable effect of derivative contracts within the EU and the prevention of the evasion of rules and obligations.
- Commission Delegated Regulation of 8 June 2016 supplementing MiFID II with regard to RTS for the annual publication by investment firms of information on the identity of execution venues and on the quality of execution.
- Commission Delegated Regulation of 7 June 2016 supplementing MiFID II with regard to RTS for the level of accuracy of business clocks. EC, 21 March 2017