Global Financial Regulatory Blog

Category Archives: Conduct of Business

Subscribe to Conduct of Business RSS Feed

Latham Collaborates on Pioneering Paper for Outsourcing in Financial Services

New resource developed following increased regulatory focus on outsourcing. Latham & Watkins has partnered with the Association for Financial Markets in Europe (AFME) and law firms Matheson and BSP to develop: Outsourcing – Guidance on the Legal and Regulatory Framework, a pioneering resource examining the key European legislation, rules, and guidance for financial services firms … Continue Reading

CJEU Invalidates EU-US Privacy Shield

A ruling by the EU’s top court invalidates the key mechanism for transferring personal data from the EU to the US and imposes additional conditions for use of the standard contractual clauses. By Gail E. Crawford, Fiona M. Maclean, Michael H. Rubin, Ulrich Wuermeling, Calum Docherty, and Amy Smyth On 16 July 2020, the Court of … Continue Reading

ESMA Draft Guidelines on Outsourcing to Cloud Service Providers

The new guidelines reflect the European Commission’s aim to provide additional certainty for regulated entities outsourcing to cloud services. By Rob Moulton, Fiona M. Maclean, Becky Critchley and Anna Lewis-Martinez On 3 June 2020, ESMA published a consultation paper on draft guidelines regarding outsourcing to cloud service providers. The purpose of the proposed guidelines is … Continue Reading

MiFID’s Transparency Rules: ESMA Confirms Equivalence of Numerous Non-EU Venues

Implications for users of third-country trading venues as ESMA confirms the list of venues who meet the criteria in its updated opinions on transparency and position limits. By Rob Moulton and Anna Lewis-Martinez On 3 June 2020, ESMA published updated versions of its opinions on post-trade transparency and position limits for third-country trading venues (TCTVs) … Continue Reading

UK Government Publishes Draft UK-EU Free Trade Agreement With Financial Services Chapter

The government sets out a bold and ambitious arrangement for financial services, including free market access and a new Financial Services Committee. By Rob Moulton and Anna Lewis-Martinez On 19 May 2020, the UK government published draft legal texts of 12 documents, and an accompanying letter, setting out its approach to the UK’s future relationship … Continue Reading

FCA and PSR Support CMA’s Guidance on Business Cooperation Under Competition Law

The CMA recognises that businesses may need to cooperate to ensure supply of essential products and services during the COVID-19 outbreak. By Rob Moulton, David Little, Gregory Bonné, and Anna Lewis-Martinez On 27 March 2020, the FCA and Payment Systems Regulator (PSR) announced their support for the Competition and Markets Authority’s (CMA’s) guidance on its … Continue Reading

FCA and PRA Statement on SM&CR and COVID-19: Expectations of Dual-Regulated Firms

UK Regulators announce new measures after acknowledging firms affected by COVID-19 will need to keep their governance arrangements under review. By Rob Moulton and Anna Lewis-Martinez On 3 April 2020, the FCA and the PRA released a statement announcing several new governance measures for dual-regulated firms amid the COVID-19 outbreak under the Senior Managers and … Continue Reading

COVID-19: PRA Welcomes Suspension of Dividends, Share Buybacks, and Cash Bonuses

Seven of the largest systemically important UK deposit-takers to suspend dividends and share buybacks and to cancel payments of any outstanding 2019 dividends. By Rob Moulton and Anna Lewis-Martinez On 31 March 2020, the PRA published a statement on deposit takers’ approach to dividend payments, share buybacks, and cash bonuses in response to COVID-19. The PRA … Continue Reading

UK Government Temporarily Suspends Wrongful Trading Rules to Assist Company Directors

Proposed changes to UK insolvency laws aim to support companies under pressure due to COVID-19. By Rob Moulton and Anna Lewis-Martinez On 28 March 2020, the UK government announced a number of reforms to UK insolvency laws: The temporary suspension of existing wrongful trading rules retrospectively from 1 March 2020 for three months, so that … Continue Reading

Impact of COVID-19 on French M&A Transactions, French Listed Companies and High Yield Issuers, and French Law Governed Contracts

In three recent Client Alerts, Latham & Watkins lawyers examine how government measures to fight COVID-19 may affect French M&A transactions, key questions for French listed companies and high yield issuers, and how companies can respond to the impact on their current French law contracts. By Latham’s Mergers & Acquisitions, Capital Markets, and Litigation & … Continue Reading

EU Regulators Outline Approach to Remote Working During COVID-19 Crisis

ESMA, BaFin, and FCA have provided guidelines on firms’ obligation to record client telephone calls. By Rob Moulton and Axel Schiemann Remote working raises uncertainties in various regulated areas as it dramatically changes institutions’ day-to-day business. In particular, institutions are confronted with practical and technical difficulties regarding client-related requirements such as the obligation to tape … Continue Reading

FCA Issues Guidance on Key Workers in Financial Services

The FCA has clarified which people working in regulated financial services firms will meet the definition of a “key worker”. By Rob Moulton On 19 March 2020, the UK government published guidance setting out which “key workers” will be permitted special status as regards to educational provision for their children. (It is possible that this … Continue Reading

Bank of England Announces Measures to Address Challenges of COVID-19

The regulator is taking immediate supervisory and policy measures to help support banks, insurers, and financial market infrastructures. By Rob Moulton and Charlotte Collins The Bank of England and the Prudential Regulation Authority (PRA) have announced a number of measures aimed at alleviating operational burdens on PRA-regulated firms, and Bank-regulated financial market infrastructures (FMIs), in … Continue Reading

FCA Sets Out Its Expectations of Firms’ Response to COVID-19

The FCA expects firms to use flexibility to support consumers, has delayed new publications, and extended deadline for responses to published consultations to 1 October 2020. By Rob Moulton, Jonathan Ritson-Candler, and Anna Lewis-Martinez The Financial Conduct Authority (FCA) has published a new webpage providing information on its expectations of firms’ response to the coronavirus. … Continue Reading

Report on IT Failures in the UK Financial Services Sector

UK Treasury Committee report warns that the current level and frequency of disruption and consumer harm is unacceptable. By Carl Simon Fernandes, Nicola Higgs, Fiona M. Maclean, Christian F. McDermott, Rob Moulton, Andrew C. Moyle, Stuart Davis, and Charlotte Collins On 28 October 2019, the Treasury Committee published a report on IT failures in the financial services sector. The … Continue Reading

Trends in Outsourcing Regulation and Supervision in Financial Services

Insights from Latham’s flagship event: Managing the risk and promise of digitisation in financial services Authors: Andrew Moyle, Nicola Higgs, Christian McDermott, and Kirsty Watkins. The financial services industry is leading the way in outsourcing, with contract values in excess of US$10.7 billion in 2018, causing regulators to focus more than ever on the associated … Continue Reading

Regulators Get Tough on Regulatory Outsourcing Failings

Latest FCA and PRA fines against a retail bank show little tolerance for poor outsourcing systems and controls. By Fiona M. Maclean, Christian F. McDermott, Laura Holden, and Charlotte Collins On 29 May 2019, the FCA and PRA announced that they had fined an independent UK bank for failing to manage its outsourcing arrangements properly … Continue Reading

What EBA’s Outsourcing Guidelines Mean for Financial Institutions

The guidelines create new obligations for financial, payment, and electronic money institutions that will impact cloud outsourcing and deployment of FinTech. By Fiona M. Maclean and Laura Holden On 25 February 2019, the European Banking Authority (EBA) published a final report on its draft guidelines on outsourcing arrangements (Guidelines). The report followed the EBA’s publication … Continue Reading

European Banking Authority’s Draft Guidelines on Outsourcing: Discussion of Key Themes

The EBA’s draft guidelines on outsourcing will impact cloud outsourcing and institutions’ deployment of FinTech. By Fiona Maclean, Charlotte Collins, and Terese Saplys On 4 September 2018, a wide audience of interested individuals gathered at Canary Wharf for a public hearing (Public Consultation) to listen to what the European Banking Authority (EBA) had to say in relation … Continue Reading

FCA Speaks Out on the Ethics of Big Data

FCA Chair hints that new regulation addressing data ethics in the FinTech space may be on the horizon. By Nicola Higgs, Fiona Maclean and Terese Saplys Will societies of the future be ruled by algocracy, in which algorithms decide how humans are governed? Charles Randell, Chair of the Financial Conduct Authority (FCA) and Payment Systems … Continue Reading

MiFID II Research Unbundling 6 Months on – what are we seeing in the market?

The FCA has recently announced that it will begin a review of how firms have implemented the unbundling rules “within weeks”. By Beatrice Lo and Jonathan Ritson-Candler At its recent asset management conference, the FCA announced that it will imminently launch a review of how asset managers have implemented the new MiFID II obligation to … Continue Reading

First Use of ESMA Temporary Product Intervention Measures

ESMA to introduce measures to restrict the provision of CFDs, and prohibit the provision of binary options, to retail investors in the EU. By Nicola Higgs and Charlotte Collins The European Securities and Markets Authority (ESMA) has announced the first use of its new product intervention powers under MiFID II. ESMA had announced before MiFID … Continue Reading
LexBlog