Financial markets are continuously influenced by regulatory changes that shape the way businesses operate, manage risks, and ensure compliance. These updates, which occur frequently across the globe, are designed to address emerging challenges and improve the overall stability and transparency of financial systems. Understanding these developments is essential for market participants, as they can impact everything from operational processes to strategic decision-making. This blog provides a comprehensive overview of the latest regulatory changes, highlighting how they could affect financial markets, drive compliance, and influence market behaviours.
Business Line | Country | Regulator | Regulatory Update | Summary |
All | Luxembourg | CSSF | On September 5, 2024, Luxembourg’s financial regulator, the Commission de Surveillance du Secteur Financier (CSSF), issued Circular CSSF 24/861 to amend the earlier Circular CSSF 19/732 (dated December 20, 2019) on anti-money laundering (AML) and counter-terrorist financing (CFT) measures. The key amendment, effective immediately, provides additional clarification on the identification and verification of Ultimate Beneficial Owners (UBOs). Specifically, the amendment replaces point 74 of the earlier circulars, emphasizing that identification of UBOs in structures where legal persons or arrangements exist between the customer and the UBO must be conducted following a risk-based approach. This update is directed at all professionals under CSSF’s AML/CFT supervision, aiming to ensure heightened transparency and compliance in financial dealings. | |
United Kingdom | FCA | Good and Poor Practices in Appointed Representative Oversight | The Financial Conduct Authority (FCA) has published a review outlining the progress of principal firms in implementing the new rules for oversight of appointed representatives (ARs), which took effect in December 2022. The review revealed that while many firms have made efforts to comply, significant gaps remain in areas such as annual reviews, self-assessments, and AR monitoring. The FCA found that 1 in 5 firms had not completed required checks, and some relied on insufficient “tick-box” methods rather than thorough oversight. The report provides examples of both good and poor practices to help firms enhance their AR governance, with a focus on improved documentation, proactive risk management, and robust onboarding processes. | |
United Kingdom | Pay.UK | Pay.UK and Bank of England Publish Joint Response on ISO 20022 Purpose Codes Consultation | Pay.UK and the Bank of England has released a joint response to their Standards Consultation on Purpose Codes for the ISO 20022 messaging standard. Purpose Codes are a critical component of the ISO 20022 dataset, enabling the identification of payment purposes and driving interoperability for retail, wholesale, and cross-border payments. The consultation, which garnered strong support from the industry, led to key outcomes: the refinement of Purpose Codes for UK payments, the introduction of six new codes (including those for property payments and gambling), and the Bank’s decision to mandate the use of Purpose Codes in certain transactions from spring 2024. This move is expected to enhance payment prioritisation, monitoring, and financial crime controls, further strengthening the implementation of ISO 20022 across the UK payment system. | |
Banking | Australia | ASIC | Misconduct reporting guidance for external administrators and controllers | The Australian Securities and Investments Commission (ASIC) released an updated Regulatory Guide 16 (RG 16), which outlines the obligations of external administrators and controllers when reporting alleged misconduct. This update follows the extensive feedback gathered through Consultation Paper 377 (CP 377) earlier this year and addresses key areas such as introducing a dedicated contact point for inquiries, retaining flexibility in lodging multiple reports, and emphasizing professional judgment in reporting processes. The update reflects broader regulatory changes, case law developments, and feedback from Australia’s corporate insolvency inquiry. ASIC aims to support professionals during the transition to these updates and ensure ongoing responsiveness to law reforms and industry input. |
Switzerland | FINMA | The Swiss Financial Market Supervisory Authority (FINMA) launched a public consultation on its new circular concerning consolidated supervision under the Banking Act (BA) and Financial Institutions Act (FinIA). The circular aims to clarify FINMA’s long-established supervisory practices and provide transparency on how it oversees financial groups. It outlines the requirements for the inclusion of group companies in consolidated supervision, focusing on financial sector activities and the existence of economic or legal obligations for support within groups. The consultation runs until November 1, 2024, allowing stakeholders to review and comment on the proposed framework. | ||
Insurance | Australia | APRA | The Australian Prudential Regulation Authority (APRA) launched a consultation on minor updates to its prudential framework for regulated entities. These updates, which focus on technical clarifications without altering core policy settings, target various prudential standards and guides, including capital adequacy for Authorised Deposit-Taking Institutions (ADIs) and Private Health Insurance, remuneration guidelines, and insurance risk management. The proposed changes affect multiple industries, such as general insurance, life insurance, and superannuation. APRA has invited feedback on these updates, with submissions due by October 4, 2024, ahead of final revisions expected later in the year. | |
China | NFRA | The State Financial Supervision and Administration Bureau of China issued the “Statistical System for County-level Institutions of Insurance Companies” to standardize the supervision and statistical processes of these entities. This new system focuses on capturing critical data, such as premium income and compensation expenditure, from county-level insurance institutions to strengthen risk prevention and oversight. Insurance companies are required to submit monthly reports, beginning in October 2024, with data submission deadlines and specific guidelines provided. This regulatory initiative aims to improve the accuracy and completeness of insurance statistics while ensuring compliance with relevant financial supervision practices. | ||
Investment | Australia | APRA | In June and July 2024, the Australian Prudential Regulation Authority (APRA) and the Australian Securities and Investments Commission (ASIC) hosted Superannuation CEO Roundtables to discuss the role of superannuation funds as investors of members’ money. The discussions centred on investment governance, following the introduction of SPS 530 Investment Governance and SPG 530, emphasizing the importance of liquidity management, risk culture, and the internalization of investment functions. CEOs acknowledged regulatory tools, such as the Performance Test and mandatory ESG reporting, as crucial in managing investment risks. APRA and ASIC encouraged funds to strengthen transparency in private market investments, improve valuation practices, and enhance internal risk management frameworks. | |
Belgium | FSMA | Modified Market Rules for Euronext Brussels and Derivatives Markets | The Financial Services and Markets Authority (FSMA) announced the approval of the modified market rules for the regulated markets operated by Euronext NV/SA, specifically Euronext Brussels and the Euronext Brussels Derivative Instruments Market. This approval, granted on June 26, 2024, aligns with Article 34 of the Law of 21 November 2017 on market infrastructures and the Directive 2014/65/EU. The new rules, effective from September 9, 2024, harmonize the regulatory framework governing Euronext’s securities and derivatives markets across multiple jurisdictions, including Belgium, France, Ireland, Italy, the Netherlands, Norway, and Portugal, ensuring a consistent approach to market conduct, listing, and trading. | |
European Union | European Union | EU Commission Updates Settlement Discipline Regulation under CSDR | The European Commission published updated regulatory technical standards under Regulation (EU) 2018/1229, supplementing the Central Securities Depositories Regulation (CSDR). These updates aim to enhance the settlement discipline framework, focusing on reducing settlement fails across the EU financial markets. Key provisions include stricter rules for cash penalties and the introduction of an extended buy-in process for failed settlements. The regulation also outlines enhanced monitoring and reporting requirements for central securities depositories (CSDs) to improve transparency. The updated standards are part of the ongoing efforts to promote market stability and efficiency within the EU | |
Mexico | Banxico | The Bank of Mexico initiated a public consultation on proposed modifications to the Rules for Derivative Operations, originally established by Circular 4/2012. These updates primarily focus on hedge fund investment operations, aligning with recent reforms introduced through the Decree of Amendments to the Securities Market Law and the Investment Funds Law, published in December 2023. The objective of the amendments is to enhance the regulatory framework governing hedge funds’ derivative activities, ensuring market stability, financial system integrity, and the protection of public interests. The consultation is open until October 4, 2024, allowing stakeholders to provide their input through the Bank of Mexico’s official platform. | ||
Mexico | Banxico | Public Consultation on Securities Lending Rules for Hedge Funds | The Bank of Mexico announced a public consultation for proposed changes to the Securities Lending Rules applicable to hedge funds. The modifications aim to strengthen the regulatory framework surrounding securities lending operations by institutions such as credit institutions, brokerage firms, and hedge funds. This update aligns with the December 2023 decree that introduced amendments to the Securities Market Law and the Investment Funds Law, officially recognizing hedge funds as a new category of investment. The public is invited to provide feedback until October 2, 2024, via the Bank of Mexico’s website. | |
Romania | ASF Romania | The Romanian Financial Supervisory Authority (ASF) initiated a public consultation to amend Regulation No. 5/2019, which governs the provision of investment services under Law No. 126/2018 on financial instruments markets. The proposed changes include new requirements for the use of bank accounts and electronic money institutions in contracts with clients, as well as guidelines for promoting investment services through “refer a friend” campaigns, which will be limited to three campaigns per year. The amendments also address identity verification for remote contracts and restrict the use of proxies in such agreements. The ASF mandates that all financial investment services firms comply with the updated regulations within one year of the amendment’s enactment. | ||
Singapore | MAS | Guidance on Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013 | The Monetary Authority of Singapore (MAS) released updated Frequently Asked Questions (FAQs) regarding the Securities and Futures (Reporting of Derivatives Contracts) Regulations 2013. The updates clarify reporting obligations for significant derivatives holders (SDHs), expand details on reportable derivatives contracts, and outline new requirements that will take effect from October 21, 2024. Key changes include updated guidance on reporting lifecycle events, collateral, and margin information, as well as rules for reporting FX swaps. These revisions aim to ensure compliance and promote transparency in derivatives trading, providing clearer instructions for market participants | |
United Kingdom | FCA | Quarterly Consultation CP24/18 on Access to Cash and LTAF Investment | The Financial Conduct Authority (FCA) released its Quarterly Consultation No. 45 (CP24/18), focusing on two major proposals. First, the FCA seeks feedback on a consequential amendment to the definition of ‘firm’ under the Financial Services and Markets Act 2023, aimed at ensuring that designated coordination bodies for cash access services are subject to the same disciplinary measures as firms. This amendment supports the enforcement of the FCA’s new Access to Cash sourcebook. Second, the consultation addresses non-UCITS retail schemes (NURS) and proposes relaxing the restrictions on their ability to invest in Long-Term Asset Funds (LTAFs). The change would allow NURSs to allocate up to 20% of their portfolios to LTAFs, unlocking broader retail access to long-term illiquid assets, such as private equity and real estate, without significant liquidity risk. The consultation is open for feedback until October 11, 2024, with final decisions expected later this year. | |
United Kingdom | FCA | The Financial Conduct Authority (FCA) launched a consultation on draft questions and answers (Q&As) for UK Trade Repositories (TRs) registered under UK EMIR. The consultation focuses on providing guidance to TRs for implementing the new reporting requirements, which will be enforced from September 30, 2024. The Q&As address technical aspects such as report validation, lifecycle events, and reconciliation processes, aiming to ensure consistent derivatives reporting across the UK market. The FCA is seeking feedback from industry participants, with the consultation closing on September 25, 2024. | ||
United Kingdom | GOV.UK | UK Statutory Instruments | Extension for Enterprise Investment Scheme and Venture Capital Trust Relief | The UK Treasury implemented the Finance Act 2024, Section 11 (Extension of Enterprise Investment Scheme (EIS) Relief and Venture Capital Trust (VCT) Relief) Regulations 2024. This regulation extends tax reliefs for investments in EIS and VCT to cover shares issued before April 6, 2035, ensuring that investors in high-risk, innovative businesses can continue to benefit from tax incentives. The extension aims to drive further capital into early-stage companies, supporting their growth and fostering innovation within the UK economy. The Treasury emphasizes that the continuation of these reliefs will maintain a robust pipeline of funding for startups and venture capital projects, further stimulating economic development. This extension follows recommendations made in the Autumn 2023 Finance Bill and is expected to play a key role in sustaining long-term investment in sectors critical to the UK’s growth strategy. | |
United Kingdom | GOV.UK | UK Statutory Instruments | The Financial Services and Markets Act 2023 (Commencement No. 7) Regulations 2024 | The UK Treasury enacted the Financial Services and Markets Act 2023 (Commencement No. 7) Regulations 2024, bringing key provisions of the Financial Services and Markets Act 2023 into effect from November 1, 2024. This regulation marks a significant step in the UK’s post-Brexit regulatory overhaul by revoking various EU-derived laws, including the EU Securitisation Regulation (2017/2402) and its related subordinate legislation, which set out frameworks for securitisation in financial markets. The aim of the revocation is to simplify and streamline the UK’s financial regulations, ensuring they are better suited to the UK’s domestic market. This includes removing technical standards and reporting obligations that were previously aligned with the EU, allowing for a more autonomous and flexible regulatory approach in areas such as securitisation, prudential standards, and investor protections |
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