On March 26, the European Securities and Markets Authority (ESMA) published a Questions and Answers paper on the application of the European Social Entrepreneurship Funds (EuSEF) Regulation (Regulation 346/2013) and the European Venture Capital Funds Regulation (EuVECA) (Regulation 345/2013).
These regulations provide a common EU framework for managers of EuSEF and EuVECA that are registered with the competent authorities.
The paper seeks to answer questions relating to the practical application of the regulations, in order to encourage the adoption of common supervisory approaches among competent authorities. Q&A Paper.
The Bank for International Settlements has published on its website an updated version of the Basel Committee on Banking Supervision’s Basel III monitoring workbook, accompanying instructions and a list of frequently asked questions.
This documentation forms part of the Basel Committee on Banking Supervision’s current monitoring exercise which aims to assess the impact of the Basel III framework and standards on participating banks. Website.
On March 24, the FCA published a report which sets out its findings from a survey of hedge fund activity in the UK.
Key findings are:
- 98 percent of total leverage used by hedge funds in the UK is acquired through derivatives.
- Institutional investors are the dominant investors in hedge funds.
- The proportion of high net worth individuals investing in hedge funds has declined.
- Equity strategies are the most popular among the funds in the survey. Report.
The Financial Conduct Authority (FCA) has fined Besso Limited, an independent management owned general insurance broker in the Lloyd’s Broking group, £315,000 for a failure to take reasonable care to establish and maintain effective systems and controls for countering the risks of bribery and corruption. Press Release.
The Financial Conduct Authority (FCA) and the Bank of England, including the Prudential Regulation Authority (PRA), have agreed on a Memorandum of Understanding (MoU) that sets out how they cooperate with one another in relation to the supervision of markets and market infrastructure, which includes financial markets infrastructures (FMIs). The FCA and the Bank concluded that the MoU’s arrangements for cooperation over the first 11 months of the authorities’ new responsibilities have worked well. The FCA and the Bank continue to refine their cooperative working arrangements and welcome the industry’s suggestions for some areas of consideration. Memorandum of Understanding.
On March 20, ESMA published an updated version of its questions and answers document (Q&A) on the implementation of EMIR (the Regulation on over-the-counter (OTC) derivatives, central counterparties (CCPs) and trade repositories (TRs)) (Regulation 648/2012). The updated Q&A includes a table of questions on pages 6 and 7, setting out which questions have been updated as of March 20, 2014, and to which article(s) in EMIR the updated questions relate. They include:
- Intragroup transactions;
- Notional amounts;
- Risk mitigation techniques for OTC derivative contracts not cleared by a CCP;
- Reporting of outstanding positions following the entry into force of EMIR (backloading); and
- Various issues relating to TR reporting requirements. ESMA Q&A.
On March 19, the European Securities and Markets Authority (ESMA) published a list of the responses it received to its November 2013 consultation on draft guidelines for complaints handling in the securities and banking sectors. The list includes responses from the following bodies:
- Association for Financial Markets in Europe;
- British Bankers’ Association;
- European Banking Federation;
- European Fund and Asset Management Association.
ESMA and the European Banking Authority (EBA), who carried out the consultation jointly with ESMA, intend to publish a final report and guidelines in the first quarter of 2014. Competent authorities will be expected to incorporate the guidelines into their supervisory practices as appropriate. ESMA List of Responses.
Please click here to read Orrick’s coverage of the six most important changes tothe Russian Pledge Rules
On March 3, the Council of the EU published a press release announcing that it has adopted at first reading the proposed Directive recasting the Deposit Guarantee Schemes Directive (94/19/EC).
On February 25, the Council published a revised text of the proposed Directive.
The Council’s adoption of the Directive will enable the European Parliament, with which agreement on the Directive was reached in December 2013, to adopt it without amendment at second reading at its plenary session between April 14 – 17, 2014. Member states will have one year after the Directive’s entry into force to transpose it into national law. Press Release. Revised Text.
On March 3, the Council of the EU published a compromise proposal (dated January 28, 2014) on the European Commission’s proposed Directive on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing (known as the Fourth Money Laundering Directive or MLD4).
MLD4 will amend and replace the Third Money Laundering Directive and is designed to further strengthen the EU’s defenses against money laundering and terrorist financing, while also ensuring that the EU framework is aligned with the Financial Action Task Force standards. Compromise Proposal.