Tracker, Financial Services Regulation & Compliance - Cross Sectoral

DOMESTIC:

Deputy Governor for Financial Regulation of the Central Bank of Ireland elected Chair of ESMA's Investment Management Standing Committee
The CBI's Deputy Governor for Financial Regulation, Cyril Roux, was elected as Chair of ESMA's Investment Management Standing Committee. This role has been held by the CBI since 2012 and Mr. Roux had the following to say about the CBI's continued appointment, "the Central Bank’s continued occupancy of this role reflects our commitment to contribute to the current international regulatory work on asset management and financial stability, which will be an important element of ESMA’s work plan in the coming period. It also reflects range and depth of knowledge in Ireland’s investment funds sector and its standing in European policy forums."

Central Bank of Ireland publish Intermediary Times – Issue 4
The CBI has published the fourth publication of the 2016 Intermediary Times. The headline topics discussed in this issue relate to information technology and cybersecurity, amendments to the Consumer Protection Code (the CPC) arising out of the Mortgage Credit Directive, professional indemnity insurance requirements of mortgage intermediaries, the CBI's themed inspection of structured retail products, a supervisory focus on pre-approved control functions, and advertising under the CPC.

Director of Policy & Risk of Central Bank of Ireland says "Central Bank is committed to transparency and clarity in its authorisation processes and performance standards"
The CBI's Director of Policy & Risk. Gerry Cross, speaking at a Deloitte briefing on Brexit, discussed the CBI's capacity to deal with the increased number of authorisation applications that may be seen following Brexit. Mr. Cross stressed that the CBI's primary concern is ensuring that "regulated firms with business models exposed directly or indirectly to the UK economy have addressed and planned appropriately for negative impacts that may result from the UK decision to leave".

Departments of Finance and Justice and Equality publish National Risk Assessment on money laundering and terrorist financing 
On 10 October 2016, the Department of Finance and the Department Justice and Equality jointly published the "National Risk Assessment for Ireland – Money Laundering and Terrorist Financing" (the NRA). The purpose of the NRA is to identify and assess the risks faced by Ireland in relation to anti-money laundering and terrorist financing ahead of the implementation of the fourth Anti-Money Laundering Directive. This is Ireland's first NRA and is part of its obligations as a FATF member to carry out ongoing review of its anti-money laundering and terrorist financing prevention procedures. 

Central Bank Act 1942 (Section 32D) Regulations 2016 and associated guidance published 
The Central Bank Act 1942 (Section 32D) Regulations 2016 (the Industry Funding Regulations) were published in Iris Oifigiúil on 7 October. The Industry Funding Regulations apply to all financial service providers regulated by the CBI with the purpose of allowing the CBI to raise part (50%) of its budget for regulatory activities directly from financial service providers. The CBI has also published its "Guide to the 2016 Industry Funding Regulations" providing guidance how the industry funding levy for 2016 is calculated and applied. 

Governor of the Central Bank of Ireland delivers speeches on "The Eurozone After Brexit" 
The Governor of the CBI, Philip Lane, delivered a speech entitled "The Eurozone After Brexit" at a joint meeting of the Euro50 Group and the CIGI in Washington DC, on 9 October. Mr. Lane discussed the capacity of banking systems and financial markets to react to the immediate aftermath of the Brexit referendum and absorb the result. Mr. Lane went on to discuss the "longer-term perspective" including the importance of negotiating a satisfactory settlement between the EU and the UK that will be mutually beneficial for both sides. 

On 28 October, Mr. Lane also addressed a Reuters Newsmaker event in London on the topic of ‘The European Financial System After Brexit' discussing the potential implications of Brexit for the configuration of the European financial system, emphasising the importance of a Capital Markets Union and stating that financial activity is unlikely to cluster in one location following Brexit.

General Scheme of the Financial Services and Pensions Ombudsman Bill 2016 published 
The General Scheme of the Financial Services and Pensions Ombudsman Bill 2016 was published on 6 October by the Department of Finance. The draft legislation proposes the introduction of an Ombudsman to resolve complaints "concerning the conduct of regulated financial service providers or pension providers involving the provision of a service they provide". The purpose of the proposed Bill is to amalgamate the Financial Services Ombudsman and the Pensions Ombudsman, as well as taking the opportunity to update the role of the Ombudsman, generally. Minister for Finance, Michael Noonan, welcomed the opportunity to debate this new Bill. 

EUROPEAN:

European Banking Authority updates list of correlated currencies
On 11 October 2016, the EBA published an updated list of correlated currencies in accordance with the implementing technical standards made under the Capital Requirements Regulation (Regulation (EU) No 575/2013).

Finance Watch issue press release calling for the European Commission to present an ambitious plan to protect consumers of retail financial services
On 11 October, the independent, non-profit association Finance Watch released a press release calling on the European Commission to protect consumers of retail financial services and to follow recommendations received from the European Parliament's ECON Committee in its “Report on the Green Paper on Retail Financial Services”. Finance Watch note the increasing reliance on financial markets by individual citizens and the increased digitalisation of services. In particular, Finance Watch have called for "more accessible, basic financial products being offered; a sensible way of paying financial advisors; and proper enforcement of consumer protection rules".

Joint Committee of the European Supervisory Authorities publishes its 2017 Work Programme
The Joint Committee of the ESAs (ESMA, EBA and EIOPA) published its Work Programme for 2017. The ESAs will have a particular focus on "assessing more closely both cross-sectoral opportunities and threats induced by the increasing digitalisation of finance and financial technology, commonly known as fintech".

Director of Regulation of the European Banking Authority the European Parliament's Committee of Inquiry into Money Laundering, Tax Avoidance and Tax Evasion’s (PANA)
On 13 October, the EBA's Director of Regulation, Isabelle Vaillant, addressed a public hearing of the PANA Committee of the European Parliament on the issues of anti-money laundering and financial crime in the context of the "Panama Papers". Ms. Vaillant discussed the EBA's role as an independent authority safeguarding the integrity of the financial markets before going on to discuss the EBA's reaction to the Panama Paper leaks.

European Commission publishes Q&A on its 2017 Work Programme
On 25 October, the European published a Q&A document on its 2017 Work Programme. This document includes information such as what the Commission's priorities are for the year and how the Programme compares to previous years. The document also discusses REFIT, which is the Commission's Regulatory Fitness and Performance programme. This involves a review of existing EU legislation to ensure it remains relevant and effective.

European Commission publishes statement on the G7 fundamental elements of cybersecurity in the financial sector
The European commission issued a supporting statement welcoming the publication of the G7 fundamental elements of cybersecurity in the financial sector (the Fundamental Elements). The Fundamental Elements were published by the G7 Cyber Expert Group and set out principles that entities involved in the financial sector should follow in relation to cybersecurity. The Fundamental Elements relate to matters such as governance, risk and control assessment, monitoring and information sharing.

In welcoming the introduction of these principles, the Commission's Vice-President responsible for financial services and financial markets, Valdis Dombrovskis said the following, "Today’s financial system relies more and more on information technology. While this provides enormous advantages in terms of performance, efficiency, convenience and cost, the downside is the increased risk of cyber-attacks against our financial institutions. We now need to focus on being one step ahead of these threats, so as to ensure the integrity of financial services and infrastructure. I welcome the G7’s acknowledgment of the need for co-ordinated action so we can jointly tackle cyber threats."

European Banking Authority and ESMA publish Consultation Paper in relation to joint guidelines on the assessment of the suitability of members of management bodies and key function holders under the CRD and MiFID II
The Consultation Paper, published on 28 October 2016 contains draft guidelines on the assessment of the suitability of members of the management body of credit institutions, investment firms, financial holding companies and mixed financial holding companies.

European Commission establishes expert group for the development of a European strategy on sustainable finance
On 28 October 2016, the European Commission announced its decision to establish a high-level expert group to develop a comprehensive strategy on sustainable finance.  

For further information please contact a member of the Financial Regulation team.

Date published: 04 Nov 2016