FCA Legislation Update

On 26 April 2013, the FCA published its first Policy Development Update (PDU) for April 2013 which details forthcoming FCA publications relating to a number of areas, including RRP, client assets and EMIR, as detailed below.

High level standards

Initiative	Current Expected Publication Date	Previous Expected Publication Date
Recovery and Resolution Plans: policy statement to CP11/16	Q2 2013	Q2 2013
Policy statement on non-EEA national depositor preference regimes	TBC	–

Business Standards

Initiative	Current Expected Publication Date	Previous Expected Publication Date
Client assets regime – multiple client money pools – policy statement to part 2 of CP12/22	June 2013	Q2 2013
Client assets review – consultation paper	June 2013	–
Review of the client money rules for insurance intermediaries – policy statement to CP12/20	Q3/4 2013	Q3/4 2013
CRD IV – consultation paper on strengthening capital standards	Q3/4 2013	TBC

 

Defining the Clearing Threshold for Non-Financial Counterparties Under EMIR

If you have an interest in regulatory reform matters beyond simply RRP and CASS RP, you may be interested in a new post regarding the clearing threshold for non-financial counterparties under EMIR that has just been published on my other blog, which has been recently lauched – please see here.

All the best

Michael

RRPs for CCPs within the EU by the end of 2012

On 26 June 2012, the FSA published a speech on the issue of derivatives reform given by David Lawton, Acting Director of Markets, to the IDX International Derivatives Expo in London.

Mr Lawton noted that good progress had been made in reforming derivatives markets, but that issues were outstanding in four main areas:

• rules for bilateral collateralisation of uncleared trades;
• recovery and resolution plans for central counterparty clearing houses (CCPs);
• promoting consistent cross-border application of requirements; and
• ensuring the readiness of firms, both financial and non-financial, which are not currently clearing OTC derivative trades.

Mandatory clearing will increase the amount of risk concentrated in CCPs.  In turn, this brings into focus the importance of effective recovery and resolution planning for CCPs, which will be the subject legislation at an EU level before the end of 2012.  In addition, the Committee on Payment and Settlement Systems (CPSS) and International Organisation of Securities Commissions (IOSCO) are due to publish a consultation paper on this issue.  This is likely to be based on the FSB’s “Key Attributes of Effective Resolution Regimes for Financial Institutions”, which were published in October 2011.  The consultation paper will seek to identify whether and how each Key Attribute applies to a Financial Market Infrastructure (FMI) and what special guidance may be needed for FMIs, authorities and other parties.

The text of the speech is available here.