Category: Financial Services

EXPLANATORY MEMORANDUM TO THE MARKETS IN FINANCIAL INSTRUMENTS, BENCHMARKS AND FINANCIAL PROMOTIONS (AMENDMENT) (EU EXIT) REGULATIONS 2021 2021 No. [XXXX] 1. Introduction 1.1 This explanatory memorandum has been prepared by HM Treasury and is laid before Parliament by Act. 1.2 This memorandum contains information for the Sifting Committees. 2. Purpose of the instrument 2.1 This instrument […]

EU Financial Services Legislation Most EU legislation on financial services is agreed between the European Parliament and (the member states in) the EU Council. Most decisions are taken by a qualified majority vote. Where fiscal and taxation provisions are involved, the decision must be unanimous. In this context, financial services include banks, insurance companies, investment […]

Supervisory Authorities Three European supervisory authorities (ESAs) were formed as part of the European Union banking reforms following the financial crisis. The ESAs are part of the ESFS (European System of Financial Supervision) together with the national regulators and the ESRB (European Systematic Risk Board). Each is a separate legal entity with significant autonomy. The […]

Financial Collateral A Directive on financial collateral seeks to reduce credit risk in collateral financial transactions between financial institutions.  The purpose is to provide for the rapid and informal enforcement of financial collateral.  States may not make the creation, protection,  enforceability or admissibility of financial collateral arrangement dependent on the performance of any formal act. […]

Regulation of Credit Institutions Credit institutions authorised in one EU state may provide services in other EU states. An institution established in one state which wishes to establish a branch in another state must notify the authorities of its home state giving details of the program of operations and detailed plans. The home state must provide […]

UCITS UCITS are undertakings for collective investment in transferable securities. UCITS are usually undertakings with the sole object of collective investment in transferable securities or other liquid financial assets, capital raised from the public and which operate on the principle of risk spreading, units of which are repurchased or redeemed out of the undertaker’s assets. They […]

Regulation The European Union has legislated in relation to insurance services.  As part of the freedom of movement of capital and freedom to provide services, there is legislation setting down common principles of insurance regulation. An insurance company established and regulated in the state may provide services across borders or may establish itself in other […]

Investment Services The granting and the renewal of authorisations for investment firms is undertaken in the home member state.  The competent authority (the central bank) must ensure that the investment firm has sufficient additional resources for its activities that the persons directing it have sufficient integrity professional experience and that the holders of interests in […]

AIF Managers Authorisation A 2011 directive regulates managers of alternative investment funds.  The purpose is to ensure an internal market for these managers while putting in place a harmonized regulatory framework. Alternative investment fund managers are entrusted with portfolio management and risk investment of alternative investment funds (AIFs). They may additionally perform the duties of […]

Listing of Securities EU directives have laid down common standards for stock exchange listing requirements.  The rules provide for the information that must be published when companies are first admitted to the exchange and their ongoing publication obligations. The documents are provided and published in the country where the issuer of the shares has its […]

Consumer Credit Directive EU states must ensure persons offering credit obtain authorisation. They must be regulated and inspected; Bodies must be established to provide information and advice to consumers in relation to credit agreement and complaints. The EU directive on consumer credit harmonises many of the general conditions and information obligations in the area of […]

Payments Market Framework An EU directive aims to establish a framework for the creation of an integrated payments market.  It covers payment service providers established in the EU.  It covers payments in euro and other national currencies of the EU. It does not apply to cash or cheque payments. The directive establishes a number of […]

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Important Notice- See the Disclaimer Below Brexit Legal, McMahon Legal and Paul McMahon have no liability arising from reliance on anything contained in this article nor on this website Contact McMahon Legal 

Important Notice- See the Disclaimer Below Brexit Legal, McMahon Legal and Paul McMahon have no liability arising from reliance on anything contained in this article nor on this website

Important Notice- See the Disclaimer Below Brexit Legal, McMahon Legal and Paul McMahon have no liability arising from reliance on anything contained in this article nor on this website

Single Supervisory Mechanism Framework regulation Regulation (EU) No 468/2014 — EU mechanism for banking supervision (SSM framework regulation) It sets out the legal framework on the practical arrangements for implementing the Single Supervisory Mechanism* (SSM), in order to support the supervisory responsibilities which are given to the ECB and the national bank supervisors. It governs […]

Bank dividend policy – ECB recommendation Recommendation of the European Central Bank on dividend distribution policies (ECB/2015/49) This is a recommendation from the European Central Bank (ECB) on bank dividend policy. It aims to ensure that banks are able to meet capital requirements after paying out dividends. KEY POINTS Banks should adopt a conservative and […]

Establishing bank resolution funds Communication (COM(2010) 254 final) — Bank Resolution Funds It describes the intentions of the European Commission concerning the establishment of bank resolution funds. KEY POINTS What is the role of bank resolution funds? Resolution funds should contribute to financing the orderly resolution of distressed banks. In order to do this, they […]

The statutory audit — ensuring accurate company financial statements SUMMARY OF: Directive 2006/43/EC on statutory audits of annual accounts and consolidated accounts WHAT IS THE AIM OF THE DIRECTIVE? It merges two existing pieces of legislation (Directive 78/660/EEC on individual financial statements and Directive 83/349/EEC on consolidated financial statements) so as to improve the reliability […]

Short selling of securities Regulation (EU) No 236/2012 on short selling and certain aspects of credit default swaps It seeks to regulate certain aspects of short selling* and credit default swaps (CDS)* in the European Union (EU). KEY POINTS In times of financial instability, certain financial transactions such as short selling, ‘naked short selling’* and […]

Simpler, more transparent and more standardised securitisation Regulation (EU) 2017/2402 — general framework for securitisation and creating a specific framework for simple, transparent and standardised securitisation It aims to restart a high quality securitisation* market that will: improve the financing of the EU’s real economy; enhance private risk sharing; and ensure investor protection. It creates […]

Credit rating agencies Regulation (EC) No 1060/2009 on credit rating agencies It seeks to regulate the activity of credit rating agencies to protect investors and European financial markets against the risk of malpractice. Its aim is to guarantee the independence and integrity of the credit rating process and to improve the quality of the ratings […]

Insurance and reinsurance Directive 2009/138/EC on the taking-up and pursuit of the business of Insurance and Reinsurance (Solvency II) Known as Solvency II, it requires insurance companies to hold enough financial resources. It also sets out management and supervisory rules. The directive covers non-life insurance, life insurance and reinsurance companies. It has applied since 1 […]

Better regulated and transparent financial markets SUMMARY OF: Directive 2014/65/EU on markets in financial instruments It aims at making financial markets in the European Union (EU) more robust and transparent. It creates a new legal framework that better regulates trading activities on financial markets and enhances investor protection. The new rules, called ‘MiFID 2’, revise […]

Prospectus to be published when securities are issued and offered to the public Regulation (EU) 2017/1129 — securities prospectus It aims to help companies, especially SMEs, access different forms of finance in the EU. It does so by simplifying and streamlining the rules and procedures they must apply when drawing up, securing approval and distributing […]

Preventing market abuse in financial markets Regulation (EU) No 596/2014 on market abuse The market abuse regulation (MAR) seeks to ensure that European Union (EU) regulation keeps pace with market developments to combat market abuse on financial markets as well as across commodity and related derivative markets (i.e. markets trading primary products such as gold, […]

Single Euro Payments Area Regulation Regulation (EU) No 260/2012 — technical and business requirements for credit transfers and direct debits in euro It sets out the rules and technical requirements for credit transfers and direct debit transactions in euro within the single euro payments area (SEPA). KEY POINTS National accounts used for credit transfers and […]

Consumer credit agreements Directive 2008/48/EC on consumer credit agreements It harmonises EU rules regarding credit granted to consumers who borrow to finance purchases of goods and services (holidays, goods, new cars, etc.) It aims to open up the EU’s consumer loan market, whilst improving the transparency of contract terms and the level of consumer protection. […]

Opening/switching bank accounts and information on fees Directive 2014/92/EU — comparable and transparent fees and rules for all payment accounts and payment account switching It aims to tackle 3 main issues: access to basic payment accounts*, transparency and comparability of payment account fees, and bank account switching. It has applied since 17 September 2014. EU […]

Strengthening global competitiveness of EU investment funds Directive 2009/65/EC — rules relating to undertakings for collective investment in transferable securities (UCITS) It lays down uniform rules on investment funds, allowing the cross-border offer of investment funds regulated at EU level. It sets out the EU’s main regulations governing UCITS*. KEY POINTS The main aims of […]