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See Scott Robert’s regulatory roundup for the first half of May:
- The FCA has released a consultation paper on ‘The Consumer Duty’, a new principle which will apply exclusively to firms engaging with ‘retail’ customers:
‘The Consumer Duty’ is a new rule the FCA is proposing to introduce which, if not adhered to, could result in enforcement action. The FCA wants stronger protections for consumers in financial markets citing its Financial Lives Survey which showed that 1 in 4 respondents lacked confidence in the financial services industry and only 35% agreed financial service firms are honest and transparent. The Consumer Duty principle will seek to mandate firms to act in the consumer’s best interests and take all reasonable steps to avoid foreseeable harm to consumers. The proposals are open for responses until 31st July 2021, to read more or provide a response click here. Scott Robert will draft an article summary next week with further details.
- The FCA has published its Regulatory Initiatives Grid which includes key ‘milestones’ in the regulatory landscape for the next two years:
The FCA has published its ‘Regulatory Initiatives Grid’, a document that shows a timeline of key and significant dates within the regulatory landscape of the FCA. Firms may find the Grid useful as it is divided into multiple sectors where relevant milestone dates are identified. Firms can view the Gird here.
- The Insolvency Service has increased the eligibility criteria for Debt Relief Orders (DROs) which will come into effect at the end of June 2021:
Changes to DROs by the Insolvency Service are estimated to allow 13,000 more individuals struggling with debt to gain access to DROs over IVAs or bankruptcy. The changes to the eligibility criteria for DROs are: an increase to the total amount of debt allowable from £20,000 to £30,000, an increase in the value of assets owned by the individual from £1000 to £2000, and an increase in the level of surplus income from £50 to £75 per month. Scott Robert has written an article summarising the changes and explaining what DROs are. The article can be viewed here.
- The FCA and the Bank of England (BoE) are encouraging market participants to switch to SONIA by June 17th:
The FCA and BoE have released a joint statement seeking liquidity providers in the sterling exchange traded derivatives market to move SONIA and away from LIBOR. The FCA explains this will bring benefits for many users in the market if firms move to SONIA ahead of LIBOR ceasing by the end of 2021. Before encouraging this move, the FCA surveyed participant firms and saw 100% of respondents support the move and 92% agree on the June 17th The statement can be found here.
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