On 31 January 2020, different European bodies issued documents informing on the United Kingdom’s (UK) withdrawal from the European Union (EU) and its consequences. 

In particular, the following documents have been published: 

• ESMA update on governance and reporting obligations; 
• Political declaration setting out the framework for the future relationship between the European Union and the United Kingdom (2020/C 34/01); 
• Council Decision (EU) 2020/135 of 30 January 2020 on the conclusion of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community; 
• Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community; 
• Declaration by the European Union made in accordance with the third paragraph of Article 185 of the Agreement on the Withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community; and 
• Notice concerning the entry into force of the Agreement on the Withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community.

On 9 January 2020, the European Securities and Markets Authority (ESMA) published its Strategic Orientation for 2020-22. 

The Strategic Orientation sets out ESMA’s future focus and objectives and reflects its expanded responsibilities and powers following the ESAs Review, and EMIR 2.2, which increases its focus on supervisory convergence, strengthens its role in building the Capital Markets Union (CMU) and gives it with more direct supervision responsibilities.   

ESMA’s new powers and responsibilities following the outcome of the ESAs Review, EMIR 2.2 and other recent legislative developments include:

• Supervisory Convergence
• Investor Protection
• 3rd country equivalence assessments  
• Traversal topics: technological innovation, sustainable finance and proportionality in its activities
• Direct Supervision:
  i. 3rd country central counterparties;
  ii. critical benchmarks, 3rd country benchmarks and data service providers from 1 January 2022;
  iii. Secularization repositories under the Secularization Regulation; and
  iv. Securities financing transactions under the Securities Financing Transactions Regulation.

To accommodate these new responsibilities, ESMA will grow to 384 by 2022 and has also published an updated organigramme to reflect the changes in its structure.

On 30 January 2020, the European Securities and Markets Authority (ESMA) launched a Common Supervisory Action (CSA) with national competent authorities (NCAs) on the supervision of UCITS’ managers liquidity risk management across the European Union (EU).  

The CSA will be conducted during 2020 and is aimed at assessing simultaneously across member states whether market participants in the NCAs' respective jurisdictions adhere to the rules in their day-to-day business. This will be done on the basis of a common methodology developed together with ESMA. The CSA assessment framework includes scope, methodology, supervisory expectations and timeline.

BACKGROUND
The first phase of the Securities Financing Transactions Regulation (SFTR) comes into force on 13 April 2020 for investment firms and credit institutions, and in July 2020 for central counterparties and central securities depositories.
The objective is to increase the transparency of financing markets.

WHAT'S NEW?
On 6 January 2020, the European Securities and Markets Authority (ESMA) published its final report on ESMA's Guidelines on reporting under the SFTR, supplemented by amended SFTR validation rules and a statement on Legal Entity Identifiers (LEI).
The guidelines should clarify a number of provisions of the SFTR and provide practical guidance on the implementation of some of those provisions. More specifically, they have the objective to contribute to the reduction of costs along the complete reporting chain.

In particular, ESMA provides guidance on the following elements: 

• The reporting start date when it falls on a non-working day; 
• The number of reportable securities financing transactions (SFTs); 
• The population of reporting fields for different types of SFTs; 
• The approach used to link SFT collateral with SFT loans; 
• The population of reporting fields for margin data; 
• The population of reporting fields for reuse, reinvestment, and funding sources data; 
• The generation of feedback by trade repositories (TRs) and its subsequent management by counterparties, namely in the case of rejection of reported data and/or reconciliation breaks; and lastly 
• The provision of access to data to authorities by TRs.

The LEI statement accompanying ESMA's report should clarify the expectations with regard to reporting the LEI for issuers of securities used in SFTs, as well as the relevant supervisory actions to be carried out by authorities.
Finally, ESMA has updated the SFTR validation rules. The amended SFTR validation rules are aligned with the updated XML schemes published in December 2019, as well as with the LEI statement.

WHAT'S NEXT?
ESMA's guidelines apply from the day following their publication on ESMA's website, i.e. 6 January 2020, or from the date on which the relevant provisions to the entities as determined by Article 33(2) SFTR apply, i.e. either April or July 2020.
The counterparties, entities responsible for reporting and the report-submitting entities are encouraged by ESMA to use the guidelines starting from the first day on which the relevant reporting obligation becomes applicable.

On 13 January 2020, the Financial Services and Markets Authority (FSMA) published Communication FSMA_2019_30 relating to the questionnaire concerning the good repute and experience of candidates for regulated functions.
The questionnaires to be completed are designed to enable the FSMA to assess the fitness and propriety of candidates for regulated functions at the Belgian public investment firms.

On 28 January 2020, the Financial Services and Markets Authority (FSMA) published a Communication on SFTR.
The communication deals with the requirement to report securities financing operations according to article 4 of the SFTR.

On 8 January 2020, the Autorité des marchés financiers (AMF) unveiled its priorities for action and priorities for supervision for 2020.

Priorities for action
The AMF has drawn up its priorities for action for 2020, which is the third year of its #Supervision 2022 strategic plan. The AMF has defined five priority areas, for which set the following objectives:

• The attractiveness of financial markets in terms of both corporate financing and the allocation of household savings: as part of the review of several European texts, the AMF intends to promote simpler and more proportionate regulation for the organisation of financial markets. It also wishes to contribute to the adoption of new French or European retirement savings schemes and the development of employee savings schemes;
• The regulatory framework and supervision of asset management with the aim of supporting a clearer architecture and greater regulatory convergence in Europe, to remain engaged in work on risk analysis in this sector and to continue at national level to strengthen the set-up for the fight against money laundering and terrorist financing;
• Continued preparation for the post-Brexit period, not only to accompany stakeholders, but also to play a role in defining future relations between Europe and the United Kingdom and the means to reinforce the financial markets of the 27 members;
• The transition to sustainable finance by contributing to the definition of a permanent framework that combines the quality and comparability of the non-financial information of listed companies, making ESG approaches to asset management more transparent, and monitoring the climate commitments of the Paris financial centre, in conjunction with the Autorité de Contrôle Prudentiel et de Résolution;
• The competitiveness of European financial centres as regards digital technology by supporting the construction of a European framework that is conducive to innovation and which at the same time maintains retail investor trust in investment offers by stepping up the fight against financial fraud.

At the same time, the AMF intends to continue its transformation in particular by the digitalisation of its processes and the use of data. 

Supervisory priorities
Since 2018, the AMF has published its supervisory priorities for the year at the beginning of the year. For 2020, it has set out the following themes for its monitoring and oversight priorities:

For asset management companies:

• Delegation of permanent control,
• Management of liquidity risk,
• Granting of loans,
• Cybersecurity,
• Prevention of money laundering and terrorist financing.

For market intermediaries: 

• Reporting, post-trade transparency, best execution under European financial markets legislation (MiFID 2),
• Liquidity contracts,
• Provision of cross-border services,
• Transition of benchmarks.

Distribution players:

• Product governance under MiFID 2,
• Implementation of requirements regarding the suitability of investment services or products to the client’s profile as defined by MiFID 2,
• Supervision of financial investment advisers.

Version française

Le 8 janvier 2020, l'Autorité des marchés financiers (AMF) a présenté les priorités d’actions et de supervision du régulateur pour 2020.

Priorités d'actions
L’AMF a élaboré ses priorités d’actions pour 2020, la troisième année de sa stratégie #Supervision 2022. L’Autorité a défini cinq domaines prioritaires, pour lesquels elle s’est fixée des objectifs :

• L’attractivité des marchés financiers à la fois en matière de financement des entreprises et d’allocation de l’épargne : à l’occasion de la révision de plusieurs textes européens, l’AMF entend promouvoir une règlementation plus simple et proportionnée pour l’organisation des marchés financiers. Elle souhaite également contribuer à l’appropriation des nouveaux dispositifs français ou européen d’épargne retraite et le développement de l’épargne salariale ;
• Le cadre réglementaire et la supervision de la gestion d’actifs avec l’objectif de soutenir une architecture plus claire et une plus grande convergence de la réglementation en Europe, de rester engagé dans les travaux relatifs à l’analyse des risques de ce secteur et la poursuite au niveau national du renforcement des dispositifs de la lutte contre le blanchiment et le financement du terrorisme ;
• La poursuite de la préparation de l’après-Brexit, à la fois pour accompagner les acteurs, mais également pour contribuer à définir les relations futures entre l’Europe et le Royaume-Uni et et les moyens pour renforcer les marchés financiers à 27 ;
• La transition vers une finance durable en contribuant à la définition d’un cadre permettant d’allier qualité et comparabilité de l’information extra-financière des sociétés cotées, une plus grande lisibilité des approches ESG dans la gestion d’actifs tout en mettant en œuvre le suivi des engagements des acteurs de la place financière de Paris en faveur du climat, conjointement avec l’Autorité de contrôle prudentiel et de résolution ;
• La compétitivité des places européennes dans le numérique en soutenant la construction d’un cadre européen favorable à l’innovation tout en préservant la confiance des épargnants vis-à-vis des offres d’investissement en intensifiant la lutte contre les escroqueries financières.

Parallèlement, l’AMF entend poursuivre sa transformation avec notamment la digitalisation de ses processus et l’utilisation de la donnée. 

Priorités de supervision
Depuis 2018, l’AMF publie en début d’année ses priorités de supervision pour l’année. Cette année, elle a retenu parmi ses priorités thématiques de suivi et de contrôle :

Concernant les sociétés de gestion :

• Délégation du contrôle permanent ;
• Gestion du risque de liquidité ;
• Octroi de prêts ;
• Cybersécurité ;
• Lutte contre le blanchiment et le financement du terrorisme.

Concernant les intermédiaires de marché :

• Reporting, transparence post-négociation, meilleure exécution dans le cadre des textes européens sur les marchés financiers (MIF2) ;
• Contrats de liquidité ;
• Fourniture de services transfrontières ;
• Transition des indices de référence.

Concernant les acteurs de la commercialisation :

• Gouvernance des produits dans le cadre de MIF2 ;
• Mise en œuvre des exigences d’adéquation au profil du client des services ou produits d’investissement telles que définies par MIF2 ;
• Supervision des CIF.

On 1 January 2020, France published Decree No 2019-1590 of 31 December 2019 concerning foreign investments in France in the Official Journal.
According to this decree, foreign investment must be subject to authorization when it is involved in activities essential to ensuring the country’s public authority interests, public order, public safety or national defence.

Version française

Le 1 janvier 2020, la France a publié au Journal Officiel le Décret n° 2019-1590 relatif aux investissements étrangers en France.
Selon ce décret, les investissements étrangers doivent faire l'objet d'une autorisation lorsqu'ils interviennent dans des activités essentielles à la garantie des intérêts du pays en matière d'autorité publique, d'ordre public, de sécurité publique ou de défense nationale.

BACKGROUND
On 17 January 2020, the Autorité des Marchés Financiers (AMF) has updated its Position-Recommendation DOC-2013-10 on inducements and fees received in connection with the distribution and portfolio management of financial instruments to take account of the impacts of the transposition of MiFiD II.

WHAT'S NEW?
Position-Recommendation DOC-2013-10 has been updated to take into account the following new provisions resulting from the transposition of MiFID II:

• Providers offering independent investment advice or portfolio management services are banned from receiving any inducements or fees from third parties and retaining them without passing them on to the client; 
• The criteria of enhancement of the quality of the service provided to the client that will make it legal to receive or pay out inducements or fees received or paid out to third parties; and 
• The introduction of the concept of minor non-monetary benefits that may be received or retained under certain conditions under portfolio management and independent advice services. These benefits may be described broadly in the case of the provision of other services.

Furthermore, the AMF clarified:

1. That the concept of minor non-monetary benefits received from or paid to a third party in connection with the provision of a service other than portfolio management or independent investment advice would correspond to the same definition as that of minor non-monetary benefits that are acceptable under the provision of a portfolio management or independent investment advice service;
2. The time when information is provided about the payment/benefit received from third parties in connection with the provision of a non-independent investment advice service; and 
3. The quality and medium of the information to be provided relating to placement fees received by an investment services provider that is also providing an investment service to the investor.

Also, Position-Recommendation DOC-2013-10 takes into account the consequences following from the reinforcement by MiFID II of the provisions applicable to the management of conflicts of interest. Collecting turnover commissions and entry and exit fees on UCIs would generate a conflict of interests for an investment service provider (ISP) providing the portfolio management service. Such conflict of interest would likely have an adverse effect on the customer’s interest and thus needs to be avoided and/or managed. 

The AMF asks in particular that a specific warning about the conflicts of interest resulting from the collection of turnover commissions is communicated to the client beforehand, and that the actual amount of these expenses be explicitly identified and communicated to the client once a year.

WHAT'S NEXT?
Financial institutions are expected to consult the AMF's guidance when establishing compliance with the new provisions on inducements under MiFID II.
However, the AMF eventually plans to reopen the question concerning fees/turnover commission with a view to prohibiting the collection of these fees in connection with the provision of a portfolio management service.

Version française

BACKGROUND
Le 17 février 2020, l'Autorité des marchés financiers (AMF) a mis à jour la position-recommandation DOC-2013-10 relative aux incitations et rémunérations reçues dans le cadre de la distribution et de la gestion sous mandat d’instruments financiers afin de prendre en compte les impacts de la transposition de la directive MIF 2.

WHAT'S NEW?
La position-recommandation DOC-2013-10 est mise à jour pour tenir compte notamment des nouveautés suivantes issues de la transposition des textes MIF 2 :

• l’interdiction faite aux prestataires fournissant les services de conseil en investissement de manière indépendante ou de gestion de portefeuille pour le compte de tiers de recevoir de la part de tiers et de conserver des incitations ou rémunérations sans les restituer au client;
• les critères d’amélioration de la qualité du service fourni au client permettant de légitimer les incitations ou rémunérations reçues ou versées à des tiers ;
• l’introduction du concept d’avantages non monétaires mineurs, dont la perception et la conservation sont acceptables sous certaines conditions dans la gestion de portefeuille pour le compte de tiers et le conseil en investissement indépendant. Ces avantages peuvent être décrits de manière générique dans le cadre de la fourniture d’autres services.

En plus, l'AMF clarifie: 

• que la notion d’avantages non monétaires mineurs reçus d’un tiers ou versés à un tiers en lien avec la fourniture d’un service autre que celui de gestion de portefeuille ou de conseil en investissement indépendant répond à la même définition que celle des avantages non monétaires mineurs acceptables dans le cadre de la fourniture d’un service de gestion de portefeuille pour le compte de tiers ou de conseil en investissement indépendant ;
• le moment de la fourniture de l’information sur les incitations et les rémunérations reçues de tiers en liaison avec la fourniture d’un service de conseil en investissement non indépendant ;
• la qualité et le support de l’information relative aux commissions de placement reçues par un prestataire de services d’investissement fournissant également un service d’investissement à l’investisseur.

Aussi, la position-recommandation DOC-2013-10 tire les conséquences du renforcement par MIF 2 des dispositions applicables en matière de gestion des conflits d’intérêts. La perception de commissions de mouvement et de droits d’entrée et de sortie sur OPC par un prestataire de services d’investissement (PSI) fournissant le service de gestion de portefeuille génère un conflit d’intérêts susceptible de porter atteinte aux intérêts du client. L'AMF demande notamment qu’un avertissement particulier sur les conflits d’intérêts occasionnés par ce mode de rémunération du gérant soit communiqué en amont au client, et que le montant réel de ces frais soient expressément identifié et communiqué au client annuellement..

WHAT'S NEXT?
L'AMF s'attend à ce que les institutions financières consultent l'orientation de l'AMF afin de se mettre en conformité avec les nouvelles dispositions relatives aux incitations en vertu de la directive MIF 2.
Néanmoins, l’AMF envisage à terme d’ouvrir à nouveau le sujet concernant les frais/commissions de mouvement en vue d’interdire la perception de ces frais dans le cadre de la fourniture d’un service de gestion de portefeuille.

On 27 January 2020, the Autorité des marchés financiers (AMF) adopted its action plan to promote investment research.
The AMF is planning to clarify its policy and support certain adjustments at the European level as part of the targeted review of MiFID II. These concern the regulation of issuer-paid analysis, pricing, proportionality, third-party research and ESG research.

The proposed action plan is divided into six themes:

• Support the development of issuer-paid research; 
• Ensure the proper functioning of the research market; 
• Adapt a certain number of provisions to the current Framework;  
• Exempt independent research from the inducement regime; 
• Establish proportionality in the inducement regime; and 
• Prepare the emergence of ESG research.

Version française

Le 27 janvier 2020, l'Autorité des marchés financiers (AMF) a arrêté son plan d’action en faveur de la recherche en investissement.
L'AMF entend préciser sa doctrine et soutenir certains ajustements au niveau européen dans le cadre de la revue ciblée de MIF 2. Ces ajustement concernent spécifiquement l’analyse financée par les émetteurs, tarification, proportionnalité, recherche indépendante, recherche ESG.

Le plan d'action proposé par l'AMF s’organise autour de six axes :

• Accompagner le développement de l’analyse financée par les émetteurs ;
• Assurer le bon fonctionnement du marché de la recherche ;
• Adapter un certain nombre de dispositions du cadre actuel ;
• Exonérer la recherche indépendante du régime des incitations ;
• Instaurer de la proportionnalité dans le régime des incitations ; et 
• Préparer l’émergence d’une recherche ESG.

On 21 January 2020, the Association Française de Gestion (AFG) publishes 2020 edition of its Recommendations on governance concerning general meetings and board of directors of listed companies.

Main modifications for 2020 concern:

• AFG wishes the board of directors examines more closely and takes position on any resolution adopted within the former general meeting with more than 20% opposition of minority shareholders ("significant opposition");
• A hierarchy of risks impacting the company subject to interest investors must be presented to the board of directors;
• Systematic delivery confirmation to investors attesting their vote had been integrated in the calculation of result of votes for general meetings;
• Communication to shareholders and information on the individual diligence of administrators;
• Information of the numbers of beneficiaries planned in the future must be joined to the resolutions concerning the attribution of options ;
• President of the Audit Committee must be interest-free.

Version française

Le 21 janvier 2020, l'Association Française de Gestion (AFG) a publié l'édition 2020 de ses recommandations sur le gouvernement d’entreprise relatives aux assemblées générales et aux conseils d'administration des sociétés cotées.

Les principales modifications 2020 portent sur les points suivants : 

• L’AFG souhaite que le conseil d’administration examine attentivement, et prenne position en conséquence, sur toute résolution adoptée lors de la précédente assemblée générale avec plus de 20 % d’opposition de la part des actionnaires minoritaires (« opposition significative ») ; 
• Le choix d’une hiérarchisation des risques présentés comme impactant la société, sujet d’attention accrue pour les investisseurs, doit faire l’objet d’une implication du conseil d’administration ; 
• L’envoi systématique, par les émetteurs, pour chaque assemblée générale, d’une confirmation adressée aux investisseurs attestant que leur vote a bien été intégré dans le calcul des résultats des votes ;  
• La communication aux actionnaires du mode de tenue des réunions du conseil et des comités (Rémunérations, Nominations et Audit) : l’information relative à l’assiduité individuelle des administrateurs devra refléter si celle-ci résulte d’une présence physique ou non ; 
• Les résolutions relatives à l’attribution d’options devront s’accompagner d’une information sur le nombre de bénéficiaires envisagé pour ces plans à venir ; 
• Le président du Comité d’audit doit être libre d’intérêt, de même que le président du comité des rémunérations.

On 15 January 2020, the  AMF published a study assessing its action regarding the complexity of structured products.

The study measures the impact of a policy published jointly with the Autorité de Contrôle Prudentiel et de Résolution (ACPR) in 2010 and updated in 2016 which has the objective of limiting the complexity of structured products offered to the public in France. It concludes that the guidance has a positive effect, but this is partially offset by an increase in the number of scenarios provided for in the payoff formula of the product.

Structured products are marketed in the form of formula-based funds or structured debt securities and can be sold as vehicles for life insurance contracts. The AMF position 2010-05 defines four criteria to determine whether the financial instruments in question present a risk of retail investors misperceiving the risks. If the financial product does not meet one of these criteria, it is considered to be at risk of being mis-sold. One of these criteria concerns the number of features in the payoff formula. If there are more than three different calculation mechanisms used to determine the overall return on the product, the ACPR and the AMF consider that there is a mis-selling risk. In 2016, the policy was updated to better integrate the complexity of underlying indices in measuring the overall complexity of structured products.

The study was conducted using a database made up of 6,217 formula based collective investment undertakings (CIU) and complex debt securities marketed in France between 2001 and November 2018. It brings new insights that highlights the following main findings:

• a very marked decrease in complexity measured by the number of mechanisms after 2010, although this trend has been partially offset by an increase in the number of scenarios affecting the product’s performance;
• the underlying indices considered as the most complex have been less used since 2017 nevertheless, simpler underlying indices are also less exploited. This reflects a significant development in the sector with the increasing use of newly created indices rather than the more traditional indices;
• gross performance, which does not take into account the costs linked to structured products, is substantially positive in most cases, even when adjusted for inflation;
• structured products appear to underperform when compared to investments in equities or bonds, particularly in a bull market environment;
• the most complex structured products are the worst performers.

In addition to a strict policy and regular supervision of the market, the AMF accompanies professionals by providing them with guides on how to prepare marketing documents that highlight unauthorised practices. The AMF has observed that the marketing materials for structured products are increasingly standardised and compliant with regulations. The regulator is also interested in retail investors’ understanding of the marketing and regulatory documentation provided to them. 

The regulator will continue to be especially vigilant regarding the marketing of structured products and will continue to monitor the complexity of the structured products market, in particular using the indicators resulting from this study.

Version française

Le 15 janvier 2020, l'Autorité des marchés financiers (AMF) a publié une étude sur le bilan de l’action de l’AMF concernant la complexité des produits structurés. 

L’étude mesure l’impact d’une doctrine publiée conjointement avec l’Autorité de contrôle prudentiel et de résolution (ACPR) en 2010 et mise à jour en 2016 qui vise à limiter la complexité de produits structurés offerts au public en France. Elle conclut à un effet positif de la doctrine, néanmoins tempéré par une augmentation du nombre de scénarios prévus dans la formule de calcul du rendement du produit. 

Les produits structurés sont commercialisés sous la forme de fonds à formule ou de titres de créance structurés, ceux-ci pouvant notamment être utilisés comme supports à des contrats d’assurance-vie. La position AMF 2010-05 définit quatre critères permettant d’évaluer si ces produits présentent un risque de mauvaise appréhension des risques par les investisseurs non professionnels. Si le produit financier ne respecte pas l’un de ces critères, il est considéré comme présentant des risques de mauvaise commercialisation. L’un d’eux concerne le nombre de mécanismes compris dans la formule de calcul du gain et de remboursement de l’instrument financier. Au-delà de trois mécanismes de calcul différents pour déterminer le rendement global du produit, l’ACPR et l’AMF considèrent que ce produit présente un risque de mauvaise commercialisation. En 2016, la doctrine a été mise à jour pour mieux intégrer la complexité des indices sous-jacents dans la mesure de la complexité globale des produits structurés.

Réalisée à partir d’une base de données constituée de 6 217 organismes de placement collectifs (OPC) à formule et titres de créance structurés commercialisés en France entre 2001 et novembre 2018, l’étude apporte un éclairage nouveau et relève les principaux constats suivants :

• une très nette diminution de la complexité mesurée par le nombre de mécanismes après 2010 mais ce mouvement a été contrebalancé par une augmentation du nombre de scénarios affectant le rendement du produit ;
• les indices sous-jacents considérés comme les plus complexes sont moins utilisés depuis 2017 néanmoins les indices sous-jacents les plus simples sont également moins exploités traduisant une évolution notable de l’industrie avec le recours de plus en plus fréquent à des indices nouvellement créés plutôt que l’utilisation des indices traditionnels ;
• les performances brutes, qui ne prennent pas en compte les frais associés des produits structurés, sont très largement positives dans la plupart des cas, y compris lorsqu’elles sont corrigées de l’inflation ;
• les produits structurés apparaissent relativement peu performants lorsqu’ils sont comparés à des investissements en actions ou obligations, en particulier dans un contexte de marché haussier ;
• les produits les plus complexes sont les moins performants.

Au-delà d’une doctrine exigeante et d’une supervision régulière du marché, l’AMF accompagne dans son champ les professionnels en leur proposant notamment des guides sur l’élaboration des documents commerciaux afin de mettre en exergue les pratiques non-admises. L’AMF a ainsi pu constater que la documentation commerciale concernant les produits structurés est de plus en plus standardisée et conforme à la réglementation. Par ailleurs, le régulateur s’intéresse également à la compréhension par les épargnants de la documentation commerciale et réglementaire qui leur est remise. Elle a mené une étude auprès des épargnants qui donne les clés d’une communication, claire et intelligible.

Le régulateur continuera d’être particulièrement vigilant aux enjeux de commercialisation des produits structurés et poursuivra son contrôle de la complexité du marché des produits structurés, notamment grâce aux indicateurs issus de cette étude.

On 16 January 2020, the regulation of 8 January 2020 on fees for the transparency register established pursuant to the fourth European Anti-Money Laundering Directive (AMLD 4) was published in the German Official Journal.
The regulation introduces the fees that the register may charge for individually attributable services. In enters into force on the day following its publication.

On 23 January 2020, the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) updated its Circular 06/2018 "Minimum Requirements for complaint management". 

Reason for the update was the Joint Committee of European Securities Authorities' revision of its circular on complaints handling for securities trading and banking, which is the basis of BaFin's circular.

The guidelines are now also to be used by payment initiation service providers and account information service providers within the meaning of the Second Payment Services Directive (PSD2) and by non-credit institutions within the meaning of the mortgage credit directive (Directive 2014/17/EU).

Therefore, non-credit institutions that issue consumer mortgage contracts have been added to the circular. Non-credit institutions are in particular insurance companies, death insurance funds, pension schemes and pension funds. Primary insurance companies already essentially meet the requirements of Circular 06/2018 "Minimum requirements for complaint management" through the requirements of Circular 03/2013 "Minimum requirements for complaint handling by insurance companies".

On 16 January 2020, the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) published the focus topics for its supervision in 2020. 

The document provides transparency and comprehensibility of BaFin's prioritization of topics. 

The following topics will be especially important for all business areas: 

1. Digitization, IT and cyber risks; 
2. Integrity of the financial system and fight against financial crime; 
3. Sustainable business models; and 
4. Sustainable financial economy/finance.

On 31 January 2020, the Bundesanstalt für Finanzdienstleistungsaufsicht (BaFin) published two schedules of charges: 

(1) an overview of the fees payable to BaFin for the management of investment funds on a cross-border basis or through a branch in Germany, and 

(2) an overview of the fees payable to BaFin in the case of cross-border marketing notification procedures.

On 1 January 2020, Hong Kong published the final amended Securities and Futures Rules in its Official Gazette.

The amendments concern the following three sections of the Rules: 

1. Investor Compensation—Claims (Cap. 571T); 
2. Investor Compensation—Compensation Limits (Cap. 571AC); and  
3. Investor Compensation—Levy (Cap. 571AB). 

The amendments relate among others to: 

• Definition of specified person, securities or futures contracts; 
• Claims for Compensation, in particular concerning the notice inviting claims, making a claim for compensation, and the submission of claims; 
• Processing of Claims, in particular concerning potentially required records, determination by Commission, notice of determination, and the payment of the compensation; 
• The interpretation of certain terms such as associated person, claimant, default, default date, related assets, specified person, Stock Connect securities, tribunal; 
• Limits on the amount of compensation; 
• Applicability of levies; and 
• Recoverability of levies as civil debt.

On 7 January 2020, Statutory Instrument No. 691/2019 - European Union (Cooperation Between National Authorities Responsible for the Enforcement of Consumer Protection Laws) Regulations 2019 was published in the Irish Statute Book.
This instrument gathers  the European Union's regulatory instrument laying down the conditions under which competent authorities, having been designated by their Member States as responsible for the enforcement of the Union laws listed in the Annex to the Regulation, co-operate and coordinate actions with each other and with the Commission, in order to enforce compliance with those laws which will enhance the protection of consumers’ economic interests and ensure the smooth functioning of the internal market.

On 15 January 2020, the Central Bank of Ireland announced consumer and investor protection priorities for 2020.
Strengthening consumer protection is at the heart of the Central Bank’s Strategic Plan. This will be achieved through high quality regulation, purposeful engagement, effective gatekeeping, assertive supervision and robust enforcement:

• Consumer protection priorities include Code review, mortgage arrears, culture in financial services firms and differential pricing in motor and home insurance
• Investor protection priorities include enhancing EU supervisory convergence and raising supervisory standards in wholesale securities markets
• Focus will also be on supervising compliance by firms including Virtual Asset Service Providers with anti-money laundering requirements.

On 29 January 2020, the Central Bank of Ireland published the First Edition of the Central Bank European Market Infrastructure Regulation Questions and Answers Document.
This updates and replaces the FAQ webpage on the European Market Infrastructure Regulation, which was previously available on the Central Bank website. In particular, Q&A ID 1009 has been updated in light of the EMIR Refit Regulation.

On 29 January 2020, the Central Bank of Ireland issued the 28th Edition of the Central Bank UCITS Q&A, which includes a new Q&A ID 1094, in relation to investment by UCITS in Contracts for Difference (CFDs), Collateralised Loan Obligations (CLOs), Contingent Convertible Securities (CoCos) and binary options.
The Q&A outlines the Central Bank’s approach whereby a UCITS proposes to invest in CFDs, CLOs, CoCos or binary options and how that UCITS may be subject to enhanced scrutiny at the authorisation phase with a view to ensuring that the proposal is appropriate taking into account the overall portfolio of assets that is proposed for the UCITS.

On 21 January 2020, the Central Bank of Ireland (CBI) published a letter to the industry on securities markets conduct risk.

The central theme underpinning CBI's findings is that entities may not have been adequately identifying the market conduct risk to which they are exposed, and so cannot appropriately mitigate and manage the risk. 

That failure leads to or, where relevant, arises from the following: 

1. Inadequate market conduct risk frameworks: The Central Bank expects regulated entities to fully embed into their organisational arrangements, market conduct risk frameworks and consequential controls that your employees fully understand. 
2. Inadequate governance of market conduct risk: The Central Bank expects the Board and senior management of regulated entities to take full ownership of the governance of market conduct risk. Regulated entities must fully embed compliance with the Central Bank’s Fitness and Probity Regime into their organisational arrangements at local and branch level. 
3. Failure to identify the risk of market abuse: The Central Bank expects regulated entities, issuers and those who act on behalf of issuers (whether or not they are regulated entities) to have systems and controls in place to ensure compliance with their obligations under the Market Abuse Regulation and related legislation.

Regulated entities should review the expectations set out in the Appendix of the letter and address misalignments with their internal frameworks and practices. Issuers to whom this letter is addressed should focus on the relevant concerns expressed in the third finding - failure to identify market abuse risk.

On 9 January 2020, Ireland published the Irish Auditing & Accounting Supervisory Authority Work programme 2020-2022. 

Ireland focuses on a strong regulatory environment and issues High standards settings concerning:

• Regulatory & Monitoring Supervision; 
• Financial Reporting Supervision;  
• Audit Quality; and 
• Conduct.

On 23 January 2020, CONSOB published a table displaying the amount of contributions (defined as "contributo di vigilanza", i.e. "supervision fee") due by the entities under its vigilance for the year 2020.
In the determination of the amount to be paid, the costs deriving from the complexity of activities carried out by each category of entities are taken into account.

On 13 January 2020, the Luxembourg Business Registers communicated on the authentication method to access the Register of Beneficial Owners (RBE). 

The username/password authentication method will be abandoned from 28 February 2020 on. Two new  authentication methods will be available to access the services requiring authentication on the LBR website:

• anonymous authentication, which does not require setting up a user account, and 
• authentication using a LuxTrust product or eID card, which requires setting up a user account afterwards.

BACKGROUND
On 17 January 2020, the Commission de Surveillance du Secteur Financier (CSSF) published Luxembourg’s first money laundering (ML) / financing of terrorism (FT) risk analysis on the Collective Investment Sector.
The analysis is intended to link the National Risk Assessment of money laundering and terrorist financing (NRA), published in December 2018, that assesses Investment Fund Managers situated in Luxembourg to the specific assessment of the Collective Investment Sector being a sub-sector of the Luxembourgish financial industry.

WHAT'S NEW?
Specifically, the CSSF's ML/FT risk analysis develops a more granular and systematic perspective on the risks faced by the Collective Investment Sector, providing for a non-exhaustive list of predicate offences perpetrated within collective investment to help the participants of the Collective Investment Sector to better identify the risks and promote a stricter compliance risk culture.
Moreover, this assessment, targeting all Luxembourg regulated undertakings for collective investments with a focus on Investment Fund Managers (IFM) and other market participants such as service providers, significantly examines ML/FT inherent risks. It also considers risk-mitigating factors applied by IFM and competent authorities, in view of their specific AML/CFT roles and responsibilities in the sector including the Financial Intelligence Unit as well as their impact on inherent risk and the resulting residual risk levels.

WHAT'S NEXT?
The CSSF expects supervised entities involved in the Collective Investment Sector to reflect the findings and conclusions from this sub-sector risk assessment into their own risk assessment to ensure their framework remains appropriate to effectively mitigate ML/FT risks.

On 31 January 2020, the Commission de Surveillance du Secteur Financier (CSSF) published a circular letter, announcing the launch of the annual online survey for the year 2019 collecting standardised key information concerning money laundering and terrorist financing (ML/FT) risks to which the professionals under supervision are exposed and the implementation of related risk mitigation and targeted financial sanctions measures for 3 February 2020.
This cross-sector survey is said to contribute to the CSSF’s ongoing assessment of ML/FT risks present in the financial sectors under its Anti-Money Laundering and Counter Terrorist Financing (AML/CTF) supervision, and forms part of the AML/CTF risk-based supervision approach put in place by the CSSF over the last years. In substance the 2019 survey remains generally unchanged compared to the previous year.
Answers to the survey questions will have to be submitted through the CSSF eDesk portal by 15 March 2020, except for the banking sector where answers have to be submitted by 2 March 2020.

On 31 January 2020, the Commission de Surveillance du Secteur Financier (CSSF) released a communication in the context of Brexit.
This communication follows up on previous communications on Brexit and confirms that the UK will be leaving the EU with a withdrawal agreement on 31 January 2020 at midnight (Brussels time). The CSSF emphasizes that a time-limited transition period will last until 31 December 2020, during which  EU laws and regulations shall continue to apply in the UK and UK entities can continue to work in Luxembourg on the basis of their passporting rights.
As such, the CSSF’s individual decisions granting the 12-month transitional regime to UK entities and all notifications made in that context through the dedicated eDesk portals are lapsing. The dedicated e-Desk portals are closed with immediate effect.
Furthermore, the CSSF stressed that notwithstanding the current political developments, impacted entities should continue to take all necessary steps to prepare and anticipate the end of the transition period.

On 14 January 2020, the CSSF has published the Benchmark Regulation Questionnaire for UCI (Undertakings for Collective Investment).
This questionnaire aims at providing the CSSF with information about the use of benchmark(s) as defined by Regulation (EU) 2016/1011 on indices used as benchmarks in financial instruments and financial contracts or to measure the performance of investment funds and amending Directives 2008/48/EC and 2014/17/EU and Regulation (EU) No 596/2014.

On 27 January 2020, the Commission de Surveillance du Secteur Financier (CSSF)  issued a communication regarding the European Securities and Markets Authority (ESMA)'s Questions & Answers (Q&As) on the application of the UCITS Directive, more specifically on the UCITS’ KIID benchmark and related past performance disclosure obligations.
With a view to the updated Q&As, the  CSSF reminds UCITS management companies and self-managed UCITS that they have to incorporate the necessary changes in the KIIDs by 19 February 2020 (i.e. 35 business days after 31 December 2019) at the latest. The updated KIIDs shall then be transmitted to the CSSF via the usual transmission channels.
Further, the CSSF clarifies that pursuant to the ESMA Q&As the benchmark-related disclosures in the KIID should notably include the following elements: 

• whether the UCITS is “actively” or “passively” managed; 
• the indication of the benchmark index (or indices) the UCITS is tracking or making reference to; 
• the disclosure on the use of the benchmark (e.g. out-performance objective, performance comparison, risk limitation, definition of investment universe), the degree of freedom from the benchmark and the past performance against the benchmark when the investment approach of the UCITS includes or implies a reference to a benchmark.

On 30 January 2020, the Decree of 20 January 2020 determining the time of entry into force of the Financial Benchmarks Regulation Implementation Act was published in the Official Gazette of the Kingdom of the Netherlands.
This decision regulates the entry into force of the Financial Benchmarks Regulation Implementation Act. The European regulation implementing the aforementioned law has been applicable since 1 January 2018. It was therefore decided to have the law take effect immediately after publication in the Official Gazette.

On 31 January 2020, the De Nederlandsche Bank (DNB) issued a new and improved version of the TIBER-NL Guide.
The TIBER documentation has been adapted to stay in line with the rapid developments of the cyber threats and the learning experiences from the TIBER-NL program. This has led to this new version of the TIBER-NL framework.
In 2017 the first version of the Threat Intelligence Based Ethical Red Teaming framework for the Netherlands was released (TIBER-NL). The framework describes how the most important financial institutions in the Netherlands can be tested against current and highly advanced cyber attacks. The tests are conducted under the coordination of DNB.
The most important adjustment in the framework concerns the connection of the intelligence about the institution (what could the attacker use?) and the test scenario that is being played. Also, more emphasis has been placed on learning from the experiences after the test. This way, the institution knows even better after the test where it can strengthen the defense.

On 14 January 2020, the Decision of the De Nederlandsche Bank NV (DNB) and the Netherlands Authority for the Financial Markets (AFM) of 12 December 2019 to amend the Suitability Policy Rule of 2012 was published in the Government Gazette of the Kingdom of the Netherlands.
The amendment is a result of changes in European and national laws and regulations as well as the entry into force of European guidelines. The amended Policy Rule will come into effect on 15 January 2020.

The Policy Rule clarifies what the regulator means by 'suitability' and which aspects are taken into account when assessing a policymaker. The Policy Rule also provides clarity about when policymakers should or could be tested and what information and antecedents the regulator takes into account.
The amendment to the Policy Rule does not concern a complete revision and does not change the existing assessment policy of DNB and AFM. However, it provides for the application by DNB and AFM in their supervision of the ESMA Guidelines on the management body of market operators and providers of data reporting services and the EBA/ESMA Guidelines for assessing the suitability of members of the management body and employees with a key position.

On 16 January 2020, the Netherlands Authority for the Financial Markets (Autoriteit Financiële Markten, AFM) published its agenda for 2020 and a strategy document outlining the AFM’s focus areas for the coming years 2020 to 2022.
In the Agenda 2020, the AFM states that the five most important trends for its supervision are digitalisation, macroeconomic developments, changes in European and other regulation, geopolitical developments and the transition to a sustainable economy. Furthermore, the document explains the renewed strategy of the AFM. The AFM’s mission is to translate the five aforementioned trends into tangible supervisory objectives for the financial markets. The AFM indicates that it will continue to make its supervisory processes more data driven and to develop the knowledge and competences of its employees. 

The Strategy 2020-2022 sets out the AFM’s strategy for the coming three years covering four areas of supervision: 

• Financial services (protection of customers in vulnerable situations); 
• Capital markets (a robust infrastructure and fair trading practices); 
• Asset management (a sustainable business model for asset managers and due care for clients); and 
• Auditing (improved quality of audits and contribution to effective incentives for audit firms).
• In addition, the AFM provides more detail on its supervisory approach and philosophy, i.e. describing how they operate and how they make their decisions.

On 17 January 2020, the Law of 4 December 2019 amending the Financial Supervision Act and the Economic Offenses Act in connection with the implementation of Regulation (EU) No 2016/1011 of the European Parliament and of the Council of 8 June 2016 on indices that are used as benchmarks for financial instruments and financial agreements or to measure the performance of investment funds was published in the Official Gazette of the Kingdom of the Netherlands.
The law is cited as Financial Benchmarks Regulation Implementation Act. It serves the purpose to lay down rules for the implementation of Regulation (EU) No 2016/1011, the European Benchmarks Regulation (BMR). More specifically, it adds the BMR to the list of regulations for which the Dutch supervisors ensure compliance of financial institutions.
The law enters into force on a date to be determined by Royal Decree. 

On 22 January 2020, the De Nederlandsche Bank (DNB) published its supervisory outlook for 2020.
In the document, DNB states that its supervisory work will be more data-driven and supported to a larger extent by digital technologies. To achieve this objective, DNB will collaborate more intensively with the sector in 2020 to gain more knowledge about the impact and opportunities of technological innovations. One way to do so will be the Innovation Forum (iForum), in which banks, insurers, pension funds and payment institutions will work together. The iForum was launched at the end of 2019.

On 20 January 2020, the De Nederlandsche Bank (DNB) informed the public that as of the same day, a legal sanction regime applies in the Netherlands for violations of the prohibition of IBAN discrimination.
IBAN discrimination thereby refers to the case when European payments are refused due to the origin of the bank account. Such IBAN discrimination is prohibited because it undermines the smooth functioning of the European payment market. The prohibition exists since 2014, the year of the transition to the Single European Payments Area (SEPA). A new feature as of now is that DNB will be authorized to impose an order subject to a penalty or a fine if a payer or recipient refuses to accept a payment to or from a bank account number from another European foreign country. Before proceeding to do this, DNB will however first warn the institution to end the violation.

On 14 January 2020, the draft law of 27 November 2019 on adapting the Swiss federal law to developments in the area of Distributed Ledger Technologies (DLT) was published in the Swiss Official Journal.
The draft law aims at adjusting several federal laws to improve the conditions for Switzerland to establish itself as a leading, innovative and sustainable place for Blockchain/DLT firms. In general, the Federal Council does not yet see a need for conducting a comprehensive overhaul of the regulatory framework or adopting a specific law for DLT firms. However, in single areas of the law targeted adjustments would be necessary to increase legal certainty, remove barriers to the application of DLT and to mitigate new risks.
More specifically, the draft law comprises amendments to the securities law in order to create a safe legal basis for trading securities via DLT-enabled registers. In addition, crypto-based assets shall be legally removed from the insolvency assets. Concerning the financial market infrastructure law, a new authorization category for DLT trading systems shall be created to achieve a flexible and adequate legal framework for the new forms of financial market infrastructures enabled by the recent technological developments.

On 31 January 2020, the Swiss Federal Council informed the public of the impacts that the United Kingdom (UK)'s withdrawal from the European Union might have on Switzerland.
First and foremost, the Federal Council clarifies that the withdrawal of the UK from the European Union at midnight on 31 January 2020 will not change the relationship between Switzerland and the UK in the near future: the bilateral agreements between Switzerland and the EU will continue to apply to the UK until the end of the transition period on 31 December 2020 (which may be extended).
Switzerland could use the transition period to continue to work out together with the UK their future relationship as part of the Swiss “Mind the Gap” strategy.  As part of this ‘Mind the gap’ strategy, Switzerland concluded at an early stage a series of new agreements with the UK in the areas of trade, migration, road and air transport and insurance. The aim of the ‘Mind the gap’ strategy is to safeguard existing mutual rights and obligations as far as possible. In a second step, cooperation between Switzerland and the UK is to be expanded beyond the current level where this is in the interests of both sides (‘Mind the Gap plus’).
More information on Switzerland's actions and priorities with regard to Brexit can be found in the fact sheet, which the Federal Department of Foreign Affairs (FDFA) published along the Council's statement.

On 13 January 2020, the Eidgenössische Finanzmarktaufsicht (FINMA) published a fact sheet of 1 January 2020 on on-site supervisory reviews, one of FINMA’s key supervisory tools.
FINMA can carry out such on-site supervisory reviews as part of its supervisory activities. According to FINMA, it decides to do so on the basis of general financial market risks or specific events. On-site supervisory reviews would provide important insights for supervision and if necessary result in further measures.

On 14 January 2020, the regulation of 13 December 2019 on the financial market supervision act (Finanzmarkaufsichtsgesetz, FINMAG) of 22 June 2007 was published in the Swiss Official Journal.
With this regulation, pursuant to Art. 55 FINMAG, the Swiss Federal Council enacts provisions with respect to: 

• FINMA's fulfilment of tasks in the international and regulatory context; 
• the regulatory principles pursuant to Art. 7 FINMAG; and 
• the collaboration and information exchange between FINMA and the  Eidgenössisches Finanzdepartement (EFD). 

FINMA is obliged to review all its regulations and carry out necessary adjustments within five years of the date of entry into force of the regulation, which will be the 2 February 2020. 

On 21 January 2020, the Eidgenössische Finanzmarktaufsicht (FINMA) published its updated Questions & Answers (Q&As) document on FINMA's distribution portal (Version: December 2019).
The document explains to supervised entities what the distribution portal is, which purpose it serves and which actions are required by users of the platform. Furthermore, detailed technical questions on the use of the platform are answered.

On 1 January 2020, the Eidgenössische Finanzmarktaufsicht (FINMA) published cooperation agreements pursuant to Art.120 para. 2 let. e CISA.
Foreign collective investment schemes must be approved by FINMA if they are to be offered to non-qualified investors in Switzerland. A prerequisite for such approval is the existence of a cooperation agreement between FINMA and the relevant foreign supervisory authority (Art. 120 paragraph 2 let. e CISA).
According to Art. 128 para. 4 CISO, FINMA is obliged to publish a list of the countries of those supervisory authorities with which it has concluded a cooperation agreement pursuant to Art. 120 para. 2 let. e CISA. FINMA has so far signed a corresponding cooperation agreement with the relevant supervisory authorities from the following countries: Austria, Belgium, Denmark, Estonia, France, Germany, Guernsey, Hong Kong, Ireland, Jersey, Liechtenstein, Luxembourg, Malta, Netherlands, Norway, Sweden, United Kingdom (UK).

On 16 January 2020, the Bank of England (BoE), Financial Conduct Authority (FCA) and the Working Group on Sterling Risk-Free Reference Rates (RFRWG) have published a set of documents, outlining priorities and milestones for 2020 on LIBOR transition.

To help achieve this, the RFRWG has published its priorities and an updated roadmap for the year ahead to highlight important events and clarify actions market participants should take to reduce LIBOR exposure and transition to alternative rates, including: 

• Ceasing issuance of cash products linked to sterling LIBOR by end-Q3 2020; 
• Throughout 2020, taking steps that demonstrate that compounded SONIA is easily accessible and usable;
• Take steps to enable a further shift of volumes from LIBOR to SONIA in derivative markets;
• Establishing a framework for the transition of legacy LIBOR products, in order to significantly reduce the stock of LIBOR referencing contracts by Q1 2021;
• Considering how best to address issues “tough legacy” contracts.

The BoE and FCA support these objectives and have published two documents designed to further catalyse transition efforts: 

• First, a joint letter that has been sent to major banks and insurers, supervised in the UK. This letter sets out the initial expectations of the FCA and PRA of firms’ transition progress during 2020, including in relation to the targets set by the RFRWG, and highlights the FPC’s close monitoring of the steps being taken. 
• Second, a statement from the Bank and the FCA encouraging market makers to switch the convention for sterling interest rate swaps from LIBOR to SONIA on 2 March 2020. This is designed to help progress transition in the derivatives market. 

The RFRWG has also published a series of documents, including: 

• A document setting out the RFRWG’s views on which types of business and client should use overnight SONIA, relative to alternatives including forward-looking term rates. This concludes that use of SONIA compounded in arrears is appropriate and operationally achievable for 90% of new loans by value, which is consistent with the RFRWG’s existing expectation that the use of forward-looking term rates will be more limited than the current use of LIBOR. The Bank and FCA supports this conclusion fully. 
• A set of helpful ‘lessons learned’ from recent conversions of legacy LIBOR contracts.
• A factsheet that makes clear the “whys” and “what's” of LIBOR transition that sets out why all market participants need to act now.

On 23 January 2020, the Bank of England published a letter from Sarah Breeden and David Bailey concerning the removal of bespoke liquidity risk appetite.
The PRA has been monitoring the liquidity positions of the largest and most systemically important banks and investment firms active in the UK against a bespoke risk appetite. This is designed to reflect the potential for market volatility, should the UK leave the European Union without a Withdrawal Agreement, to impact firms’ liquidity positions. This risk appetite has been based on the firms’ liquidity positions reported through the FSA047/048 returns and expressed as a minimum survival period calculated under different wholesale stress scenarios.
The parliamentary stages of the European Union (Withdrawal Agreement) Bill were completed on 22 January. The likelihood that the UK leaves the EU without a Withdrawal Agreement now appears very low. Therefore, the PRA no longer considers the bespoke risk appetite to be required.

On 6 January 2020, the International Swaps and Derivatives Association (ISDA) published a guide to the cross-border application of US, EU and Japanese margin rules for non-cleared derivatives.
This guide describes the cross-border and substituted compliance rules under different margin regimes, and uses that framework to examine the applicable rules for the US, the European Union and Japan. It focuses on the position of an entity that is not a swap dealer but is either directly subject to margin rules or is obliged to comply with the margin requirements of its counterparties.
A large number of counterparties will come into scope of initial margin (IM) requirements for non-cleared derivatives in 2020 and 2021. This has increased the focus on the applicability of the rules to cross-border trading relationships.
However, there are practical challenges in analyzing multiple foreign rule sets and identifying situations in which different rules will apply, as well as understanding whether substituted compliance is available to reduce the compliance burden. Firms will need to understand the different aggregate average notional amount calculations that are relevant to them, the IM thresholds that apply to their trading relationships, and the substantive requirements they will have to meet.

On 22 January 2019, AMIC and EFAMA updated their 2016 report “Managing Fund Liquidity Risk in Europe” following important policy and regulatory developments at EU and international levels.
The purpose of this updated report is to outline the practical liquidity risk management processes which fund management companies put in place when setting up a fund and implement throughout the life of the fund. Also, the report describes the existing European and international regulatory frameworks in the area of fund liquidity risk management.