Wednesday 10 November 2021

UK: Financial Services - Future Regulatory Framework Review - Reform proposals

Yesterday the Government published for consultation various reform proposals as part of its Future Regulatory Framework Review for financial services: see here (pdf). 

The paper endorses the current regulatory model as set out in the Financial Services and Markets Act 2000, which reflects the reforms made following the financial crisis over ten years ago - the creation of the FCA, PRA and a greater role for the Bank of England. It does, nevertheless, propose introducing new statutory objectives for the FCA and PRA linked to growth and competitiveness. The regulatory principles are to be amended to provide that growth should occur in a way consistent with the Government commitment to achieve a net zero economy by 2050. The paper also proposes increasing the mechanisms through which the regulators are accountable to Parliament.

And, unsurprisingly, we are to see much current retained EU law transferred to the regulators' rulebooks, with the regulators given new rule-making powers as required.  This process - to be achieved through secondary legislation - is expected to take several years.

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