Thursday 17 March 2022

UK: Independent Panel on Ring-fencing and Proprietary Trading - final report published

The Independent Panel on Ring-fencing and Proprietary Trading has published its final report: see here (pdf). Various recommendations are made, including that the scope of the ring-fencing regime should be changed to include firms only where there is a clear financial stability benefit.

Malta: MFSA consults on new corporate governance code

The Malta Financial Services Authority is currently consulting on a new corporate governance code, to cover all unlisted MFSA authorised entities. A copy of the consultation document and new code can be found, respectively, here (pdf) and here (pdf). The code contains principles and supporting provisions, the latter to be applied on what is described as a 'best effort basis'.

UK: The Economic Crime (Transparency and Enforcement) Act 2022

The Economic Crime (Transparency and Enforcement) Act 2022 became law earlier this week: see here or here (pdf). The explanatory memorandum will be available here when published. Parts 1 and 2, not yet in force (secondary legislation is required), contain the framework for the new register of overseas entities owning land in the UK and will make changes to the unexplained wealth order regime. Part 3 makes changes to the sanctions regime, chapter 2 of which is already in force.

Netherlands: updating the Dutch Corporate Governance Code

A consultation has begun in respect of proposed changes to the Dutch Corporate Governance Code: see here (in English).

UK: The Parker Review - an update on improving the ethnic diversity of UK boards

Almost there: the message from the Parker Review, in its latest update (here, pdf), concerning the target that all FTSE100 boards should have at least one director from a minority ethnic group. In the FTSE250, the target has been met by just over half of companies.

UK: England and Wales: public companies - 'equitable considerations' and shareholder remedies

Judgment was delivered today in Duneau v Klimt Invest SA & Ors [2022] EWHC 596 (Ch). While first instance, I note it here (rather quickly) because of the very interesting discussion it contains concerning the extent to which 'equitable considerations' can arise - for the purposes of just and equitable winding-up (section 122(1)(g) of the Insolvency Act 1986) and the unfair prejudice remedy (sections 994-996 of the Companies Act 2006) - in public companies. 

Monday 14 March 2022

UK: England and Wales: APP fraud and the bank's duty of care

Judgment was given today by the Court of Appeal in Philipp v Barclays Bank UK Plc [2022] EWCA Civ 318. At first instance ([2021] EWHC 10 (Comm), [2021] WLR(D) 60) before HHJ Russen QC, summary judgment was granted, the judge finding that the bank did not owe a duty of care (the Quincecare duty) to its customer in a case of authorised push payment (APP) fraud (a type of fraud where, as a result of the fraudster's persuasion, the customer gives instructions to the bank). Indeed, the judge stated that to impose such a duty of care would amount to "an unprincipled and impermissible extension of the Quincecare duty" (para. [184]).

Today, granting an appeal, the Court of Appeal held that the judge was wrong to grant summary judgment and it ordered that the case should proceed to trial. Delivering the only reasoned judgment, Lord Justice Birss (with whom the Chancellor and Coulson LJ agreed) held that it was possible, at least in principle, that a duty of care could arise where a customer instructs their bank to make a payment where the customer is the victim of APP fraud (para. [78]). The Quincecare duty, his Lordship held, was not limited to situations where the bank received instructions from the customer's agent. 

Friday 11 March 2022

G20/OECD Principles of Corporate Governance - review update

The OECD has published further information about its review of the G20/OECD Principles of Corporate Governance: see here. Included is a report about the review, prepared by the OECD's Secretary-General, for G20 Finance Ministers and Central Bank Governors. The report, available here (pdf), contains the review's terms of reference and proposed roadmap. The Committee responsible for the review expects revised Principles to be approved in the second half of 2023.

UK: The Economic Crime (Anti-Money Laundering) Levy Regulations 2022

The Economic Crime (Anti-Money Laundering) Levy Regulations 2022 were laid before the House of Commons today and come into force on 1 April: see here or here (pdf). Their purpose is to make provision in respect of the administration of the new levy (introduced by Part 3 of the Finance Act 2022) by those responsible for its collection (HMRC, the FCA and the Gambling Commission). For further information, see the accompanying explanatory memorandum: here (pdf). Further Regulations are expected and will, amongst other things, deal with appeals, debt transfers, information sharing and enforcement.

BCBS newsletter: covid-19 related credit risk issues

The Basel Committee on Banking Supervision has published a newsletter on covid-19 related credit risk issues: see here. While not setting out new supervisory guidance or expectations, the newsletter is intended to provide some detail concerning the Committee's internal discussions.

Thursday 10 March 2022

UK: FRC announces new Stewardship Code signatories

The Financial Reporting Council has, today, published an updated list of signatories to the UK Stewardship Code. The updated list includes 74 new signatories, from 105 applications made at the end of October 2021. The total number of signatories is now 199. 

Perhaps more interestingly, the FRC has stated - at the bottom of its press release announcing the new 74 signatories - that following "wide engagement with stakeholders" it no longer plans to tier or differentiate signatories to the Code from 2022. Signatories were not tiered last year, but in March 2021 (see here, pdf, para. 39) the FRC said that it "may in future consider introducing mechanisms to differentiate the quality of signatories' reports". The reason given by the FRC today (to quote from the press release): "Asset owners, investment consultants and investment managers felt that standard to become a Stewardship Code signatory is already high and that the FRC should focus on encouraging more of the market to reach this standard". 

Wednesday 9 March 2022

UK: England and Wales: Court of Appeal finds no statutory trust arose in respect of electronic money holder funds

Judgment was given today by the Court of Appeal in Baker v Financial Conduct Authority (Re Ipagoo LLP) [2022] EWCA Civ 302. The court has confirmed that the Electronic Money Regulations 2011 do not impose a statutory trust in relation to funds received by an electronic money institution from an electronic money holder.

Update (11 March 2022) - a summary of the case has been provided by the ICLR: see here


Tuesday 8 March 2022

UK: ONS publishes latest data on ownership of UK quoted company shares

The Office for National Statistics has published the latest edition of its regular analysis of the ownership of UK quoted company shares: see here. The survey considered ownership at the end of 2020, and found that 56.3% of shares by value were held by investors outside of the UK - a record high.

UK: HL Committee - Fraud Act 2006 and digital fraud inquiry - call for evidence

The House of Lords Select Committee set-up to consider the Fraud Act 2006 and digital fraud has published a very wide-ranging call for evidence: see here. Specific questions are asked under the following headings: the fraud landscape; action to tackle fraud; legislative remedies; and best practice. The Committee, which was formed earlier this year, has already started to take oral evidence from witnesses - the transcripts are available here and recordings of the hearings can be found on

Saturday 5 March 2022

European Union: The CRA Regulation and private credit ratings

The CRA Regulation does not apply to "private credit ratings produced pursuant to an individual order and provided exclusively to the person who placed the order and which are not intended for public disclosure or distribution by subscription" (article 2(2)). 

Guidelines published in 2013 (here, pdf) noted that there were some circumstances in which a private rating could be shared with a limited number of third parties on a strictly confidential basis. Uncertainty, nevertheless, remained - but perhaps for not much longer because the European Securities and Markets Authority has published, for consultation, amendments to the Guidelines: see here (pdf). These focus on key elements in article 2(2) - including "produced pursuant to an individual order" and "provided exclusively to the person who placed the order" - as well as the 2013 Guidelines, in particular by defining "limited number of third parties" by reference to an upper limit of 150 natural persons.

Australia: ASIC's corporate governance priorities

Joseph Longo, the chair of Australia's Securities and Investment Commission, has delivered a speech setting out the regulator's corporate governance priorities for the year ahead: see here. Included are cyber risks and whistleblowing.

Wednesday 2 March 2022

UK: The Finance Act 2022

A copy of the Finance Act 2022, which received Royal Assent last month, has been published: see here or  here (pdf). The materials accompanying the Act when it was, as a Bill, before Parliament are available here.

Amongst the provisions in the Act, the following are - for me - particularly noteworthy: sections 7 and 8 (replacing the current system of basis periods, and introducing a new method through which self-employment income/profits are allocated to tax years); sections 53 to 66 (the framework introducing the new Economic Crime (Anti-Money Laundering) levy); section 85 (providing HMRC officers with the power to seek the winding-up of a company, in the public interest, to protect the public revenue); and section 96 (the introduction of a new disclosure requirement, for large businesses, in respect of the 'uncertain tax treatment' of items in a tax return). 

Tuesday 1 March 2022

UK: The Economic Crime (Transparency and Enforcement) Bill 2022

The Economic Crime (Transparency and Enforcement) Bill 2022 was introduced in the House of Commons today, receiving its first reading: see here. In broad outline, the Bill provides for the introduction of a register of overseas entities owning land in the United Kingdom; it also makes changes to the way in which unexplained wealth orders operate.

A copy of the Bill, as introduced, is available here (pdf). The Bill is accompanied by explanatory notes (here, pdf), two impact assessments (here and here, pdf) and two memoranda - one concerning human rights (here, pdf), the other concerning delegated powers (here, pdf). 

UK: Corporate Transparency and Register Reform - white paper published

The Government has published its corporate transparency and register reform white paper: see here (pdf). As explained in the consultations preceding the white paper, the intention is to improve the quality and accuracy of information held on the register of companies by, for example, the introduction of new identity checks and providing the Registrar with new powers, include a power of query.