ISDA® publishes 2018 Benchmarks Supplement Protocol

ISDA® publishes 2018 Benchmarks Supplement Protocol

On 11 December 2018, ISDA® published the ISDA 2018 Benchmarks Supplement Protocol, which enables parties to incorporate the ISDA Benchmarks Supplement into relevant transactions under existing master agreements. Relevant transactions referencing benchmarks include interest rate, foreign exchange, equity and commodity derivatives transactions. The Benchmarks Supplement, which was published in September 2018, enables parties to such derivatives transactions to supplement definitions used in the transaction documents, so that they conform to certain requirements of the EU Benchmarks Regulation (2016/1011).

Parties are not required to incorporate the Benchmarks Supplement into transactions with all of their adhering counterparties. Parties are also free to decide whether or not to apply the Protocol to existing Master Agreements. Barring any agreement between adhering parties to that effect, the Protocol will only apply to new transactions. The text of the Protocol, guidance on the mechanics and a link for adherence, together with answers to frequently asked questions, are available on the Protocols page of ISDA’s website.

Draft Collective Investment Scheme (Amendment etc) (EU Exit) Regulations 2019 laid before Parliament

On 17 December 2018, a draft version of the Collective Investment Schemes (Amendment etc) (EU Exit) Regulations 2019 was published on, together with an explanatory memorandum. The purpose of the Regulations, which have been laid before Parliament, is to ensure that the regime established under the UCITS IV Directive (2009/65/EC) for investment funds and their managers continues to operate effectively after Brexit.

It contains amendments to the retained provisions of delegated acts made under UCITS IV (Commission Regulation 2010/583 and Commission Delegated Regulation (EU) 2016/438), as well as UK legislation including the Financial Services and Markets Act 2000 (FSMA) and related secondary legislation. The Regulations will come into force on exit day, except for certain provisions specified in regulation 1(3). These include regulations 59 to 70 (Temporary recognition for the purposes of Part 17 of FSMA), which come into force on the day after the day on which the Regulations are made. HM Treasury published updated versions of the draft Regulations and related explanatory information document on 7 December 2018.

The Money Laundering and Terrorist Financing (Miscellaneous Amendments) Regulations 2018

The Money Laundering and Terrorist Financing (Miscellaneous Amendments) Regulations 2018 (SI 2018/1337) (the regulations) was laid before Parliament on 13 December 2018. They make amendments to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLR 2017), the Oversight of Professional Body Anti-Money Laundering and Counter Terrorist Financing Supervision Regulations 2017 (oversight regulations) and the Solicitors (Scotland) Act 1980.

The regulations come into force on 10 January 2019.

FCA final rules giving SMEs access to FOS

On 17 December 2018, the FCA published the Small Business (Eligible Complainant) Instrument 2018 (FCA 2018/61) (FOS 2018/7). The instrument contains the final rules extending access to the Financial Ombudsman Service (FOS) to more small and medium-sized enterprises (SMEs), larger charities and trusts, and a new category of personal guarantors. The final rules, which are set out in the FCA’s Dispute resolution: complaints sourcebook (DISP), come into force on 1 April 2019. This immediately follows the entry into force of the changes made by the Claims Management Instrument 2018 (FCA 2018/56) (FOS 2018/6).

FCA updates webpage on preparing your firm for Brexit

On 13 December 2018, the FCA published a press release advising that it has updated its webpage on preparing your firm for Brexit.

The FCA expects that, by now, firms will have considered the issues it has previously highlighted (see Legal update, FCA speech and new webpage on approach to Brexit). It has updated its webpage to follow up on some key areas:

FCA wholesale banks and asset management cyber multi-firm review findings

On 10 December 2018, the FCA published a webpage setting out the findings from its cyber multi-firm review of 20 firms in the asset management and wholesale banking sectors. The review’s aim was to help assess how wholesale banking and asset management firms oversee and manage their cyber security, how far they identify and mitigate relevant risks and their current capability to respond to and recover from incidents and successful attacks.

Key findings include the following:

The FCA encourages firms to review its findings and how they apply to their own organisations. It sets out a series of questions that board and management committee members should consider as they review their cyber security and how to manage cyber risk.

BEIS response to consultation on reform of limited partnership law

On 10 December 2018, BEIS published a response to its consultation on reforming the law of limited partnerships. The response includes: