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AML & Financial Services Regulatory

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In AML & Financial Services Regulatory

United Kingdom: Financial Conduct Authority (FCA) proposes to expand payment optionality rules to fund managers

by and 1 Min Read

On 26 July 2024, in response to the UK Government’s Investment Research Review on the effectiveness of the investment research market, the FCA published its final rules and guidance to permit the bundling of payments for investment research and trade execution by investment firms. The final rules, which took effect on 1 August 2024, adapt the FCA’s policy to evolving markets and better align with the regulatory position in the EU and US. The FCA has now proposed to extend reintroduction of the bundled payment model to managers of pooled funds – i.e., AIFMs and UCITS ManCos.

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In Corporate Compliance

Hong Kong: SEHK issues new guidance letter highlighting its expectations on independent investigations conducted by long suspended issuers

by and 5 Mins Read

On 26 November 2024, The Stock Exchange of Hong Kong Limited (SEHK) issued a new guidance letter (GL120-24) to inform the market of its expectations on investigations conducted by suspended issuers and the roles of the directors and the independent investigation committees (IIC). According to the latest monthly prolonged suspension status report published by the SEHK, as at 29 November 2024, there were 57 Main Board and eight GEM issuers which have been suspended for three months or more.

In AML & Financial Services Regulatory

Canada: Amplified risks for financial institutions from AI, OSFI and FCAC Report

by and 6 Mins Read

On 24 September 2024, following an in-depth consultation with industry participants, the Office of the Superintendent of Financial Institutions (OSFI) and the Financial Consumer Agency of Canada (FCAC) published their findings concerning the use and adoption of artificial intelligence (AI) by federally regulated financial institutions. The report highlighted that a significant majority of financial institutions will adopt AI by 2026, and also set out a number of key risks that arise for financial institutions from AI usage. OSFI and FCAC emphasized the need for financial institutions to adopt a dynamic and responsive risk management system with respect to AI, and confirmed their commitment to work towards more specific best practices for industry participants.

In AML & Financial Services Regulatory

Singapore: MAS responds to feedback received on proposed framework for single family offices

by , , , and 3 Mins Read

On 6 November 2024, the Monetary Authority of Singapore published its responses to the feedback on the July 2023 consultation paper that set out a proposed regulatory framework for Single Family Offices operating in Singapore. SFOs are exempt from licensing under the Securities and Futures Act 2001, and the proposals are aimed at harmonizing the criteria for a simplified class exemption regime and addressing potential money laundering risks posed by SFOs.
MAS will provide further details on the effective date of implementation, revised legislation and mode of submission for the initial notification and annual return prior to the implementation of the SFO framework.

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In Cybersecurity, Data and Tech

Singapore: First Reading of the Protection from Scams Bill

by , , , and 5 Mins Read

The Ministry of Home Affairs introduced the Protection from Scams Bill for First Reading in Parliament on 11 November 2024. The Bill empowers the Police to issue Restriction Orders (ROs) to banks to restrict an individual’s banking transactions, if there is reasonable belief that the individual will make money transfers to scammers.

In Corporate Compliance

Luxembourg: New accounting thresholds in Luxembourg — what companies and groups need to know

by and 4 Mins Read

The Grand-Ducal Regulation of 25 October 2024 (GDR) introduced new accounting thresholds in Luxembourg, aligning with Delegated Directive (EU) 2023/2775, which was adopted on 17 October 2023.
This measure aims to increase the accounting thresholds applicable to companies and groups in response to the inflation observed between 2013 (adoption of the 2013 EU Accounting Directive) and 2023, and to reduce administrative burdens for businesses.
For that purpose, the GDR amends the provisions of the Luxembourg law on commercial companies dated 10 August 1915 as amended and the Luxembourg law on the register of commerce and companies and accounting dated 19 December 2002 as amended.

In AML & Financial Services Regulatory

Australia: Taming the Solvency Sea Dragon

by and 3 Mins Read

Directors in corporate groups can take greater comfort when relying on financial support from related entities, following a recent Full Court of the Federal Court decision in the case of Canstruct Pty Ltd v Project Sea Dragon Pty Ltd (Subject to a Deed of Company Arrangement) [2024] FCA 112.
Last year, doubt was cast on the adequacy of financial support that is not fully documented or binding to establish the solvency of a related company. This decision has reset that position in favor of such arrangements potentially being sufficient, provided actual support is given.

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In AML & Financial Services Regulatory

United States: The SEC adopts EDGAR Next – What public companies need to know now

by , and 7 Mins Read

On September 27, 2024, the Securities and Exchange Commission (SEC) approved final rules as part of technical amendments to EDGAR (collectively, referred to as “EDGAR Next”) to enhance the security of the system. The rulemaking amends Rule 10 and 11 of Regulation S-T, Form ID (needed to obtain EDGAR access codes) and updates the EDGAR Filer Manual.
EDGAR Next will significantly change how filers access EDGAR, make filings, and manage accounts.

In AML & Financial Services Regulatory

Canada: Deadline approaching for registration under the Retail Payment Activities Act

by , and 6 Mins Read

Registration for payment service providers under the new Retail Payment Activities Act is fast approaching. Individuals or entities performing retail payment activities in Canada have a 15-day window between 1 November 2024 and 15 November 2024 to submit their applications with the Bank of Canada to avoid a 60-day delay in performing their retail payment activities, a notice of violation under the Act, or significant monetary penalties. If you or your entity may be required to be registered as a payment service provider under the Retail Payment Activities Act, and you have not yet prepared your application materials, please contact us as soon as possible and we will help.

In AML & Financial Services Regulatory

Australia: Further improvement required for product issuers distribution practices

by , , and 5 Mins Read

Last month ASIC announced that it is calling upon product issuers to ensure distribution practices are ‘up to scratch’. This announcement follows the release of Report 795 Design and distribution obligations: Compliance with the reasonable steps obligation by ASIC. Alan Kirkland, ASIC Commissioner, has said that improvements across the board are still required to ensure that consumers feel confident that the financial products they purchase will suit their needs.

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