Global Regulatory Updates for Financial Services

What Changed

• - ESMA clarifies what constitutes a “defined ranking system” under the EU ESG Ratings Regulation (ESGRR), including when rating scales, score bands or league tables will be regarded as a ranking...
• ESMA sets out transitional provisions for existing ESG rating providers active before ESGRR application, detailing conditions and timelines under which they may continue operating while completing...
• ESMA explains how ESG rating providers established after the ESGRR date of entry into force must comply, including the need to obtain authorisation/registration before commencing activity in the EU...
• ESMA defines what qualifies as “material changes to registration information” for ESG rating providers under ESGRR, indicating the types of changes (e.g.
• Under MAR and Commission Delegated Regulation (EU) 2016/957, ESMA clarifies expectations regarding the annually conducted audit of market soundings arrangements, including scope, independence of the...

Suggested Considerations

• Map all existing and planned ESG rating products against ESMA’s clarified concept of a “defined ranking system” and update methodologies, scales, and disclosures to ensure they meet ESGRR and Q&A expectations.
• For ESG rating providers operating before 02 July 2026, develop and execute a documented transitional compliance plan that aligns governance, methodologies, data controls and transparency with ESGRR, ensuring timely notification to ESMA within one month from 02 July 2026.
• For entities intending to launch ESG rating activities after ESGRR entry into force, prepare and submit complete authorisation or registration files to ESMA before commencing rating activity, incorporating the Q&A guidance on initial registration requirements.
• Establish or enhance a formal process to identify, assess and record “material changes to registration information” for ESG rating providers, and implement controls to ensure ESMA is notified within required timelines before or immediately after such changes, as specified in the Q&A.
• Review and update MAR compliance frameworks, with particular focus on market soundings procedures, to incorporate ESMA’s expectations on the scope, independence, and documentation of the annually conducted audit required under Commission Delegated Regulation (EU) 2016/957.

Key Dates

References

• [1] esma.europa.eu/press-news/esma-news/new-qas-available-26
• [2] esma.europa.eu/press-news/esma-news/new-qa-tool-launched
• [3] esma.europa.eu/press-news/esma-news/new-qas-available-19
• [4] esma.europa.eu/press-news/esma-news/esma-publishes-new-qa...
• [5] esma.europa.eu/press-news/esma-news/new-qas-available-23
• [6] esma.europa.eu/press-news/esma-news/new-qa-available
• [7] esma.europa.eu/press-news/consultations
• [8] centralbank.ie/regulation/markets-update/esma-guidelines-...

What Changed

• - The PRA finalises amendments to the Reporting Pillar 2 Part of the PRA Rulebook, including updated Pillar 2 data items (FSA072–FSA076 and FSA081) and an updated Pillar 2 reporting schedule, with...
• The PRA issues an updated Statement of Policy (SoP) 5/15 – The PRA’s methodologies for setting Pillar 2 capital, providing revised methodologies across credit, operational, pension obligation, market...
• The PRA issues an updated SoP 5/25 – The PRA’s methodologies for setting Pillar 2 capital for Small Domestic Deposit Takers (SDDTs), tailoring Pillar 2A approaches and expectations for SDDTs.
• The PRA updates Supervisory Statement (SS) 31/15 – ICAAP and SREP, clarifying expectations on how firms should assess, document and justify Pillar 2A capital in ICAAPs, including how to reflect...
• The PRA updates SS 4/25 – ICAAP and SREP for SDDTs, setting proportionate ICAAP expectations and aligning SDDT guidance with the revised Pillar 2A framework.

Suggested Considerations

• Map your firm’s current Pillar 2A capital framework against the updated SoP 5/15 and, where applicable, SoP 5/25 to identify methodology changes across credit, operational, pension, market and counterparty credit risk.
• Update ICAAP methodologies, models and documentation to reflect revised PRA expectations, including new or enhanced use of credit risk and operational risk scenarios and any updated calibration standards.
• Review and, where necessary, redesign ICAAP governance (board oversight, senior management ownership, model risk and validation frameworks) to ensure that new scenario‑driven and systematic Pillar 2A methodologies are subject to appropriate challenge and approval.
• For firms with material sovereign, central bank, regional government or unconditionally cancellable retail exposures, implement the new systematic Pillar 2A credit risk methodologies and assess the impact on capital requirements and risk‑weighted exposure allocation.
• For firms with significant operational risk, enhance scenario analysis frameworks to capture low‑frequency, high‑severity loss events at the PRA’s expected soundness level, and embed these outputs into ICAAP capital quantification.

Key Dates

References

• [1] finreg.aoshearman.com/PRA-Phase-1-of-Pillar-2A-review
• [2] addleshawgoddard.com/en/insights/insights-briefings/2025/...
• [3] bankofengland.co.uk/prudential-regulation/publication/202...
• [4] deloitte.com/uk/en/blogs/ecrs/the-pra-pillar-2a-framework...
• [5] finreg-e.com/pillar-2a-reform-pra-compliance-finrege/
• [6] afme.eu/media/runaekaf/250930-afme-response-to-pra-cp-122...
• [7] ukfinance.org.uk/policy-and-guidance/consultation-respons...

What Changed

• - The PRA has finalised new and restated PRA Rulebook Glossary definitions that replace the CRR definitions previously found in Articles 4, 4A, 4B and 5 for PRA Rulebook purposes.
• The PRA has made consequential amendments across other Parts of the PRA Rulebook to align internal cross-references and terminology with the new glossary structure.
• The PRA has updated Supervisory Statement SS15/13 – Groups to reflect the transfer of CRR definitions into the PRA Rulebook framework.
• The PRA has stated that the vast majority of definitions are restated without substantive policy change, but some definitions were clarified for drafting consistency and readability.
• HM Treasury has set the legislative timetable so that the relevant CRR Articles 4–5 will be revoked from 1 January 2027, while the statutory restatement of selected definitions was made in April 2026.

Suggested Considerations

• Review all internal policies, manuals, and regulatory interpretation documents that currently cite CRR Articles 4, 4A, 4B, or 5 and replace those references with the corresponding PRA Rulebook Glossary definitions.
• Update capital adequacy, prudential reporting, and risk management systems to use the new PRA Rulebook terminology where definitions have moved from the CRR text.
• Reconcile group supervision materials, governance papers, and consolidation analyses against the revised SS15/13 wording to ensure group structures are assessed using the updated definitions.
• Map every affected business line and legal entity to determine which Rulebook Parts and counterparties rely on the transferred CRR definitions.
• Test template agreements, customer disclosures, and internal controls for terminology drift where contractual drafting depends on CRR-defined concepts.

Key Dates

References

• [1] finreg.aoshearman.com/uk-pra-final-policy-on-restatement-...
• [2] bankofengland.co.uk/prudential-regulation/publication/202...
• [3] cms.law/en/gbr/regulatory-news/pra-cp19-25-crr-definition...
• [4] prarulebook.co.uk/legal-instruments?subchapter=6518f952dc...
• [5] bankofengland.co.uk/prudential-regulation/publication/202...
• [6] prarulebook.co.uk/legal-instruments?rule=63da81b30a81496b...
• [7] prarulebook.co.uk

What Changed

• - ESMA proposes revised Guidelines on standardised procedures and messaging protocols for allocations and confirmations under CSDR Settlement Discipline, specifically to support the transition to a...
• The guidelines will mandate the use of electronic, standardised communication channels for post‑trade allocations and confirmations, moving away from mixed paper / manual practice to fully electronic...
• Firms will be required to use international messaging standards (e.g. ISO‑based protocols) for post‑trade communication, to ensure interoperability and faster straight‑through processing across EU...
• The guidelines remove references to non‑electronic and non‑machine‑readable methods, including oral allocations and confirmations, except where there is a temporary technical disruption that prevents...
• The revisions are explicitly aligned with ESMA’s Final Report on Amendments to the CSDR RTS on Settlement Discipline, which introduce same‑day timing for allocations and machine‑readable formats for...

Suggested Considerations

• Map all current allocation and confirmation workflows and identify any use of non‑electronic, non‑standardised or non‑machine‑readable communication (including email attachments, faxes, PDFs, and oral instructions).
• Develop and execute a remediation plan to replace manual or oral allocation and confirmation processes with fully electronic, machine‑readable workflows using recognised international messaging standards.
• Review and update front‑to‑back trade processing systems (OMS, EMS, middle‑office, back‑office, matching engines) to ensure they can generate, receive and process standardised electronic allocation and confirmation messages within same‑day T+1‑compatible timelines.
• Engage with CSDs, custodians, brokers, counterparties and third‑party vendors to confirm their roadmap and readiness for the mandated electronic standards and to align implementation timelines to the 7 December 2026 application date.
• Update contractual documentation with clients and counterparties (including terms of business and service level agreements) to incorporate obligations for electronic, standardised, machine‑readable allocations and confirmations and to remove reliance on manual methods except as contingency.

Key Dates

References

• [1] esma.europa.eu/press-news/esma-news/esma-proposes-key-ref...
• [2] gfma.org/wp-content/uploads/2023/12/esma_cp1_sett_gfmas-g...
• [3] icmagroup.org/News/news-in-brief/icma-responds-to-esmas-c...
• [4] esma.europa.eu/esmas-activities/markets-and-infrastructur...
• [5] marketsmedia.com/esma-proposes-settlement-reforms-for-t1/
• [6] cssf.lu/en/t1-settlement-preparing-for-the-future-of-euro...
• [7] esma.europa.eu/sites/default/files/2025-06/High-level_Roa...
• [8] esma.europa.eu/sites/default/files/2025-10/ESMA74-2119945...

What Changed

• - The Bank of England has opened a BEEDS UAT environment specifically for testing statistical submissions under Statistical Taxonomy v1.3.1 FINAL, distinct from the BEEDS LIVE production environment.
• A dedicated UAT window is set from 02 June to 12 June 2026, during which the UAT environment will run in parallel with live reporting for some firms and returns.
• Statistical reporting firms are automatically enabled for BEEDS UAT using their existing BEEDS LIVE firm and user information and do not need to request UAT access.
• Software houses that wish to use this UAT window must request access by emailing the BEEDS queries mailbox by a stated cut‑off date (25 May 2026).
• All principal and additional user details for firms will be mirrored from the BEEDS LIVE environment into BEEDS UAT, with UAT‑specific temporary passwords issued from the designated BEEDS UAT email...

Suggested Considerations

• Identify all Bank of England statistical returns in scope of Taxonomy v1.3.1 and confirm that internal reporting calendars and responsibilities reflect the end‑May 2026 effective period and mid‑June 2026 submission deadlines.
• Ensure that all in‑scope statistical reporting firms’ BEEDS LIVE user and firm information are accurate and up to date, so that automatic mirroring into the BEEDS UAT environment creates correct and controlled user profiles.
• Instruct software houses and third‑party vendors supporting Bank of England statistical reporting to request BEEDS UAT access by emailing the BEEDS queries mailbox no later than 25 May 2026 if they intend to participate in this UAT window.
• Coordinate with internal IT and vendors to schedule, prepare, and execute test submissions in BEEDS UAT between 02 June and 12 June 2026, covering all relevant entry points and reporting scenarios under Taxonomy v1.3.1.
• Implement or validate an alternative XBRL generation solution to replace the withdrawn Bank of England Statistical Utility Tool, and complete end‑to‑end testing (source data to BEEDS receipt) ahead of the mid‑June 2026 live submission deadline.

Key Dates

References

• [1] einpresswire.com/article/897170046/statistical-notice-202...
• [2] bankofengland.co.uk/statistics/notice/2025/statistical-no...
• [3] bankofengland.co.uk/-/media/boe/files/statistics/data-col...
• [4] bankofengland.co.uk/statistics/notice/2026/statistical-no...
• [5] whistlebrook.co.uk/april-2025-regulation-update/
• [6] einnews.com/pr_news/875031117/statistical-notice-2025-06-...
• [7] bankofengland.co.uk/statistics/data-collection/statistica...
• [8] xbrl.org/news/bank-of-england-publishes-final-statistical...

What Changed

• - The Hong Kong Government and SFC have confirmed that dedicated regulatory regimes for VA advisory services and VA management services will be created under the Anti-Money Laundering and...
• The regulatory scope and standards of the VA advisory regime will be aligned with Type 4 “advising on securities” regulated activity under the Securities and Futures Ordinance, applying a “same...
• The regulatory scope and standards of the VA management regime will be aligned with Type 9 “asset management” regulated activity under the Securities and Futures Ordinance, implying broadly...
• The consultation received broad market support across 51 responding stakeholders, and the SFC has treated this as a mandate to proceed to finalisation of the detailed legislative proposals and...
• The new VA advisory and management regimes will sit alongside existing and proposed VA regimes for: VA trading platforms, stablecoin issuers, VA dealing and VA custody, forming an end-to-end...

Suggested Considerations

• Conduct a gap analysis comparing current or planned virtual asset advisory and management activities against Type 4 and Type 9 requirements under the Securities and Futures Ordinance to identify where equivalent capabilities, controls and governance will be required under the new VA regimes.
• Map all group entities and business lines that provide VA-related advice, research, recommendations or portfolio management to clients in or from Hong Kong, and determine which entities will need licensing or authorisation under the forthcoming AMLO-based regimes.
• Initiate early engagement with the SFC (e.g. via pre-application meetings or WINGS enquiries) to clarify how existing licences, business models and cross-border arrangements will be treated under the new VA advisory and management regimes.
• Review and, where necessary, enhance AML/CTF frameworks, including customer due diligence, transaction monitoring, sanctions screening and ongoing review procedures, to ensure they are robust enough for VA-specific risks anticipated under AMLO-based regulation.
• Update internal policies and procedures on suitability, product due diligence, risk disclosure, conflicts of interest and best execution to explicitly cover VA advisory and VA management services in line with standards applied to traditional securities and funds.

Key Dates

References

• [1] gibsondunn.com/wp-content/uploads/2022/04/hong-kong-sfc-p...
• [2] sfc.hk/en/
• [3] wings.sfc.hk
• [4] sfc.hk/TC/
• [5] ecp2.hkex.com.hk/landingsfc
• [6] apps.hkma.gov.hk/eng/index.php?c=search&m=search_by_name

What Changed

• - The CBI formally recognises tokenisation and shared, programmable ledgers as a likely core infrastructure of the future financial system and signals that regulation will evolve to treat tokenised...
• The speech confirms that CBI’s regulatory approach will be “technology‑neutral but not technology‑blind”, indicating that existing EU and Irish rules (e.g.
• The CBI emphasises the need to keep central bank money at the core of tokenised finance, aligning its stance with Eurosystem work on wholesale and retail central bank digital currency (CBDC) and...
• The speech reinforces that tokenised instruments representing traditional financial assets (securities, deposits, fund units) will generally be treated as regulated financial instruments, triggering...
• The CBI highlights operational resilience, cyber risk, interoperability and smart‑contract governance as critical supervisory focus areas for tokenised finance infrastructure and platforms.

Suggested Considerations

• Map all current and planned tokenisation and DLT initiatives (including pilots and proofs of concept) across the group and identify which EU and Irish regulatory regimes they fall under (MiFID II, UCITS, AIFMD, CRR/CRD, PSD2/PSR, Solvency II, MiCA, DORA, etc.).
• Perform a regulatory gap analysis to confirm that tokenised products and services are fully captured within existing licensing permissions and assess whether any variation of permission, new authorisation, or recognition as a market infrastructure is required.
• Review and update governance arrangements so that boards and senior management explicitly oversee tokenisation strategies, risk appetite, and the use of DLT, including ensuring clear allocation of responsibilities under the firm’s senior manager or fitness and probity framework.
• Integrate tokenisation‑specific risks into the firm’s risk management framework, covering legal enforceability of tokens, smart‑contract risk, cyber and operational resilience, data integrity, interoperability, concentration risk in technology providers, and settlement and counterparty risk.
• Review outsourcing and third‑party risk management frameworks to ensure that DLT platform providers, smart‑contract developers, node operators and custodians are treated as critical or important outsourced service providers where appropriate, with robust contractual, oversight and exit provisions.

Key Dates

References

• [1] centralbank.ie/news/article/press-release-discussion-pape...
• [2] youtube.com/watch?v=OuSFC9tp3r4
• [3] fsb.org/uploads/P221024-2.pdf
• [4] bis.org/speeches/sp251128.pdf
• [5] ecb.europa.eu/press/key/date/2026/html/ecb.sp260415~868b5...
• [6] moodys.com/web/en/us/insights/podcasts/credit-currents/to...
• [7] jbs.cam.ac.uk/wp-content/uploads/2026/02/2026-ccaf-tokeni...
• [8] chainalysis.com/financial-institutions/

What Changed

• - The decision reiterates and operationalises the definition of “inside information” under the EU Market Abuse Regulation (MAR, Regulation (EU) No 596/2014), confirming that information relating to a...
• The Enforcement Committee shows that it will infer possession and use of inside information from a combination of factors (plausible transmission channels, atypical trading patterns, timing around...
• The decision confirms that the use of inside information through trading on own account and on the account of closely related persons (spouse, parent) will be treated as separate instances of misuse...
• The Committee explicitly treats recommendations to invest made on the basis of inside information as a distinct form of insider dealing, exposing the recommender to sanctions even if they do not...
• The ruling reinforces that relatives and close associates (here, cousins) who act on such recommendations can be sanctioned for insider dealing, even when they are not employees or insiders of the...

Suggested Considerations

• Review and update MAR market abuse policies to explicitly cover the prohibition on recommending or inducing others to trade on the basis of inside information, including for non-staff related persons.
• Enhance insider dealing surveillance scenarios to capture atypical trading patterns before takeover or M&A announcements, including trading by retail clients and accounts linked to employees’ family members where identifiable.
• Tighten procedures for the management of inside information during corporate transactions (takeovers, mergers, acquisitions), including clear designation of insiders, controlled information flows, and logging of who is aware of pending deals.
• Strengthen controls around potential transmission channels for inside information, including guidance and monitoring for staff who may informally share information with relatives or friends, and explicitly prohibit such behaviour in codes of conduct.
• Provide targeted MAR training to staff, senior management, and high‑risk functions (M&A, corporate finance, strategy, legal, finance) that uses this case as an example of how the AMF infers insider dealing and the consequences for both insiders and relatives.

Key Dates

References

• [1] amf-france.org/en/news-publications/news-releases/amf-new...
• [2] amf-france.org/en/news-publications/news-releases/enforce...
• [3] amf-france.org/en/news-publications/news-releases/enforce...
• [4] amf-france.org/en/news-publications/news-releases/enforce...
• [5] amf-france.org/en/news-publications/news-releases/enforce...
• [6] amf-france.org/en/news-publications/news-releases/enforce...
• [7] amf-france.org/en/news-publications/news-releases/enforce...
• [8] amf-france.org/en/news-publications/news-releases/enforce...

What Changed

• - Circular IML 91/75, which set out rules for Luxembourg undertakings governed by the Law of 30 March 1988 on undertakings for collective investment, is repealed in full with effect from 22 May 2026...
• All amendments to Circular IML 91/75 introduced by Circulars CSSF 05/177, 18/697, 21/790, 22/811 and 25/901 are implicitly repealed as part of the repeal of IML 91/75 itself.
• The regulatory expectations previously contained in IML 91/75 are now either superseded by later Luxembourg fund laws (including post‑1988 UCI legislation and regimes for SICARs and SIFs), later CSSF...
• The historical link to the Law of 30 March 1988 on undertakings for collective investment is effectively severed at circular level, confirming that the operative framework is now the modern suite of...
• IML 91/75 is flagged as archived by the CSSF as of 22 May 2026, clarifying that it has no continuing normative or interpretative value as a live supervisory instrument.

Suggested Considerations

• Identify and inventory all internal and external documents (including policies, procedures, compliance manuals, prospectuses, offering documents, service agreements and SLAs) that reference Circular IML 91/75 or its amending Circulars CSSF 05/177, 18/697, 21/790, 22/811 and 25/901.
• Remove or replace all references to Circular IML 91/75 and its amending circulars in compliance frameworks, manuals, registers of applicable rules and control libraries, ensuring they are mapped instead to the current applicable UCI, SIF, SICAR, AIFM and relevant CSSF circulars.
• Perform a gap analysis to confirm that all substantive topics previously governed by IML 91/75 in your framework are now fully covered by current Luxembourg laws, EU fund regulations and up‑to‑date CSSF circulars and FAQs.
• Update training materials and onboarding content for compliance, portfolio management, risk and operations staff to reflect that IML 91/75 has been repealed and to direct staff to the current legal and regulatory sources governing UCIs and alternative funds.
• Adjust internal audit and compliance monitoring programs so that any test steps or key controls referencing IML 91/75 are updated to reference the applicable current provisions and CSSF administrative practice.

Key Dates

References

• [1] cssf.lu/en/2026/05/repeal-of-circular-iml-91-75/

What Changed

• - Circular IML 91/75, including its amendments by Circulars CSSF 05/177, 18/697, 21/790, 22/811 and 25/901, is formally repealed by Circular CSSF 26/912.
• The rules on “revision and remodelling of the rules to which Luxembourg undertakings governed by the Law of 30 March 1988 on undertakings for collective investment are subject” no longer form part of...
• Supervisory expectations for Luxembourg UCIs are now to be derived exclusively from the current UCI regime (notably the Law of 17 December 2010 relating to undertakings for collective investment and...
• Any internal compliance mappings, policy references, or control frameworks that still cite Circular IML 91/75 or its amending circulars must be treated as referencing repealed guidance and should be...

Suggested Considerations

• Update your regulatory inventory and obligation registers to reflect that Circular IML 91/75 and its amending circulars (CSSF 05/177, 18/697, 21/790, 22/811 and 25/901) have been repealed by Circular CSSF 26/912 as of 22 May 2026.
• Verify that your compliance monitoring programmes and internal audit test plans do not rely on requirements sourced from Circular IML 91/75, and re-align any such tests to the currently applicable legal and regulatory standards.
• Communicate the repeal of Circular IML 91/75 internally to legal, compliance, risk, product, and fund administration teams to prevent continued reliance on obsolete rules in ongoing or future projects.
• For any ongoing remediation, authorisation or approval processes that previously cited IML 91/75 as justification for a control design, reassess and document those controls against the current CSSF requirements that have effectively replaced or superseded the 1991 framework.
• Maintain an audit trail evidencing the update of documentation and registers in response to Circular CSSF 26/912, including board or senior management notification where your governance framework requires it for changes in regulatory obligations.

Key Dates

References

• [1] bdo.lu/en-gb/insights-en/advisory-en/cssf-circular-26-906...
• [2] pwc.lu/en/newsletter/2026/cssf-circular-26-906-in-focus.html
• [3] cssf.lu/en/2026/05/repeal-of-circular-iml-91-75/
• [4] klgates.com/Luxembourgs-CSSF-Circular-26/906-on-Central-A...
• [5] cssf.lu/en/Document/circular-cssf-26-912/
• [6] cms.law/en/lux/legal-updates/circular-cssf-26-906-compile...
• [7] loyensloeff.com/insights/news--events/news/circular-cssf-...
• [8] cssf.lu/en/Document/circular-cssf-26-904/

What Changed

• - The conviction reinforces the SFC’s enforcement position that “counselling or procuring” another person to trade, including a close family member, while in possession of inside information...
• The case highlights that use of personal communication channels (e.g., WhatsApp) to direct trading can be decisive evidence in insider dealing prosecutions, increasing expectations that firms monitor...
• The conviction confirms that controlling shareholders and chairpersons of Hong Kong–listed companies are expected to treat negotiations for disposal of control stakes, memoranda of understanding...
• The SFC has publicly quantified the estimated illicit profits (over HK$1 million) earned via the relative’s trading, signalling a continued focus on disgorgement and benefit analysis in enforcement...
• The case continues the SFC’s trend of using criminal prosecution, rather than solely civil Market Misconduct Tribunal proceedings, for insider dealing involving abuse of senior positions and close...

Suggested Considerations

• Review and update insider dealing and market misconduct policies to explicitly cover “counselling or procuring” trading by family members, nominees, and other connected persons, in line with Part XIII and Part XIV of the Securities and Futures Ordinance (Cap. 571).
• Update staff and director training materials to include concrete examples of prohibited conduct, including funding relatives’ accounts and giving trading instructions via messaging apps while in possession of inside information about control transactions, MOUs, or earnest money arrangements.
• Strengthen personal account dealing policies to require pre‑clearance and enhanced scrutiny for trades in securities of issuers where the employee, director, or major shareholder is directly or indirectly involved in control stake negotiations or other price‑sensitive corporate events.
• Implement or enhance procedures to identify and log potential inside information events (such as MOUs for stake sales, receipt of earnest money, or other significant transaction milestones) and to trigger trading blackouts for relevant insiders and their close associates.
• Conduct targeted thematic reviews of recent and ongoing corporate finance mandates and control stake transactions handled by the firm to identify any gaps in information barriers, wall‑crossing procedures, or monitoring of insiders’ and their relatives’ trading activities.

Key Dates

References

• [1] scmp.com/business/article/3300417/sfc-starts-insider-case...
• [2] fxnewsgroup.com/forex-news/regulatory/hk-regulator-commen...
• [3] english.dotdotnews.com/a/202508/26/AP68ad23a4e4b08d290534...
• [4] apps.sfc.hk/edistributionWeb/gateway/EN/news-and-announce...
• [5] sfc.hk/en/SFC-Search/Search?text=Pak&ui_lang=tc

What Changed

• - The PRA confirms an increase in the third‑country branch subsidiarisation threshold for liabilities covered by the Financial Services Compensation Scheme (FSCS) from £500 million to £600 million,...
• Third‑country branch undertakings are now explicitly required to notify the PRA where projections show their FSCS‑covered liabilities may exceed the £600 million subsidiarisation threshold within a...
• The PRA embeds in the Rulebook new quantitative thresholds for regulatory reporting, replacing the existing modification by consent (MbC) under Solvency II Reporting 2.2(1) for third‑country...
• Under the new regime, only branches (excluding pure reinsurance branches) with at least £1 billion gross written premiums or £2 billion in branch provisions (based on the prior year’s annual...
• The PRA discontinues quarterly reporting for certain non‑life claims templates and reinstates two annual reporting templates (IR.19.01.01 – non‑life insurance claims and IR.20.01.01 – development of...

Suggested Considerations

• Assess current and projected FSCS‑covered UK branch liabilities against the new £600 million subsidiarisation threshold and implement or update a robust three‑year forecasting process to identify potential threshold breaches.
• Update internal PRA notification procedures and early‑warning triggers so that the branch informs the PRA promptly if forecasts show FSCS‑covered liabilities could exceed the £600 million threshold within three years.
• For branches approaching or exceeding the new threshold, initiate or refresh internal structural options analysis (branch vs subsidiary), including timeline, capital, governance, and operational impacts, and prepare for early engagement with the PRA on subsidiarisation expectations.
• Map gross written premiums and branch provisions against the new £1 billion GWP and £2 billion provisions reporting thresholds and determine whether the branch will be subject to the full or reduced suite of third‑country branch regulatory reporting templates from 31 December 2026.
• Redesign regulatory reporting processes, systems, and controls to align with the new reporting perimeter, including identifying which templates will be required, adjusting data capture, and ensuring capacity to produce reinstated templates IR.19.01.01 and IR.20.01.01 on an annual basis.

Key Dates

References

• [1] pwc.co.uk/industries/financial-services/understanding-reg...
• [2] hfw.com/insights/pra-consults-on-proposals-for-third-coun...
• [3] bankofengland.co.uk/prudential-regulation/publication/202...
• [4] bankofengland.co.uk/prudential-regulation/publication/202...
• [5] skadden.com/insights/publications/2024/01/chapter-3-cross...
• [6] centralbank.ie/docs/default-source/regulation/industry-ma...
• [7] eiopa.europa.eu/system/files/2019-06/gl_third_country_bra...

What Changed

• - OSFI is proposing targeted revisions to the existing Capital and Liquidity Treatment of Crypto‑asset Exposures (Banking) Guideline, rather than a wholesale rewrite, in order to better reflect...
• The draft changes would explicitly recognize cross‑exchange hedging for Group 2a crypto‑assets when the instruments are traded on regulated exchanges of traditional financial assets, allowing more...
• Under the proposal, banks’ market‑neutral strategies in Group 2a crypto‑assets would receive capital treatment that more closely reflects actual economic risk, reducing instances where only partial...
• No change is proposed to the risk weights applied to Group 2a crypto‑assets, meaning existing Group 2a capital charge levels remain intact under the draft revisions.
• No change is proposed to the eligibility of Group 2a crypto‑assets as collateral, so current collateral treatment and related haircuts remain unchanged by this consultation.

Suggested Considerations

• Assess whether your institution currently has, or plans to have, exposures to Group 2a crypto‑assets traded on regulated exchanges of traditional financial assets, and map all related positions, hedges, and trading strategies.
• Review existing market‑neutral and cross‑exchange hedging strategies for crypto‑asset exposures to determine how expanded recognition of cross‑exchange hedges could change risk‑weighted assets, leverage exposure, and liquidity metrics under OSFI’s proposed treatment.
• Perform an impact assessment and scenario analysis comparing existing capital and liquidity requirements for Group 2a exposures under the current guideline versus the proposed cross‑exchange hedge recognition, quantifying potential capital relief or shifts in capital allocation.
• Update internal capital policy documentation, trading desk procedures, and risk‑management standards to incorporate the proposed hedging recognition framework, including eligibility criteria for “regulated exchanges of traditional financial assets,” subject to final OSFI requirements.
• Prepare and submit a consultation response to OSFI by 20 July 2026, highlighting any operational, risk‑measurement, model, or documentation challenges with implementing cross‑exchange hedge recognition and recommending clarifications where needed.

Key Dates

References

• [1] osfi-bsif.gc.ca/en/about-osfi/multimedia-library/osfis-ca...
• [2] osfi-bsif.gc.ca/en/guidance/guidance-library/capital-liqu...
• [3] osfi-bsif.gc.ca/en/news/osfi-launches-consultation-regula...
• [4] youtube.com/watch?v=TfnKz7h5RIc
• [5] osfi-bsif.gc.ca/en/about-osfi/progress-our-initiatives/mo...
• [6] mcmillan.ca/insights/publications/osfi-allows-greater-cry...
• [7] osfi-bsif.gc.ca/en/guidance/guidance-library/capital-liqu...
• [8] osfi-bsif.gc.ca/en/guidance/guidance-library

What Changed

• - OSFI proposes to amend Guideline B‑12 – Interest Rate Risk Management to update prescribed interest rate shock scenarios used for measuring interest rate risk in the banking book.
• The interest rate shock calibration will be aligned with the most recent BCBS methodology for IRRBB, including improved treatment of environments where policy rates are close to zero or negative.
• The time series used to calibrate interest rate shock scenarios will be extended from a previous cut‑off of December 2015 to now incorporate data through December 2023, capturing the recent period of...
• OSFI intends to strengthen transparency and market discipline by consulting simultaneously on proposed amendments to Pillar 3 disclosure expectations related to interest rate risk in the banking book.
• The revised B‑12 guideline will introduce updated expectations for IRR measurement, monitoring, and reporting that ensure institutions recognize more recent market experience in their internal risk...

Suggested Considerations

• Perform a gap analysis comparing current interest rate risk in the banking book methodologies, shock scenarios, and assumptions against the proposed revised Guideline B‑12 parameters and BCBS‑aligned calibration approach.
• Engage internal stakeholders (risk management, treasury/ALM, finance, regulatory reporting, model validation, and internal audit) to review the consultation text and identify operational, data, and model impacts from the extended December 2015–December 2023 calibration window and new shock design.
• Prepare and submit a detailed written response to OSFI at Consultations@osfi-bsif.gc.ca by 20 July 2026, highlighting any concerns with scenario calibration, procyclicality, data availability, systems impacts, and implementation timelines.
• Update IRRBB models, interest rate scenario engines, behavioral assumptions (e.g., non‑maturity deposits, prepayments), and risk metrics (e.g., economic value of equity and earnings‑at‑risk) to incorporate the revised OSFI shock scenarios once the final guideline is published on 10 September 2026.
• Revise internal IRRBB policies, risk appetite statements, limits frameworks, and governance documentation to align with the updated Guideline B‑12 expectations and ensure Board and senior management oversight reflects the new calibration.

Key Dates

References

• [1] osfi-bsif.gc.ca/en
• [2] en.wikipedia.org/wiki/Office_of_the_Superintendent_of_Fin...
• [3] publications.gc.ca/collections/collection_2012/bsif-osfi/...

What Changed

• - Extends the scope of Guideline B‑2 (Large Exposure Limits) beyond domestic systemically important banks (DSIBs) to include Category 1 and Category 2 small and medium‑sized banks (SMSBs), bringing...
• Replaces the existing 1994 large exposure guideline for Category 1 and Category 2 SMSBs with a single modern framework aligned to the January 2019 version of Guideline B‑2.
• Removes Category 3 SMSBs from the large exposure guideline regime, so they will no longer be subject to OSFI large exposure limits under Guideline B‑2.
• Removes foreign bank branches from the scope of the large exposure guideline, so foreign bank branches will no longer be subject to Guideline B‑2 requirements.
• Introduces a hard limit for Category 1 and Category 2 SMSBs that total exposures to a single counterparty or group of connected counterparties must not exceed 25% of the institution’s Tier 1 capital.

Suggested Considerations

• Conduct an impact assessment to quantify current single‑name and connected‑counterparty exposures relative to the proposed 25% of Tier 1 capital limit for Category 1 and Category 2 SMSBs.
• Identify and map all existing large exposure policies, procedures, and limits that are based on the 1994 large exposure guideline and plan their replacement with a framework aligned to the 2019 Guideline B‑2 approach.
• Review and, where necessary, redesign methodologies and internal criteria for identifying groups of connected counterparties so they are consistent with OSFI’s updated expectations under the draft revised Guideline B‑2.
• Update credit risk measurement processes and systems so that exposures for large exposure purposes are calculated net of eligible credit risk mitigation in line with OSFI capital requirements.
• Assess data, systems, and reporting capabilities to ensure the institution can produce quarterly large exposure reports using the same template as larger banks, including drill‑downs by counterparty and connected counterparty groups.

Key Dates

References

• [1] osfi-bsif.gc.ca/en/news/save-date-osfis-second-quarterly-...
• [2] newswire.ca/news-releases/osfi-s-quarterly-release-streng...
• [3] osfi-bsif.gc.ca/en/about-osfi/progress-our-initiatives/mo...
• [4] mcmillan.ca/wp-content/uploads/2024/03/GLI-BR24_Chapter-4...
• [5] osfi-bsif.gc.ca/en/guidance/guidance-library
• [6] bis.org/bcbs/publ/d473.pdf
• [7] osfi-bsif.gc.ca/en/guidance/guidance-library/climate-risk...

What Changed

• - The CFTC Division of Enforcement has adopted a new, unified cooperation policy that expressly supersedes all prior Division cooperation and self‑reporting advisories (including the 2017 corporate...
• The new advisory establishes a clear “declination pathway” under which, absent aggravating circumstances, a respondent that voluntarily self‑reports, fully cooperates, timely and appropriately...
• The advisory formalizes that voluntary self‑reporting is a central prerequisite for the highest level of credit, distinguishing between cases with self‑reports (potential declination or high...
• The policy confirms that “full cooperation” will be a necessary condition for a declination, which in practice will require proactive, resource‑intensive engagement with Enforcement beyond mere...
• The advisory codifies that timely and appropriate remediation is a separate and indispensable requirement for top‑tier outcomes, emphasizing that firms must implement corrective measures before...

Suggested Considerations

• Identify and catalogue all existing internal policies, playbooks, and checklists relating to CFTC investigations, dawn raids, inquiries, self‑reporting, and cooperation, and amend them to reflect the new advisory’s superseding status.
• Update the firm’s enforcement‑response framework to explicitly incorporate the new declination pathway, including clear decision criteria for when and how to voluntarily self‑report potential CFTC violations.
• Establish or refine escalation triggers for potential insider trading, fraud, manipulation, and market abuse in CFTC‑regulated markets to ensure that issues can be investigated and elevated quickly enough to support “prompt” and “voluntary” self‑reporting.
• Design and document a structured internal investigation protocol that can generate the level of factual development, analysis, and documentation needed to demonstrate “full cooperation,” including protocols for sharing findings, data, and analytics with the CFTC where appropriate.
• Implement procedures to rapidly secure, preserve, and collect relevant trading records, communications (including messaging apps), surveillance alerts, and algorithmic trading data so that the firm can cooperate effectively and avoid any appearance of obstruction or delay.

Key Dates

References

• [1] jdsupra.com/legalnews/cftc-s-division-of-enforcement-issu...
• [2] cliffordchance.com/content/dam/cliffordchance/briefings/2...
• [3] skadden.com/-/media/files/publications/2020/11/cftc-issue...
• [4] sidley.com/en/insights/newsupdates/2025/03/us-cftc-enforc...
• [5] cftc.gov/media/11821/EnfAdv_Resolutions022525/download
• [6] cftc.gov/PressRoom/PressReleases
• [7] morganlewis.com/pubs/2025/03/cftc-enforcement-replaces-pr...
• [8] cftc.gov/sites/default/files/idc/groups/public/@lrenforce...

What Changed

• *(Based on the SEC’s description and consistent with prior offering‑reform initiatives; specific rule and form cites will need to be confirmed against the proposing release once reviewed in full.)*
• The SEC proposes to modernize the shelf registration process for Form S‑3 and F‑3 issuers, including expanded use of automatic or “universal” shelves and greater flexibility to add classes of...
• The proposal would streamline incorporation by reference, allowing more categories of Exchange Act reports and exhibits to be incorporated into Securities Act registration statements and prospectuses...
• The SEC proposes to expand the use of “access equals delivery” for final prospectuses, permitting issuers in additional circumstances to satisfy Securities Act Section 5(b)(2) delivery requirements...
• The reforms would broaden the range of permissible communications in connection with registered offerings, including issuer and underwriter use of certain factual and forward‑looking information,...

Suggested Considerations

• Monitor the Federal Register and SEC website for the full proposing release text and the precise comment deadline for this rulemaking.
• Coordinate among legal, finance, and investor relations teams to prepare and submit a comment letter to the SEC addressing practical implications of the proposed offering and reporting reforms for your issuer, including any concerns about liability, operational feasibility, and investor impact.
• Inventory all existing shelf registration statements (including automatic shelves), universal shelves, and continuous‑offering programs and identify where proposed changes to shelf mechanics, incorporation by reference, or prospectus updating could affect structure, timing, or disclosure.
• Review current offering communication practices, including use of free writing prospectuses, roadshow materials, and research reports, and map them against the proposed expanded communications safe harbors to determine what additional flexibilities could be used in future offerings.
• Assess your firm’s use of Exchange Act reports incorporated by reference into Securities Act registration statements and plan to revise drafting and review procedures to take advantage of streamlined incorporation while managing Securities Act liability for incorporated information.

Key Dates

References

• [1] akingump.com/en/insights/alerts/sec-proposes-changes-to-r...
• [2] proskauer.com/alert/sec-proposes-reforms-for-business-dev...
• [3] sec.gov/files/rules/final/33-8591.pdf
• [4] skadden.com/insights/publications/2026/2026-insights/regu...
• [5] sec.gov/resources-small-businesses/small-business-complia...
• [6] sec.gov/rules-regulations/rulemaking-activity
• [7] scholarship.law.duke.edu/cgi/viewcontent.cgi?article=1182...
• [8] sullcrom.com/SullivanCromwell/_Assets/PDFs/Memos/SC-Publi...

What Changed

• - Circular CSSF 26/911 replaces Circular CSSF 25/877 and integrates ESMA’s 2025 Guidelines on stress test scenarios under Article 28 of Regulation (EU) 2017/1131 (MMFR), making the updated scenarios...
• The 2025 ESMA Guidelines (Ref. ESMA50-481369926-30585) update the common reference stress test parameters for MMFs, reflecting more recent market conditions and liquidity risk drivers than the 2024...
• The circular clarifies that MMFs and MMF managers must use the updated 2025 ESMA stress test scenarios when preparing the MMF reporting required under the MMFR and the related Commission Implementing...
• Circular CSSF 26/911 confirms that the 2025 Guidelines and their translations, published by ESMA on 26 March 2026, are now integrated into CSSF supervisory practice, following the ESMA process...
• The circular reiterates that MMFs and their managers must tailor the ESMA reference scenarios to the specificities of each MMF, adding additional risk factors or requirements where needed to ensure...

Suggested Considerations

• Identify all MMFs and MMF mandates in scope of Regulation (EU) 2017/1131 for which the CSSF is the competent authority and confirm that they are currently using the 2024 ESMA stress test framework under Circular CSSF 25/877.
• Obtain and review in detail the ESMA 2025 Guidelines on stress test scenarios (ESMA50-481369926-30585) and the annexed parameters as integrated by Circular CSSF 26/911, comparing them line‑by‑line to the 2024 version to map all methodological and parameter changes.
• Update the MMF stress testing policy and procedures to reference Circular CSSF 26/911 and the 2025 ESMA Guidelines, including explicit descriptions of the scenarios, calibration choices, modelling techniques, and governance for scenario approval.
• Recalibrate stress testing models and tools used for MMFs to reflect the 2025 common reference parameters, ensuring that interest rate shocks, credit spread moves, liquidity shocks, redemption scenarios, and concentration risks are aligned with the new ESMA specifications.
• Perform impact analyses on representative MMFs using both 2024 and 2025 parameters to quantify changes in stress outcomes, and prepare internal briefing materials for senior management and boards explaining the impacts on liquidity and risk profiles.

Key Dates

References

• [1] bdo.lu/en-gb/insights-en/advisory-en/cssf-circular-26-906...
• [2] cssf.lu/wp-content/uploads/cssf26_911eng.pdf
• [3] loyensloeff.com/insights/news--events/news/circular-cssf-...
• [4] klgates.com/Luxembourgs-CSSF-Circular-26/906-on-Central-A...
• [5] pwc.lu/en/newsletter/2026/cssf-circular-26-906-in-focus.html
• [6] cms.law/en/lux/legal-updates/circular-cssf-26-906-compile...
• [7] cssf.lu/en/Document/circular-cssf-26-904/
• [8] cssf.lu/en/Document/circular-cssf-26-909/

What Changed

• - The SEC has rescinded the policy in Rule 202.5(e) of its informal Rules of Practice that conditioned settlements involving sanctions on the respondent’s agreement not to publicly deny the...
• Settling parties in SEC enforcement actions may now have greater scope to make public statements that deny or contest aspects of the SEC’s allegations, subject to the specific language of each...
• The traditional “neither admit nor deny” construct will no longer automatically include a built‑in prohibition on denials, which means the SEC staff will need to negotiate any desired limitations on...
• Communications and disclosure provisions in SEC settlement papers (including “undertakings” and clauses governing press releases and investor communications) are likely to become more tailored and...
• The rescission increases the importance of alignment between legal, compliance, and communications teams when crafting public statements following an SEC settlement, because statements that deny...

Suggested Considerations

• Review existing internal playbooks for handling SEC investigations and settlements and update them to reflect the rescission of Rule 202.5(e), including how settlement language on admissions, denials, and public statements is negotiated.
• For matters currently under SEC investigation or in active settlement negotiations, direct outside and in‑house counsel to reassess settlement strategy, including whether to seek greater flexibility for post‑settlement denials or clarifications in the consent language and undertakings.
• Conduct an inventory of significant historical SEC settlements that included “no‑deny” provisions and identify where ongoing communications plans, disclosure narratives, or litigation strategies may be constrained by legacy language.
• For high‑impact historical orders with restrictive “no‑deny” clauses, obtain legal advice on whether and how to approach the SEC about potential modification or clarification of those provisions in light of the Commission’s changed policy.
• Train senior management, board members, and spokespersons on the revised SEC posture, emphasising that while denials may now be more permissible, inaccurate or overly aggressive denials could adversely affect ongoing private litigation, insurance recoveries, or relationships with other regulators.

Key Dates

References

• [1] sec.gov
• [2] usgovernmentmanual.gov/Agency?EntityId=JZfpg7xXgFk%3D&Par...
• [3] sec.gov/newsroom/press-releases/2024-174
• [4] sec.gov/newsroom/press-releases/2024-148
• [5] sec.gov/newsroom/press-releases/2024-98
• [6] sec.gov/newsroom/press-releases/2025-6
• [7] sec.gov/enforcement-litigation/litigation-releases
• [8] sec.gov/reports

What Changed

• - The UK Government has confirmed a programme to reform the Consumer Credit Act 1974, moving away from detailed prescriptive legislative requirements towards a more flexible framework based on FCA...
• The FCA has stated its intention to consult on “key elements” of the consumer credit framework that are currently in primary or secondary legislation, where it has the power to do so, covering the...
• The Consumer Duty (Principle 12, PRIN 2A) is explicitly confirmed as the overarching framework for the future consumer credit regime, meaning consumer credit firms will be expected to demonstrate...
• The FCA has signalled that existing consumer rights and protections under the CCA (including cancellation and withdrawal rights, termination, and early settlement rights) will be reviewed and...
• Any new FCA rules arising from CCA reform will be supported by a formal cost–benefit analysis and shaped through stakeholder engagement, implying a structured consultation process (likely one or more...

Suggested Considerations

• Establish an internal CCA reform working group (legal, compliance, product, operations) to track HM Treasury and FCA publications on Consumer Credit Act reform and prepare coordinated responses.
• Map all existing product lines and customer journeys against current CCA and CONC requirements to identify areas most likely to be affected if obligations move from legislation into FCA rules (e.g. pre‑contract disclosure, notices of sums in arrears, default notices, early settlement calculations).
• Review your Consumer Duty implementation for consumer credit products (especially outcomes testing, fair value assessments and customer support processes) to ensure it can absorb additional or re‑framed requirements that may migrate from the CCA into the FCA Handbook.
• Compile an inventory of CCA‑dependent documentation (agreements, pre‑contract information, statutory notices, arrears and default letters, early settlement communications) and assess the effort required to update them if the form or content requirements are recast in FCA rules.
• Enhance regulatory horizon‑scanning processes to include systematic monitoring of HM Treasury CCA reform material and FCA consultations, ensuring early awareness of consultation questions and proposed Handbook text.

Key Dates

References

• [1] fca.org.uk/news/speeches/showing-financial-crime-red-card
• [2] fca.org.uk/news
• [3] fca.org.uk/consumers/protect-yourself-scams
• [4] fca.org.uk/news/news-stories/consumer-warning-binance-mar...
• [5] gov.uk/government/organisations/financial-conduct-authority
• [6] fca.org.uk
• [7] fca.org.uk/news/press-releases/fca-establishes-presence-u...
• [8] fca.org.uk/news/speeches/regulatory-perspective-and-prior...