November 2025 Regulatory Updates

What Changed

Indefinite exemption for equity options: Single-stock equity options and index options are permanently exempted from UK bilateral initial margin (IM) and variation margin (VM) requirements, replacing a temporary exemption ending 4 January 2026. This balances safety with international competitiveness, as capital can substitute for margin. Legacy contracts relief: Firms falling below the Average Aggregate Notional Amount (AANA) threshold no longer need to exchange IM on outstanding legacy non-cent

What You Need To Do

• Assess cross-border transactions
• Conduct gap analysis on margin calculations, collateral management, and reporting; train front-to-back office teams on changes
• Retain records of AANA calculations and threshold monitoring to justify exemptions or relief
• For firms with collected IM on now-exempt legacy positions, evaluate release options per updated FCA instrument language

Key Dates

References

• [1] regulationtomorrow.com
• [2] bankofengland.co.uk
• [3] fca.org.uk
• [4] thecompliancedigest.com
• [5] jdsupra.com
• [6] bis.org
• [7] simmons-simmons.com

What Changed

This is not a formal rule change but supervisory guidance via roundtable insights reinforcing SS1/23 principles (effective since 2023). Key emphases include: Risk appetite: Boards must articulate AI/ML-specific model risk appetite pre-deployment to avoid exceeding tolerances, given higher uncertainty from opacity. Model inventories and tiering: Address inaccurate/incomplete inventories and aggregate risks from deploying similar AI/ML across portfolios/jurisdictions; challenge tiering for complex

What You Need To Do

• Review and strengthen board-level model risk appetite statements to explicitly cover AI/ML opacity and uncertainty; integrate into governance triggers like re-validation
• Enhance model inventories for completeness, aggregate risk assessment, and cross-jurisdictional tiering challenges
• Update model development policies to evaluate AI/ML trade-offs (e
• Revise ongoing monitoring policies for more frequent, quantitative checks on AI/ML (e
• Participate in PRA initiatives like MRM roundtables or AI Consortium for dialogue; align first/second-line defenses per SS1/23

Key Dates

References

• [1] bankofengland.co.uk
• [2] bankofengland.co.uk
• [3] validmind.com
• [4] articsledge.com
• [5] finextra.com
• [6] marcusevans.com
• [7] cdao-fall.coriniumintelligence.com
• [8] garp.org

What Changed

This is an enforcement action, not a rulemaking, so there are no new regulatory changes or requirements. It reinforces longstanding CEA and CFTC rules on: Mandatory registration as a Commodity Pool Operator (CPO) and Associated Persons (APs) for pools trading commodity futures (CFTC Regulation 4.13 exemptions do not apply here due to fraud and public solicitation). Prohibitions on fraud, misrepresentations, guarantees of profit, non-disclosure of risks, commingling funds, and operating pools as

What You Need To Do

• Verify registration
• Implement controls
• Conduct due diligence
• Train staff
• For SEC-registered advisers

Key Dates

References

• [1] cftc.gov
• [2] cftc.gov
• [3] sidley.com
• [4] ropesgray.com
• [5] cftc.gov
• [6] haynesboone.com
• [7] cftc.gov
• [8] alston.com

What Changed

New fee structures: Introduction of a periodic fee block for PISCES operators based on regulated income (baseline £2,200 annual fee, variable above £500,000 threshold); extension of fee-block A.13 to include "targeted support" activities (Category 2 variation fee for existing firms, Category 4 for new entrants); registration fees for Deferred Payment Credit (DPC/buy-now-pay-later) activities aligned with Temporary Permissions Regime, added to FOS consumer credit fee-block but excluded from FSCS.

What You Need To Do

• Review current fee/levy exposure and model impacts of new blocks (e
• Assess invoice processes if paying £50,000+ in FCA/PRA fees; prepare for aligned due dates
• Submit consultation responses by deadlines, focusing on targeted support by 9 January 2026
• Budget for potential fee increases; monitor Spring 2026 fee-rates CP
• For applicants

Key Dates

References

• [1] fca.org.uk
• [2] jdsupra.com
• [3] regulationtomorrow.com
• [4] bankofengland.co.uk
• [5] finreg.aoshearman.com
• [6] policymogul.com
• [7] lexisnexis.co.uk
• [8] bankofengland.co.uk

What Changed

This is an enforcement action, not a rulemaking, so there are no new regulatory changes or requirements. It reaffirms existing CEA prohibitions on fraud, including Section 6(c)(1), 7 U.S.C. § 9(1), and 17 C.F.R. § 180.1(a)(1)-(3), covering material misrepresentations, omissions, and deceptive schemes in precious metals sales. Key takeaways include joint-and-several liability for entities and controlling individuals (Ikahn held liable for not acting in good faith), systematic overcharges as fraud

What You Need To Do

• Conduct immediate fraud risk assessments on precious metals sales scripts, disclosures, and pricing markups to ensure no material misrepresentations or undisclosed overcharges
• Enhance senior investor protections, including suitability reviews, cooling-off periods, and training on vulnerable customer targeting bans
• Review controlling person policies for good faith oversight, documenting supervisory failures to avoid personal liability
• Audit parallel SEC/CFTC exposures in commodity-linked activities, preparing for offset calculations in multi-agency actions
• Update compliance manuals with this case as precedent for CEA fraud in physical commodities; monitor whistleblower notices for internal reporting incentives

Key Dates

References

• [1] cftc.gov
• [2] cftc.gov
• [3] whistleblower.gov
• [4] oag.maryland.gov
• [5] nasaa.org
• [6] cftc.gov
• [7] securities.utah.gov
• [8] finance.idaho.gov

What Changed

Increased Protection Limits: Standard FSCS deposit limit rises from £85,000 to £120,000; THB limit from £1 million to £1.4 million, applying to failures from 1 December 2025. SCV System Updates: Firms must update SCV systems (used by FSCS for rapid compensation) to reflect new limits from 1 December 2025, including accurate contact details. Disclosure Materials: - Update information sheets on FSCS cover to reflect new limits and improve clarity/accessibility; provide to depositors as soon as

What You Need To Do

• Immediate (pre-1 Dec 2025)
• By 1 Dec 2025
• Post-1 Dec 2025 to 31 May 2026
• Document changes for audit trails; consider regtech for SCV automation

Key Dates

References

• [1] connections.nortonrosefulbright.com
• [2] bankofengland.co.uk
• [3] regulationtomorrow.com
• [4] jdsupra.com
• [5] prarulebook.co.uk
• [6] lexisnexis.co.uk
• [7] macroglobal.co.uk

What Changed

The PRA is considering policy reforms centered on six core principles: *Capital Quality & Quantity**: Alternative life capital structures must not lower the quality or quantity of capital required to support insurance risks. *Risk Transfer Focus**: Structures should enable patient capital investment aligned with long-term liability profiles, allowing investors to forgo immediate returns for substantial future gains. *Capital Relief Priority**: Alternative life capital should predominantly del

What You Need To Do

• *For UK life insurers
• *Assess capital needs
• *Prepare consultation response
• *Engage with policy development
• *Assess structural readiness

Key Dates

References

• [1] bankofengland.co.uk
• [2] skadden.com
• [3] mayerbrown.com
• [4] skadden.com
• [5] bankofengland.co.uk
• [6] slaughterandmay.com
• [7] hoganlovells.com
• [8] regulationtomorrow.com

What Changed

This announcement itself introduces no new regulatory changes or requirements; it is a personnel update. However, it occurs amid broader Enforcement Division restructuring, including: Consolidation from one Deputy Director to four (three regional: Northeast, Southeast, West; one for specialized units), reducing reporting lines for a more unified nationwide enforcement program. Rescission in March 2025 of delegated authority for the Enforcement Director to issue formal orders of investigation, no

What You Need To Do

• Review ongoing Northeast Regional Office investigations for potential leadership changes and engage early with new deputies on cooperation opportunities
• Enhance internal self-reporting and remediation protocols to align with Enforcement's stated rewards for cooperation and robust Wells processes
• Update compliance training on restructured reporting lines and Commission-authorized formal orders, ensuring defenses stick to established securities laws rather than novel theories
• Monitor SEC staff directory for replacement announcements, such as potential roles for Samuel Waldon or others in the Northeast

Key Dates

References

• [1] mcguirewoods.com
• [2] sec.gov
• [3] dechert.com
• [4] corpgov.law.harvard.edu
• [5] skadden.com
• [6] perkinscoie.com
• [7] morganlewis.com
• [8] clearygottlieb.com

What Changed

Risk Adjustment Updates (Annex 2): Increases weight of 'Return on assets' (ROA) risk indicator from 7.5% to 10%; decreases 'Deposit-size Risk' from 15% to 12.5%; adjusts sliding scale bounds for indicators like leverage ratio (3%-9%), capital coverage ratio (100%-200%), LCR/NSFR (100%-200%), NPL ratio (0%-3%), and others per Table 2, aligning with minimum EBA Guidelines weights totaling 75% plus national flexibility. Formula Component Floor (Annex 1): Introduces a zero floor for Component 1 (max

What You Need To Do

• Review and update internal systems/models for contribution calculations to incorporate new risk weights, bounds (Table 2), zero floor for Component 1, and revised formulas in Annexes 1-2
• Validate data reporting for risk indicators (e
• Prepare for FGDL invoices reflecting compartment-specific rates; monitor covered deposits for surveys (e
• Conduct gap analysis against repealed circulars (20/21, 23/34); update policies for mergers, deposit changes, and gap fillings (Γ_λ)

References

• [1] cssf.lu
• [2] cssf.lu
• [3] cssf.lu
• [4] cssf.lu
• [5] cliffordchance.com
• [6] cssf.lu
• [7] cssf.lu
• [8] cssf.lu

What Changed

Modified Contribution Formula: Replaces prior methods (e.g., from Circulars CSSF-CPDI 16/01, 17/06, 20/21) with a new structure: Component 1 proportional to covered deposits growth (Γ_{j,k}) at 0.8% base rate, plus a flat add-on (T_j D_{j-2,k}) for target shortfalls, adjusted by a uniform factor μ per compartment, and multiplied by a new risk adjustment factor (ARW_{j,k}). Risk Adjustment Introduction: ARW is calculated using a weighted score (minimum 75% on EBA core categories, plus 12.5% depos

What You Need To Do

• Data Reporting
• Internal Calculations
• Risk Monitoring
• Systems Update

Key Dates

References

• [1] cssf.lu
• [2] cssf.lu
• [3] cssf.lu
• [4] cssf.lu
• [5] cssf.lu
• [6] fgdl.lu
• [7] cssf.lu
• [8] cssf.lu

What Changed

This is an enforcement action, not a regulatory change, but it clarifies and strengthens application of existing AMF rules for conseillers en investissements financiers (CIFs) under French regulations: Mandatory compliant documentation (e.g., investment proposals). Obligation to act honestly, fairly, and professionally in clients' best interests, including systems to prevent managers exploiting positions for undocumented investments. AML/CFT compliance, including prohibitions on directors receiv

What You Need To Do

• Audit documentation
• Strengthen governance
• Enhance AML/CFT
• Improve inspection readiness
• Senior manager reviews

Key Dates

References

• [1] amf-france.org
• [2] amf-france.org
• [3] steel-eye.com
• [4] amf-france.org
• [5] amf-france.org
• [6] amf-france.org
• [7] amf-france.org
• [8] amf-france.org

What Changed

Retail deposits threshold raised from £50 billion to £75 billion, adjusted upward from the CP2/25 proposal of £70 billion to account for further GDP growth to Q2 2025 (rounded to nearest £5 billion). Introduction of a three-year moving average for calculating retail deposits metric, replacing point-in-time values to mitigate volatility and aid capital planning, particularly for building societies. Non-UK assets threshold remains unchanged at £10 billion. Modifications by consent disapplying leve

What You Need To Do

• Review and update internal retail deposits calculations to incorporate three-year moving average methodology starting 1 January 2026
• Assess current and projected retail deposits against £75 billion threshold (and £10 billion non-UK assets) to determine leverage ratio applicability and adjust capital planning accordingly
• Prepare to meet 3
• For firms with modifications by consent
• Update governance, risk models, and board reporting to reflect changes; conduct gap analysis against PRA Rulebook appendices in PS22/25

Key Dates

References

• [1] regulationtomorrow.com
• [2] bankofengland.co.uk
• [3] bankofengland.co.uk
• [4] addleshawgoddard.com
• [5] jdsupra.com
• [6] lexisnexis.co.uk
• [7] jdsupra.com
• [8] innovatefinance.com

What Changed

The proposed regulatory regime introduces several material requirements for systemic stablecoin issuers: *Backing Asset Composition Systemic stablecoin issuers will be permitted to hold up to 60% of backing assets in short-term sterling-denominated UK government debt, with the remaining 40% held as deposits at the Bank of England. For stablecoins recognized as systemic at launch, a temporary "step-up" regime allows up to 95% of backing assets in UK government securities**, which would reduce to

What You Need To Do

• *For Systemic Stablecoin Issuers
• *Monitor and respond to consultation - Submit detailed comments on proposals before February 2026 deadline, particularly on:
• Alternative tools to achieve regulatory objectives
• Backing asset composition and holding limits
• Safeguarding regime design

Key Dates

References

• [1] skadden.com
• [2] mayerbrown.com
• [3] addleshawgoddard.com
• [4] bankofengland.co.uk
• [5] bankofengland.co.uk
• [6] reedsmith.com
• [7] whitecase.com
• [8] mofo.com

What Changed

This is an enforcement action, not new legislation, but it reinforces existing CJA 2010 requirements for VASPs: ongoing transaction monitoring, immediate STR filing to the Financial Intelligence Unit (FIU) and Revenue Commissioners upon suspicion of money laundering or terrorist financing, and adoption of internal policies/controls to prevent/detect financial crime. Key breaches included: misconfigured monitoring systems missing 30,442,437 transactions (31% of activity over 12 months); delayed r

What You Need To Do

• Conduct Gap Analysis
• Enhance Controls
• Accelerate STR Processes
• Board/Compliance Reporting
• Third-Party Review

Key Dates

References

• [1] wp.nyu.edu
• [2] centralbank.ie
• [3] flagright.com
• [4] centralbank.ie
• [5] centralbank.ie
• [6] pinsentmasons.com
• [7] vinciworks.com
• [8] coinbase.com

What Changed

Introduces new modules in the revised SAQ to align with supervisory points of focus, building on prior expansions (e.g., credit/counterparty risk, liquidity risk, climate-related risks from CSSF 23/845). Emphasizes REA's independent assessment in the AML/CFT report, requiring exhaustive, transparent evaluations of ML/FT risks across institutions, branches, majority-owned subsidiaries abroad, and tied agents; prohibits vague language (e.g., no "no serious weaknesses" phrasing) and mandates positi

What You Need To Do

• Complete and submit revised SAQ annually, incorporating new modules on supervisory focuses like ML/FT risks and providing detailed data to REA
• Authorized management
• Ensure AML/CFT report details methodologies (e
• Review prior LFR submissions against this update to align with suppressed redundancies and new emphases

Key Dates

References

• [1] cssf.lu
• [2] dlapiper.com
• [3] cssf.lu
• [4] ogier.com
• [5] cssf.lu
• [6] stradalex.lu
• [7] cssf.lu
• [8] cssf.lu

What Changed

The circular introduces a three-component reporting framework that fundamentally alters the compliance landscape: Self-Assessment Questionnaire (SAQ): A digital, annually-completed questionnaire that institutions must prepare directly, covering domains within CSSF and ECB prudential supervision competence Agreed Upon Procedures (AUP) Reports: Reports prepared by approved statutory auditors (réviseurs d'entreprises agréés) on specific compliance areas Separate REA Report on Financial Instruments

What You Need To Do

• *For Credit Institutions
• *Establish SAQ Governance
• *Data Preparation
• *Digital System Access
• *Module Completion

Key Dates

References

• [1] cssf.lu
• [2] pwc.lu
• [3] cssf.lu
• [4] cssf.lu
• [5] cssf.lu
• [6] dlapiper.com
• [7] stradalex.lu
• [8] cssf.lu

What Changed

CSSF 21/765: Updated provisions following amendments to CSSF Regulation No 12-02, refining notification and operational requirements for branches and FOPS. CSSF 22/827: Further amendments to align with CRD and MiFID II changes, including enhanced notifications for programme alterations (e.g., one-month prior written notice for changes in operations, services, or activities). CSSF 25/898: Latest update (noted in CSSF Newsletter No 298, November 2025), incorporating recent legal/regulatory develop

What You Need To Do

• Notifications
• Supervision cooperation

Key Dates

References

• [1] bakermckenzie.com
• [2] cssf.lu
• [3] cssf.lu
• [4] cssf.lu
• [5] cssf.lu
• [6] cms.law
• [7] loyensloeff.com
• [8] caceis.com