EBA publishes a no-action letter on the boundary between the banking book and the trading book provisions 

The European Banking Authority (EBA) has published a no-action letter stating that competent authorities should not prioritise any supervisory or enforcement action in relation to the new banking book – trading book boundary provisions. 

The amendments to the Capital Requirements Regulation (CRR2) introduced elements of the Basel standards on the trading book/ non-trading book boundary framework, which will be applied as of 28 June 2023. 

UK economic crime levy update 

The UK’s HMRC has published new guidance on the forthcoming economic crime levy, an annual charge that will affect entities who are supervised under the Money Laundering Regulations (MLR) and whose UK revenue exceeds £10.2 million per year.  The payment must be made by 30th September each year and will be collected by one of three bodies: 

1. the Financial Conduct Authority (FCA) 
2. the Gambling Commission (GC) 
3. HMRC.

UK regulatory initiatives published 

UK regulators have published the latest edition of the Regulatory Initiatives Grid which outlines forthcoming regulatory change. The grid is compiled by the Bank of England (BoE), Competition and Markets Authority (CMA), Financial Conduct Authority (FCA), Financial Reporting Council (FRC), His Majesty’s Treasury (HMT), Information Commissioner’s Office (ICO), Prudential Regulation Authority (PRA), Payments Services Regulator (PSR) and the Pensions Regulator (TPR). The latest matrix focuses on:  

• Multi-sector issues 
• Banking, credit and lending 
• Payments and cryptoassets
• Insurance and reinsurance 
• Investment management 
• Pensions and retirement income 
• Retail investments; and  
• Wholesale financial markets. 

And covers topics such as ESG, cross-cutting/omnibus, financial resilience, operational resilience, conduct and competition, innovation and other miscellaneous. 

HK SFC releases crypto consultation 

The Hong Kong Securities and Futures Commission has released its Consultation Paper on the Proposed Regulatory Requirements for Virtual Asset Trading Platform Operators Licensed by the Securities and Futures Commission. The consultation is designed to review “the proposed regulatory requirements for licensed [virtual asset] trading platforms. As the existing regime under the Securities and Futures Ordinance (Cap. 571) (SFO) for VA trading platforms which offer at least one security token has been in place for a number of years and the virtual asset landscape has changed significantly during this period, the SFC has taken the opportunity to review these requirements and examine whether modifications should be made to strike a better balance between investor protection and market development.” 

The consultation ends on 31^st March 2023.