Regulatory notice

On 1st of August 2022, FCA published a consultation paper on broadening retail access to the long-term asset fund (LTAF).

The proposals out for consideration would provide access to non-traditional investments, which consumers might use to FCA clamps down on marketing of high-risk investments to consumers diversify their portfolio and for potentially higher returns, while still offering strong consumer protection.

On August 2022, the FCA publishes its final rules last week on the final rules concerning financial promotion rules for high-risk investments and firms approving financial promotions following a consultation (CP 22/2) launched the beginning of the year.

The tightening of the rules is part of the new consumer duty and also by the need to protect investors from investing in riskier financial products, notably by the rising of inflation.

Based on the answers received, the FCA reviewed its initial proposals as follows:

The FinDatEx PRIIPs technical working group has updated the European PRIIPs Template (EPT V2.1) making the necessary changes to deal with the new UK PRIIPs regime amended by FCA on March 2022.

At the end of July, the FCA published its Policy Statement 22/9 on a New Consumer Duty together with the Final non-Handbook Guidance FG 22/5 for firms on this topic.

This Policy Statement and related Guidance follow a consultation launches in May last year in the context of the Consumer Strategy.

The Consumer Duty aims to reinforce the protection of the retail investors applies across all of a firm’s activities, from high-level strategic planning to individual customer interactions.

The Official Journal of the French Republic publishes the Decree of 27 June 2022 approving amendments to the General Regulation of the of the « Autorité des Marchés Financiers” as regards to the application of the amended PRIIPs regulation.

The European Securities and Markets Authority recently updated its SFDR implementation timeline.

On 28 July 2022, the official gazette of the Grand Duchy of Luxembourg (Memorial A) published the amendments to the CSSF Regulation 2010-4 of 20 December 2010.

The changes were made necessary by the implementation of the provisions of the Delegated Directive (EU) 2021/1270 as regards the sustainability risks and sustainability factors to be taken into account for UCITS. It is worth noting that the provisions do not diverge from the Directive and are well known since its publication.

The Joint Committee of the ESAs published yesterday a report on the on the extent of voluntary disclosure of principal adverse impact under the SFDR.

The Article 18 SFDR provides that ‘By 10 September 2022, and every year thereafter, the ESAs shall submit a report to the Commission on best practices and make recommendations towards voluntary reporting standards’. Based on this article, the JC of ESAs made its assessment with the help of the National Competent Authorities and delivered this report focusing on application of Article 4 (1a) and also 4 (1b) even not requested, i.e. financial market participants (FMPs) taking into account the negative impacts of investment decisions on sustainability factors and those who do not.

As regards to pre-contractual disclosures for Art. 8 and 9 products, the CSSF expects receiving updated documents (precontractual and periodic disclosure information in the format of templates set out in the annexes of the SFDR RTS) by 31 October 2022 to guarantee the delivery of the Visa before 31 December 2022.