Welcome to this edition of ‘Being better informed’, our monthly FS regulatory, accounting and audit bulletin, which aims to keep you up to speed with significant developments and their implications across all the financial services sectors.
We now know the make-up of the EP for the next four years after Europeans cast their votes in May. Whilst the shift to right-wing candidates caused shockwaves, particularly in France and the UK, much is likely to continue as before. More consensus will be needed between the centre right and left parties (the European People’s Party (EPP) and the Socials and Democrats (S&D) respectively) to move the EU legislative agenda forward. The Alliance of Liberals and Democrats for Europe (ALDE) will no longer play quite the same role as in the previous EP as its numbers have dropped near the levels of both the European Conservatives and Reformists (ECR) and the Greens/European Free Alliance. So the dynamic between these five groups will change.
MiFID II finally entered the Official Journal on 12 June, creating 2 January 2017 as the deadline for firms to comply with the new rules. ESMA published a MiFID II discussion paper and consultation paper on Level 2 measures to help shape these rules. At a combined 840 pages long, and with 860 questions posed, the papers will take some digesting. They close to comments at the beginning of August, so time is short. This month’s feature focuses on a specific area of the MiFID II debate – high frequency trading. We’ll be covering the discussion and consultation papers in more detail next month.
Insurance firms continue to attract the regulators’ attention, both in the UK and across the EU. The Solvency II implementation date has been confirmed now with Omnibus II published in the Official Journal. This development has led to a number of updates from EIOPA and the PRA – new consultations, new proposed guidelines and supervisory statements. The countdown to 1 January 2016 is well underway, and firms have a busy 18 months ahead to make sure they’re ready. Finally, we expect also expect the coming months to be busy on the regulatory front. Regulators will be keen to meet their previous commitments to publish consultations and rules before the second half of 2014, just in time for the summer holiday reading.