PIMFA News Bulletin - 1 May 2020

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PIMFA NEWS BULLETIN | 1 May 2020 Welcome to your Weekly PIMFA Bulletin Grab a coffee and take 10 minutes to read this week's highlights and key issues affecting you and your firm

WE ARE IN THIS TOGETHER Dear Nigel,

We hope you and your loved ones are safe and well during this challenging time. Due to COVID-19 PIMFA continues to work remotely and operate on our members behalf and represent your interests.

We remain committed to delivering as much information as possible to our members and this Bulletin contains the latest news on the impact of the virus and other key issues

PIMFA are working on for our members. If there is anything we can be of assistance with, please contact us at enquiries@pimfa.co.uk and we will direct your query to the person best able to help you.

Best wishes The Team at PIMFA

COVID 19 & What's happening in PIMFA

Brexit: Negotiations

PIMFA Podcasts & Webinars Library

The second round of UK – EU negotiations on the future relationship

Each week we are running our members

ended last week with both sides

only Webinar Wednesday on key topics

acknowledging that “limited progress was

impacting our members due to COVID

made in bridging the gaps.” The UK and

19. This week we discussed investment

EU have not even agreed on what kind of

scams, members can watch the webinar

deal they are aiming for. While the UK is

on demand or members can watch this

looking for looser arrangements, the EU

and the past 5 webinars on the

wants a comprehensive deal covering all

government reactions and FCA updates,

areas.

or read the accompanying briefing note here.

The EU’s Chief Negotiator Michel Barnier described progress in the talks as

We are also running podcasts, webinars

“disappointing” and accused UK

and training courses, open to all, on topics

negotiators of refusing to engage on the

such as wellbeing and vulnerable clients.

most important issues for the EU. Four areas in particular are proving difficult:

Recordings of past podcasts and webinars, on topics such as Cyber

•

the level playing field

Resilience in the face of COVID,

•

fisheries

hallmarks of effective compliance,

•

governance

SM&CR etc, can all be accessed in our

•

criminal justice cooperation

learning library.

Valuable negotiating time has been lost Communicating Safely During

over the past month because of the global

COVID 19

pandemic but the UK Government continues to rule out an extension of the transition period, due to end on 31

As firms moved to remote working, video

December 2020. The next round of talks is

conferencing became essential and there

due to be held during the week beginning

was a rush to dust off existing applications

11 May. For further information, please

and download freeware from the internet.

email Maja Erceg.

This was quickly followed by waves of stories spreading panic about the risks of

PIMFA Investment Scams

virtual meetings. As a result, Mitigo has

Campaign -

produced a brief summary of the guidance

Recent Scam Examples Needed

they give clients to stay secure, which can be read here.

As part of our Financial and Mental

Further, as the National Cyber Security

Wellbeing campaign, we have launched

Centre warns businesses implementing

an initiative to keep savers safe from

remote working practices to ‘be aware of

scams, especially in light of COVID. This

email scams and encrypt/protect sensitive

initiative will provide consumers with

data’, Beyond Encryption has taken the

information on how to spot and avoid

decision to offer FREE and fully featured

scams, as well as warnings about the

user licences for a period of 2 months to

latest scams that we know about, among

enable you to safeguard the data within

a whole host of other information. If you

your emails. More information is available

are aware of any scams please let us

here.

know by contacting enquiries@pimfa.co.uk.

Commons Brexit Committee Hears Evidence from Michael Euroclear Crest Courier and

Gove

Sorting Service (CCSS) Giving evidence to the House of As you may know, Euroclear announced

Commons Brexit Committee this week,

earlier this year that the existing

Cabinet Minister Michael Gove said that

arrangements for the Crest Courier and

the coronavirus pandemic will

Sorting Service (CCSS) are under review.

“concentrate the minds” of the EU’s Brexit negotiators and “reinforce the vital

The courier company TNT have advised

importance” of bringing the negotiations to

Euroclear that they don’t wish to renew

a conclusion and secure a trade deal by

their contract for CCSS in December 2020

the end of this year. Gove refused to say

and Euroclear have started to explore the

whether the UK would walk away from the

options for replacing the current CCSS

negotiations if there is no sufficient

facility.

movement by the end of June, when the two sides are due take stock of the

One of the options under consideration is

progress made in the talks.

a digital solution which would involve firms in scanning certificates and transfers and

Gove also said that the UK is not asking

sending them electronically.

for a new or tailor made agreement but a series of 'off-the-peg' arrangements that

A number of PIMFA members have

replicate what the EU has with other

indicated that a digital solution would be

countries. As for the four areas that have

their preferred option, but there are legal

proved challenging so far, the level

issues for the company registrars, who

playing field, fisheries, governance and

currently require physical receipt of ‘wet’

criminal justice cooperation, Gove said the

signatures and original certificates before

UK will not budge on any of the issues.

they can update the share register. There

The Prime Minister’s official spokesman

is also the issue of liability – which party is

also called for “political movement on the

liable at the different stages of this

EU side” to move negotiations forward.

process in the event of a fraud or lost paperwork?

We have recently formed a working group

Share Your Stories - What is Your Firm Doing During the Crisis?

on this issue and Euroclear have kindly offered to give a fortnightly conference call

How is your firm is adapting to continue

update on their progress in identifying a

delivering your services and finding ways

solution.

to help support the national effort? Please share your stories with us by emailing us.

If you or a colleague would be interested

These examples are very helpful when it

in joining the fortnightly update calls,

comes to showcasing the profession, the

would you please email

value you add and the difference you

MichaelC@pimfa.co.uk and we will add

make.

your details to the working group database.

PIMFA Parliamentary Briefing

Furthering our commitment to COVID-19 Information Web Areas

representing our members' views to Parliament, PIMFA recently met with the

PIMFA have public and members only

new Labour Shadow Financial Services

web areas that provide the latest

Minister Pat McFadden to brief him on the

information on COVID-19. For members

sector’s key issues, the impact of COVID-

only, they can visit their web area to

19 and the importance of advice during

access webinar recordings, meeting

these difficult times.

notes, latest global response tracker, latest health statistics, updates from the CBI and much more.

Webinar: What Great Service Looks Like

Financial Adviser will be hosting a free webinar - 'What Great Service Looks Like' - on Wednesday 6 May at 3pm, discussing how service provision has changed over the past decade, what advisers expect and how great service provision leads to a better customer outcome.

Guests on the panel will be: Simon Harrington, senior policy adviser for PIMFA; Isobel Langton, chief executive of Royal London Intermediary; and Elspeth Rothwell, UK chief executive of Vested. You can register for this webinar here.

Environmental, Social and Governance (ESG) and Sustainable Finance

The European Securities and Markets Authority (ESMA) has released its consultation on regulatory technical standards (RTS) for ESG Disclosures with a response due on 1 September 2020. It is worth noting that most EU sustainable finance-related regulations are due to come into force from 2021, which is after the current date at which the UK/EU transition agreement ends (31 December 2020).

Therefore, it remains unclear how these EU regulations will apply in the UK and firms ought to prepare on the basis they will be implemented as they are, either as part of a final agreement or the UK (FCA and HM Treasury) will implement equivalent UK legislation that would not create a two tier system for financial services in the area of sustainable finance.

Further clarity around this should develop in the coming months.

In the meantime, if you have any queries or comments on the below, or wish to join PIMFA's Sustainable Finance Group where these proposals will be discussed, please contact Des FitzGerald.

Further Information •

Joint European Supervisory Authorities (ESA) consultation on ESG disclosures can be found here.

•

Joint ESA consultation on ESG disclosures - response form can be found here.

•

ESAs consultation on ESG disclosure rules can be found here.

•

ESAs consultation on ESG disclosure rules press release can be found here.

LATEST PIMFA BLOGS & PRESS RELEASES

•

PIMFA welcomes Rt. Hon. Jim Murphy to Webinar Wednesday

•

PIMFA to provide consumer advice on how to avoid scams as part of Financial and Mental Wellbeing campaign

•

Blog: Tech and the fight against Financial Crime

•

PIMFA launches first ever Virtual Festival in June

•

PIMFA welcomes FCA regulatory forbearance in wake of coronavirus outbreak

•

Blog: What does Market Abuse REALLY look like for Wealth Managers

EVENTS & LEARNING Due to the COVID-19 crisis, it is with regret that we have decided to postpone all physical events until further notice. Workshops will still be taking place online via Zoom or may be postponed. The decision has not been taken lightly; however, safeguarding the health and wellbeing of our attendees must take precedence.

Webinars and podcasts will be continuing and will be delivering content online in the coming weeks. We will be updating the website regularly and scheduling new dates. If you have any queries, please contact us at events@pimfa.co.uk.

VIRTUAL FEST We are delighted to announce the launch of Virtual Fest; a live, 2 day online learning experience covering topics such as Compliance, Cybersecurity, ESG, Operational Resilience and more.

The PIMFA Virtual Fest will take place on 3-4 June so please save the date.

Registration opens soon!

3-4 June | 2 Full Days Click here to find out more

WELLBEING & RESILIENCE WEBINAR Overnight, home working has become the norm with firms and individuals having to adapt at breakneck speed to a new way of working.

In this FREE 60-minute webinar we share practical strategies and approaches that firms are taking during the coronavirus outbreak.

7 May | 11am-Midday Book your FREE Ticket

WEBINAR WEDNESDAY VULNERABLE CLIENTS & COVID19 Our members-only Webinar Wednesday’s are a live, concise update on the latest issues effecting you and your firm during the COVID-19 pandemic. Our next episode will be discussing approach to vulnerable clients during COVID 19. In particular we will look at: •

Current FCA expectations - in light of work that has been re-prioritised and publications that have been postponed regarding their revised guidance for firms on the fair treatment of vulnerable customers

•

The impact of COVID-19 on vulnerability

•

Examples of possible issues firms may face

•

Practical steps firms can take.

Members can register for free here.

LATEST PIMFA CONSULTATION RESPONSES

PIMFA’s latest consultation response is to the Charity Commission regarding how charities approach investing in line with their purpose and values.

Read this and all of our other PIMFA consultation papers here.

WHAT'S HAPPENING IN OUR INDUSTRY

Validity of Electronic Signatures

In the current Covid 19 crisis, which has led to enforced social distancing, issues have arisen in relation to the signing and witnessing of documents. In a recent statement on the use of electronic signatures, the FCA made the following points: •

The validity of electronic signatures is a matter of law

•

FCA rules do not prevent firms from using electronic signatures in agreements

•

Firms may use electronic signatures for all interactions with the FCA

A Law Commission report, published at the end of last year, stated that ‘in most cases’ electronic signatures can be used as viable alternatives to handwritten ones. The report indicated that an electronic signature is capable in law of executing a document (including a deed) provided that the person signing intends to do so and that any further required formalities, such as a witness, are satisfied.

Regarding witnesses, where they are required, the current rule is that they need to be physically present, with the witness watching the signatory apply their signature whether on paper or electronically. However given the circumstances of the lockdown and social distancing rules, there is lack of clarity on how this is to be achieved in practice and on the proper interpretation of the rule in the current circumstances. In light of this, we recommend that firms take legal advice.

You can read: •

the FCA’s web-page here

•

the Law Commission’s report here

FCA: UK extends payment security deadline due to coronavirus

In the exceptional circumstances of the Covid crisis, FCA are giving the industry an additional 6 months to implement strong customer authentication (SCA) for e-commerce.

This will minimise potential disruption to consumers and merchants. The new timeline of 14 September 2021 replaces the 14 March 2021 date.

Firms are required to take all necessary steps to comply with the revised detailed phased implementation plan and critical path to avoid the risk of enforcement action. FCA expects UK Finance to discuss the plan and critical path with all stakeholders and agree it with the FCA as soon as possible. In the meantime, firms should continue with the necessary preparatory activities such as robust end-to-end testing.

After 14 September 2021, any firm that fails to comply with the requirements for SCA will be subject to full FCA supervisory and enforcement action. Further information is available here.

International Tax Enforcement (Disclosable Arrangements) Regulations

Her Majesty's Revenue & Customs (HMRC) have recently shared draft guidance on the International Tax Enforcement (Disposable Arrangements) Regulations (DAC6) – you firm may have received a copy already – if not, please email kevins@pimfa.co.uk.

In their covering email, HMRC stated:“We will be continuing to update this guidance to provide further clarity and additional examples before the regulations come into force. In particular, we will be including guidance on penalties prior to the guidance being published in HMRC’s International Exchange of Information manual.

If you would like to make comments on this guidance, please send them to mandatorydisclosure.rules@hmrc.gov.uk, ideally by 15 May 2020.

A number of people have been in touch to ask whether the implementation of these rules will be delayed in light of the circumstances around Covid-19. We are carefully considering the representations we have received. We understand the concerns that have been raised and will let you know as soon as possible of any developments.”

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