UK Financial Insights from Katten is a monthly newsletter highlighting key noteworthy developments potentially affecting financial markets and funds in the UK and Europe.
To read more issues of UK Financial Insights from Katten, please click here.
UK Regulators Publish Final Securitisation Rules
By Christopher Collins, Peter Englund, Neil Robson, Nathaniel Lalone, Ciara McBrien, Sara Portillo
On 30 April, the Financial Conduct Authority (FCA) published a policy statement (PS24/4) setting out its final firm-facing rules relating to securitisations and summarising feedback to its earlier consultation for the UK securitisation markets (CP23/17). The Prudential Regulation Authority (PRA and together with the FCA, the Regulators) also published a policy statement, in parallel with PS24/4, on its final firm-facing rules for those firms over which it has supervisory responsibility (PS7/24). This also follows the PRA's own parallel consultation (CP15/23). Read about the FCA's policy statement on securitisations.
OFSI Publishes FAQS on UK Financial Sanctions
By Christopher Collins, Neil Robson, Nathaniel Lalone, Ciara McBrien, Sara Portillo, Carolyn Jackson
On 1 May, the UK Office of Financial Sanctions Implementation (OFSI) published a new set of Frequently Asked Questions (FAQs). The FAQs provide short-form guidance and technical information on financial sanctions, including:
- the Russian oil services ban;
- the scope of General Licence INT/2024/4671884, permitting a UK law firm or UK counsel who has provided legal advice to a person designated under either the Russia or Belarus regime to receive payment from that designated person without an OFSI-specific licence, provided that the terms of the General Licence INT/2024/4671884 are met; and
- information on what constitutes "a letter of credit", "dealing with funds", "dealing with economic resources" and "making available funds or economic resources".
Read about the latest OFSI guidance.
European Parliament Adopts Corporate Sustainability Due Diligence Directive
By Neil Robson, Ciara McBrien, Sara Portillo
On April 24, the European Parliament formally adopted at first reading the final text of the Corporate Sustainability Due Diligence Directive (CSDDD). This marks the end of the key legislative process in respect of the landmark CSDDD after four years. The Parliament did not make any further changes to the text of the CSDDD, so the adopted text is the same text proposed by the Council of the European Union in March 2024, which significantly reduces the in-scope companies and extends the timeframe for compliance. Read about the CSDDD final text.
UK Regulator Updates its Approach to AI and Sets a 12-Month Plan
By Neil Robson, Sara Portillo
The UK's Financial Conduct Authority (FCA) recently published an update on its approach to artificial intelligence (AI) following the publication of the UK government's pro-innovation strategy in February 2024 (the Strategy). The Strategy identified the following five principles as 'key' to the regulation of AI in the UK: (i) safety, security, robustness; (ii) appropriate transparency and explainability; (iii) fairness; (iv) accountability and governance; and (v) contestability and redress. The update details, at a high level, how the FCA's existing approach aligns with each of the identified principles and describes itself as a 'technology-agnostic, principles-based and outcomes-focused regulator.' Read about the FCA's 12-month AI plan.
