Regulatory initiatives grid launched ahead of time to help firms impacted by coronavirus

The ‘Regulatory Initiatives Grid’ was originally announced in March, when HM Treasury said it would be published twice a year. The grid lays out the planned timetable for major initiatives, such as the transition from LIBOR and the introduction of financial services legislation to prepare for the end of the EU withdrawal transition period.

The grid (20-page / 511KB PDF) lays out upcoming regulatory initiatives, focusing on three discrete periods: the near-term, through to summer 2020; the medium-term, from the summer to March 2021; and the longer term, from April 2021 onwards.

The forum, which is comprised of the Bank of England, Prudential Regulation Authority, Financial Conduct Authority, Payment Systems Regulator, Competition and Markets Authority, and HM Treasury as an observer member, said responding to the impact of Covid-19 and mitigating its negative effects as far as possible was a “universal near-term priority”.

As a result, some initiatives have been extended into the medium-term period, which also covers the end of the Brexit transition period, and timings are unconfirmed for a number of initiatives. The forum said it would continue to review the planning of policy finalisation and implementation dates to manage demand on the industry.

Financial services regulation expert Elizabeth Budd of Pinsent Masons, the law firm behind Out-Law, said the accelerated publication of the grid was “incredibly helpful” for regulated financial services firms.

“It enables them to see at a glance an overview of the regulatory developments that are coming up and makes it easier for them to check the effect of Covid-19 on the timing of these initiatives,” Budd said.

“As the grid is organised by sector it helpfully groups in one place the pipelines of the various regulators that will be of interest to firms in those areas of business,” Budd said.

Budd said a chapter focusing on cross-sectoral developments was particularly helpful.

“These are the more pervasive issues impacting on wider tranches of the industry as a whole. This chapter indicates regulatory focus on climate change, technological innovation and operational resilience, as well as work in preparation for the end of the Brexit transition period, are just a number of the regulators’ work streams that remain relevant across much of the sector,” Budd said.

The document notes that the majority of regulatory initiatives have been impacted or delayed by Covid-19, with the timing amended for planned consultations and reviews across all sectors. In addition to the ‘multi-sector’ chapters, the grid covers sectors including payment services and market infrastructure, investment funds, banking, pensions and insurance.

Among the initiatives which have not been impacted by Covid-19 are the introduction of new equivalence regimes for retail investment funds and money market funds. The grid reminds firms of the closure of the consultation on this new overseas funds regime on 11 May and notes that it will be included in the upcoming Financial Services Bill.

The introduction of the Investment Firms Prudential Regime will also be included in the upcoming Financial Services Bill. A tentative date of July to September 2020 is noted for this, with implementation then not due until after March 2021. The new regime will see investment funds split out from the current prudential regime, which sees them regulated under the same umbrella as banks and building societies.

Other regulatory proposals covered in the grid include the implementation of platform transfer rules, which has been impacted by Covid-19 and is now set to happen on 1 February 2021.