Financial Services SpeedRead: 20 June 2025 edition

Welcome to the latest edition of the Financial Services SpeedRead, a collection of bite-sized updates designed to help you keep on top of key regulatory developments in financial services over the preceding fortnight. Please get in touch if you want to explore any of the topics covered in this fortnight's edition of Financial Services SpeedRead in more detail.

Financial Markets

1. EU Commission adopts RTS to enable creation of consolidated tape under MiFIR

On 12 June 2025, the EU Commission adopted four Delegated Regulations containing regulatory technical standards (RTS) which enable the creation of the consolidated tape under the Markets in Financial Instruments Regulation (MiFIR). The RTS are contained in the following: C(2025) 3100, C(2025) 301, C(2025) 3102, and C(2025) 3103.

The RTS seek to ensure that the consolidated tapes receive high quality data in a timely manner, specify the criteria for authorising consolidated tape providers and define the methodology for the equity tape provider to share the revenue earned from selling consolidated data with the trading venues that supplied it. Finally, they specify the conditions for making market data available to the public in an accessible, fair and non-discriminatory manner, while ensuring fair and reasonable fees.

The introduction of a consolidated tape is expected to benefit both professional and retail investors by providing a comprehensive, real-time view of market activity, thereby improving overall price transparency across the EU.

The Delegated Regulations will now be submitted to the European Parliament and Council. If neither objects, they will enter into force 20 days after their publication in the Official Journal of the EU.

2. ESMA publishes advice and recommendations on the Prospectus Regulation and civil prospectus liability

On 12 June 2025, ESMA published two final reports containing technical advice on the Prospectus Regulation (EU) 2017/1129 and on civil prospectus liability (see here and here, respectively), offering recommendations aimed at easing regulatory burden and supporting capital market activity.

The first report provides advice on drafting prospectuses in accordance with the Prospectus Regulation, including guidance on content, format, information scrutiny, and approval procedures. It also proposes new disclosure requirements for non-equity securities with ESG features, and updates data reporting obligations to reflect changes from the Listing Act and the introduction of the European Single Access Point.

The second report (on civil prospectus liability) notes that most stakeholders view the current regime as balanced and consider there is no need for immediate reform. ESMA’s advice is accompanied by an update to relevant sections of its 2013 report (ESMA/2013/619) on prospectus liability.

Both reports have been submitted to the European Commission. The Commission will decide within three months whether to adopt the proposed updates to data reporting requirements, mentioned above. Regarding civil prospectus liability, the Commission will present a report to the European Parliament and Council by 31 December 2025, assessing whether further harmonisation of prospectus liability across the EU is necessary.

3. FCA publishes policy statement on PISCES rules

On 10 June 2025, the FCA published a policy statement containing its final rules on the Private Intermittent Securities and Capital Exchange System (PISCES) sandbox, setting out the regulatory framework for platform operators.

PISCES is a new type of private share trading platform, which will allow the intermittent trading of private company shares. For further details on PISCES and the related regulations, please see our previous Financial Services SpeedRead here and here). The FCA’s rules, together with the PISCES Sandbox Regulations published in May 2025, establish the requirements for participation in the temporary sandbox, which is scheduled to run until 2030.

The key requirements applicable to PISCES companies include, but are not limited to:

• Disclosure arrangements: core information disclosure requirements (including detail of the business and its management, key financial information, details of share capital, and information on employee share schemes);
• Trading events and price parameters: PISCES companies may set floor and/or ceiling prices for their shares, and agree price parameters or valuations with key investors. Where applicable, such arrangements must be disclosed, including the identity of any other party involved. Companies may also impose restrictions on who can participate in trading events, subject to oversight from the FCA on restricting investor access; and
• Market conduct: Notably, PISCES will not be subject to the UK’s civil or criminal insider dealing regime, and UK MAR will not apply to shares traded on PISCES platforms. Instead, PISCES operators are responsible for implementing measures to mitigate the risk of manipulative trading practices, including those that could give false or misleading impressions of the market or share value.

The PISCES sandbox is now open for applications. Trading events on PISCES platforms are expected to commence later in 2025. For a more detailed overview of the rules' key focus areas, see our briefing here.

Banking and Prudential

4. EU Commission adopts Delegated Regulation postponing date of application of the Fundamental Review of the Trading Book to January 2027

On 12 June 2025, the EU Commission published a Commission Delegated Regulation amending Regulation (EU) No 575/2013 with regard to the date of application of the fundamental review of the trading book (FRTB) under Article 46A of the Capital Requirements Regulation (CRR).

The EU Commission proposed the delay in March 2025, and FRTB implementation will now occur on 1 January 2027.

The Commission Delegated Regulation is now set to be scrutinised by the European Parliament and Council for the next three months. If no objections are raised, it will enter into force on the day after its publication in the Official Journal of the European Union and apply from 1 January 2026.

5. Council of the EU approves decision to maintain certain bank liquidity rules

On 12 June 2025, the Council of the EU published a press release confirming its adoption of specific modifications to the EU’s liquidity regulations for the banking sector, through amendment of the CRR.

Under the CRR, some short-term securities financing transactions (SFTs) benefit from lower liquidity requirements than those set out in the Basel III standards. The transitional treatment is set to expire on 28 June 2025, after which the ratios would have automatically increased in line with the Basel standards.

The Council of the EU's decision makes permanent the transitional required stable funding (RSF) ratio levels for certain SFTs held by banks, which are used to help calculate the net stable funding ratio (NSFR).

The adoption process is now finalised, and the amendments to the Capital Requirements Regulation will accordingly be published in the EU’s Official Journal, effective from 29 June 2025. The EBA will review and report on the impact of these changes every five years, under the new rules.

Fund Management

No new entries.

Senior Managers and Governance

No new entries.

Financial Crime

No new entries.

Retail Services

6. FCA launches Investment Advice Assessment Tool

On 11 June 2025, the FCA published the Investment Advice Assessment Tool (IAAT) (and associated webpage, see here), developed to help personal investment firms understand how the FCA assesses the suitability of firms' investment advice and disclosures (excluding advice in relation to retirement income or defined benefit transfers). The FCA has also published an instruction guide on use of the IAAT, and how to interpret its output.

Firms wishing to use the IAAT must complete a template detailing the nature of the advice and information about the client. The aim is to enable the FCA, using that information, to consider firms' compliance with key requirements including (but not limited to) disclosure requirements, suitability, and the requirement to act in the client's best interest.

Firms do not require any specific qualifications or permissions to access the tool, and can utilise the IAAT to assess the suitability of advice provided after 3 January 2018.

7. Supreme Court overturns Court of Appeal Judgment in undue influence mortgage case (Waller-Edwards v One Savings Bank Plc)

On 4 June 2025, the Supreme Court unanimously overturned a Court of Appeal judgement in a case concerning the application of the surety transaction test and the responsibilities of lenders. The case involved Waller Edwards, who in 2011 transferred her home and savings to a property being developed by her partner, Mr Bishop. In 2013, Mr Bishop obtained a remortgage of £384,000 from the Bank, representing the purpose as a buy-to-let investment and debt repayment. The Bank approved the loan on this basis, but the funds were in fact used to pay Mr Bishop’s divorce settlement and to clear an existing charge on the property.

Ms Edwards alleged that she had acted under the undue influence of her partner. The Supreme Court held that where more than a de minimis (i.e. trivial) element of borrowing is used to discharge the debts of one borrower, and therefore this may not be to the financial advantage of the other, the transaction should be treated as a surety transaction. In such cases, the lender must follow the Etridge protocol which means the Bank is put on inquiry and must follow a certain steps to ensure that any potentially vulnerable party is fully aware of the risks and liabilities involved.

The Supreme Court rejected the Court of Appeal’s application of the fact and degree test, which had assessed the transaction as a whole to determine whether it was a joint borrowing. Instead, the Supreme Court confirmed that, in these circumstances, the transaction must be viewed from the lender’s perspective and the surety test applied where appropriate. If the lender does not follow the Etridge protocol when required, the vulnerable party may be entitled to set aside the transaction.

8. FCA publishes considerations in relation to possible motor finance consumer redress scheme

On 5 June 2025, the FCA published a summary of its considerations in relation to the introduction of a motor finance consumer redress scheme. This follows the Court of Appeal's decision on 25 October 2024 in the Johnson case, which is being appealed to the Supreme Court.

In March 2025, the FCA said that if, following the Supreme Court judgment, it was to conclude that motor finance consumers have lost out, it would likely consult on an industry-wide consumer redress scheme.

In designing a redress scheme, the FCA would be guided by specific principles, namely: comprehensiveness, fairness, certainty, simplicity and cost effectiveness, timeliness, transparency and market integrity. The regulator welcomes recommendations on how to strike a good balance between these principles, acknowledging, for example, that when seeking to make a redress scheme as comprehensive and wide-ranging as possible, consumers may need to wait longer for redress because of a larger amount of claims to process.

One of the features that the FCA would need to consider when designing a redress scheme is whether an opt-in or an opt-out approach would apply. It expects an opt-out approach to be simpler for consumers, but also more expensive and more time-consuming to implement for firms.

The FCA does not confirm any redress rates, but acknowledges that it has seen a range of suggestions, including "some highly speculative figures by some [claims management companies] and law firms".

The FCA will consult on how any redress scheme works in practice, and expects the final rules to be in place during 2026.

9. FCA publishes press release regarding global crackdown on unlawful financial promotions by finfluencers

On 2 June 2025, the FCA published a press release announcing it has led an international campaign to address illegal financial promotions by unauthorised social media influencers, commonly referred to as "finfluencers." The other participating regulators were from Australia, Canada, Hong Kong, Italy, and the United Arab Emirates.

During the week of action, the FCA undertook several enforcement measures in the UK:

• Three individuals were arrested with the assistance of the City of London Police;
• Criminal proceedings were authorised against those three individuals;
• Four finfluencers were invited for interview;
• Seven cease and desist letters were issued; and
• 50 warning alerts were published These warning alerts are expected to result in over 650 requests for the removal of content from social media platforms and the closure of more than 50 websites operated by unauthorised finfluencers.

Digital Finance and Fintech

10. European Commission adopts three regulatory technical standards supplementing MiCA

On 10 June 2025, the European Commission published the following three Delegated Regulations supplementing the Markets in Crypto-Assets Regulation (MiCA):

• Commission Delegated Regulation (EU) 2025/1141: supplementing MiCA by setting out regulatory technical standards (RTS) which specify the requirements for policies and procedures to address conflicts of interest for issuers of asset-referenced tokens;
• Commission Delegated Regulation (EU) 2025/1140: supplementing MiCA by setting out RTS which set out record-keeping obligations for all crypto-asset services, activities, orders, and transactions carried out; and
• Commission Delegated Regulation (EU) 2025/1142: supplementing MiCA by setting out RTS which set out the requirements for policies and procedures to manage conflicts of interest for crypto-asset service providers, as well as the details and methodology for disclosures relating to conflicts of interest.

These Delegated Regulations come into force on 30 June 2025.

11. European Commission publishes regulatory technical standards for authorisation applications by issuers of asset-referenced tokens

On 5 June 2025, the European Commission published a Delegated Regulation setting out RTS for authorisation applications by issuers of asset-referenced tokens (ARTs) under MiCA. These RTS specify the detailed information required in applications to offer ARTs to the public or seek their admission to trading. The RTS covers the following information to be included in an application:

• identification details of the applicant issuer;
• the applicant's programme of operations – this involves a three-year business plan, including the business model, strategy, risk assessment (covering money laundering and terrorist financing risks), and financial forecasts;
• the applicant's internal governance arrangements and structural organisation – this involves details on governance structures, internal controls, ICT risk management, business continuity, and third-party service providers;
• liquidity management, reserve of assets and redemptions rights – this involves a description of the stabilisation mechanism for the relevant ART; and
• details on members of the management body, shareholders or members with direct or indirect qualifying holdings.

The Delegated Regulation will enter into force 20 days after publication in the Official Journal.

Payments

12. HM Treasury publishes The Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025

On 12 June 2025, HM Treasury published the Payment Services and Payment Accounts (Contract Termination) (Amendment) Regulations 2025, along with an explanatory memorandum. These Regulations amend regulation 51 of the Payment Services Regulations 2017 (PSRs) to enhance customer protections when payment service providers (PSPs) terminate contracts with payment service users.

The key changes are as follows:

• extended notice period: PSPs must now give at least 90 days’ notice before terminating a contract, subject to certain exceptions;
• clear termination reasons: PSPs are required to supply sufficient detail so customers can understand why their contract is being terminated; and
• complaint rights notification: PSPs must inform customers of their right to complain to the Financial Ombudsman Service.

Similar changes will also apply to accounts with basic features covered by the Payment Accounts Regulations 2015, to align with the new requirements under the PSRs.

The Regulations will come into force on 28 April 2026 and will apply to framework contracts for payment services entered into, on or after this date, where the agreement is for an indefinite period

ESG

13. ECB adds indicator of nature loss in climate-related financial disclosures

On 12 June 2025, the European Central Bank (ECB) published its third set climate-related financial disclosures, providing an overview of the carbon footprint and climate risk exposures of the Eurosystem's monetary policy portfolios, the ECB's foreign reserves, and the ECB's non-monetary policy portfolios. featuring a new indicator for portfolio exposure to sectors dependent on or impacting nature.

According to the ECB, 30% of the Eurosystem’s corporate bond holdings are concentrated in the most exposed sectors—utilities, food, and real estate—while up to 40% of equity ETFs in the ECB’s own funds portfolio are similarly exposed. Portfolio emissions continue to decline, aided by a tilting strategy that favours issuers with better climate performance, accounting for a quarter of emission reductions since 2021. The ECB set a 7% annual emission intensity reduction target for its corporate bond holdings and increased green bond investments to 28%, aiming for 32% in 2025.

The ECB highlight persistent challenges including limited data coverage, inconsistent emissions reporting, and the need for harmonised standards to support effective risk management and informed investment decisions.

Other

14. FCA publishes Quarterly Consultation Paper No. 48

On 6 June 2025, the FCA published its Quarterly Consultation Paper No. 48 (CP 25/16). The consultation paper proposes various amendments to the FCA Handbook, including the following:

• amending SUP 6.4 guidance to reflect legislative changes introduced by section 415AA of  FSMA 2000;
• removing reporting requirements, notifications and nil return requirements for REP008, and amendments to the frequency of reporting for REP009;
• lifting the ban on the retail sale, marketing and distribution of cryptoasset exchange traded notes admitted to a UK recognised investment exchange and categorisation of these traded notes as 'Restricted Mass Market Investments';
• amending SUP 16 and DISP with the aim of moving the scheduling of existing consumer credit data return CCR007 to calendar year reporting periods; and
• reducing the assessment of value reporting for authorised fund managers.

The FCA will be accepting responses to the proposed amendments until: (i) 30 June 2025 for chapters 3 and 5; (ii) 7 July 2025 for chapter 4; and (iii) 14 July 2025 for chapters 2, 6 and 7.

15. FCA chief data, information and intelligence officer delivers speech in relation to the FCA's efforts to accelerate AI innovation

On 10 June 2025, the FCA published a speech given by Jessica Rusu, FCA chief data, information and intelligence officer, at the London Tech Week 2025 on the FCA's collaboration with NVIDIA to accelerate AI innovation.

Ms Rusu started with a general discussion of the FCA's AI Lab, which launched in January 2025 and features four zones: AI Sprint, the AI Input Zone, the AI Spotlight and the Supercharged Sandbox. For example, Ms Rusu mentioned that feedback received via the AI Input Zone shows strong support for an outcome and principles-based approach to AI, and that introducing an AI-specific framework would not currently be helpful. Instead, the FCA will continue to rely on existing frameworks, such as the Consumer Duty and Senior Managers Regime, to avoid introducing additional regulations for AI.

Ms Rusu also announced the following new initiatives:

• AI Spotlight digital repository: as part of the FCA's AI Lab, this is an interactive platform for firms to explore real-world AI solutions in financial services; and
• Collaboration with NVIDIA: the FCA is collaborating with NVIDIA to "supercharge" the FCA's Digital Sandbox, which is a service designed to simplify the development and launch of innovative solutions within the financial services industry. Please refer to the entry below for further details.

16. FCA launches Supercharged Sandbox to help firms experiment safely with AI

On 9 June 2025, the FCA launched a Supercharged Sandbox which gives firms the opportunity to experiment with AI using NVIDIA computing and AI software. The Supercharged Sandbox will provide participating firms with access to better data and resources, including dedicated GPU capabilities and the NVIDIA AI Enterprise Software Suite, and access to technical expertise and regulatory support.

This will enable rapid testing, validation, and refinement of AI models to be used by financial services firms. The platform will be complemented by the FCA's AI Live Testing service, which helps firms transition from sandbox experimentation to live market deployment.

The Supercharged Sandbox will run as a three-month, cohort-based initiative from 30 September 2025 to 9 January 2026. It begins with a virtual kick-off and bootcamp, followed by testing within the secure, cloud-based Supercharged Sandbox platform, and concludes with an in-person Demo Day in January 2026. The application window opened on 9 June 2025 via the Digital Sandbox portal, and will close on 11 August 2025, with results communicated by 16 September 2025 via the Digital Sandbox portal.

17. FCA publishes revised Enforcement Guide

On 3 June 2025, the FCA published a policy statement (PS25/5) setting out its revised Enforcement Guide (ENFG) and amendments to its publicity policy so as to ensure greater transparency around enforcement investigations.

The regulator's updated ENFG is intended to be a more user-friendly document for firms and advisers.

Chapter 4 of the revised Enforcement Guide deals with the amended investigation publicity policy. One of the key decisions noted in the ENFG is that the FCA will not be proceeding with its previous proposal to introduce a public interest framework, and will instead be retaining the 'exceptional circumstances' test for announcing investigations into regulated firms. The policy statement sets out three new exceptions to this test, meaning the FCA can announce investigations in the following scenarios:

• where there has been suspected unauthorised activity or criminal offences related to unregulated activity;
• on an anonymised basis (i.e. without naming the subject of the investigation); and
• where it is confirming that it is investigating a subject if the investigation has already been made public (e.g. by the firm or another regulatory body).

The FCA's revised policy will apply to all investigations initiated on or after 3 June 2025 by way of statutory appointment of investigators. For further details, please see our Ashurst briefing here.

Authors: Penny Chamberlain, Associate; Tiegan Cormie, Associate; Roni Fass, Associate; Anjali Naik, Legal Apprentice