Financial Services SpeedRead 22 December Edition 2022

1. HM Treasury: Policy Statement: Building a Smarter Financial Services Framework for the UK

On 9 December 2022, HM Treasury published a Policy Statement which explained the UK government's approach to repealing and replacing retained EU Law (REUL) on financial services.

The Financial Services and Markets (FSM) Bill, which is currently under review by Parliament, will repeal financial services REUL in order to establish a comprehensive FSMA model of regulation. The FSM Bill introduces a range of new tools to enable the transition to the comprehensive FSMA model. This includes a new Designated Activities Regime (DAR) which will be a new part of FSMA designed to provide a framework for regulating activities related to financial markets in a proportionate way that reflects the degree of risk these activities pose.

The government has also published illustrative statutory instruments (SIs) alongside the policy statement in order to give stakeholders a more detailed understanding of the approach the government is taking. These SIs are in regards to:

•  the admissions to trading and public offer regime;
•  the prospectus regulation;
•  the securitisation regulation;
• wider rulemaking powers, granted to the FCA in relation to payments regulation; and
•  services and e-money regulations.

2. UK Government: The Edinburgh Reforms

On 9 December 2022, Chancellor of the Exchequer, Jeremy Hunt, outlined a series of measures designed to drive growth and competitiveness in the UK financial services sector (the Edinburgh Reforms). The reforms are divided into four categories: a competitive marketplace promoting effective use of capital; sustainable finance; technology and innovation; and consumers and business.

Smarter regulatory framework

• The Future Regulatory Framework (FRF) Review was set up to determine how the financial services regulatory framework should adapt to the UK’s new position outside of the EU. The outcomes of the FRF Review are now being delivered through the Financial Services and Markets Bill 2022-23. The Bill also repeals retained EU law, enabling the Government to replace it with legislation designed specifically for UK markets law order and to establish a comprehensive FSMA model of regulation. The Chancellor's speech and the Government's Policy Statement on building a smarter financial services framework set out further details in this regard.

Ring-fencing regime for banks

• The Government published its response to the March 2022 final report of the independent review of ring-fencing and proprietary trading and has confirmed its intention to consult in mid-2023 on a series of near-term reforms (with a view to bringing forward secondary legislation later that year). The Government has also announced plans for a public call for evidence, in the first quarter of 2023, to review the practicalities of aligning the ring-fencing and resolution regimes.

Wholesale Markets Review MIFID

• The Government has published the Markets in Financial Instruments (Investor Reporting) (Amendment) Regulations 2022 (SI 2022/1297), which make certain amendments to reporting requirements for firms. The Government has also confirmed plans in relation to the commodities regime: consolidated tape; and investment research.

Call for Evidence on Short Selling Regulation

• The Government intends to repeal the Short Selling Regulation and the call for evidence is the first step towards replacing retained EU law with a regulatory framework specifically tailored to the UK. The Government will consider which aspects of the regime that should remain in legislation, and which should be delegated to the FCA to set in its rules.

Consultation on PRIIPs

• The Government is consulting on the repeal of PRIIPs Regulation and is seeking views on a proposed alternative framework for retail disclosure as part of the implementation of the Future Regulatory Framework Review. The closing date for comments is 3 March 2023.

Consultation on information requirements in the Payment Account Regulations

• The Government is looking into whether to remove certain customer information requirements related to bank accounts under the Payment Accounts Regulations. Responses must be submitted by February 17 2023.

SMCR

• The Chancellor confirms that the Government and regulators will separately commence a review of the Senior Managers & Certification Regime in Q1 2023. The Government will launch a call for evidence to look at the legislative framework of the regime, and that the FCA and PRA will review the regulatory framework.

Technology and innovation

• Reforms in this area build on the UK’s desire to harness the benefits of emerging technologies and notable measures outlined in this area include: a taskforce on accelerated settlement; a consultation on a UK retail central bank digital currency alongside the Bank of England in the near future; a Financial Market Infrastructure Sandbox in 2023; and trialling a new class of wholesale market venue which would operate on an intermittent trading basis.

Delivering for consumers and businesses

• The Government has published a consultation on reforming the Consumer Credit Act 1974. The deadline for responses is 17 March 2023. The Government confirms that it will work with the FCA to look into the boundary between regulated financial advice and financial guidance.

3. HM Treasury: Response to review on ring-fencing and proprietary trading

On 9 December 2022, the government published its response to recommendations from the Independent Panel on Ring-fencing and Proprietary Trading. The response indicates that it plans to consult in mid-2023 on reforms relating to the ring-fencing regime, to be implemented through secondary legislation. The intention is to gather evidence from the public in early 2023 on how feasible it would be to align the ring-fencing and resolution regimes.

4. HM Treasury: Call for evidence in reviewing Short Selling Regulation

On 9 December 2022, the government published a call for evidence to gather responses on how it should amend current regulation on short selling. EU regulation on short selling was onshored upon the UK's exit from the EU. The eventual goal of the consultation process is to repeal and replace the Short Selling Regulation, with the aim of tailoring the future regime to UK markets and increasing the competitiveness of UK markets. Responses can be submitted until 4 March 2023.

5. HM Treasury: Future Regulatory Framework Review

On 9 December 2022, the Treasury concluded its Future Regulatory Framework Review (the FRF Review), which aims to ensure that the UK regulatory framework for financial services continues to be coherent, agile and internationally respected post-Brexit.

The objectives of the FRF Review are to:

• add to existing objectives and regulatory principles;
• build on existing accountability arrangements, enhance scrutiny of the Treasury's activities, and strengthen stakeholder engagement; and
• give powers to the Treasury and the financial services regulators.

The outcomes set out in the FRF Review are to be implemented in the Financial Services and Markets Bill. Once passed, the Treasury will repeal firm-facing provisions in retained EU law and replace it with an appropriate UK framework which, once repealed and replaced, will be incorporated into the rulebooks of the Treasury and financial services regulators.

6. Statutory Instruments: The Markets in Financial Instruments (Investor Reporting) (Amendment) Regulations 2022 (SI 2022/1297)

On 9 December 2022, the government published regulations which amend Commission Delegated Regulation (EU) 2017/565 regarding operating conditions and organisational requirements for investment firms. This follows from the Wholesale Markets Review consultation and aims to action the changes that arose as a result. The overarching goal of the Review relates to ensuring the delivery of an outcomes-based, fair rulebook which supports competitiveness. The amendments remove the need for reporting requirements for retail clients, thereby relieving investment firms of regulatory burdens whilst ensuring that the UK retains robust standards of regulation.

7. HM Treasury: Consultation: Information requirements in the Payment Account Regulations

On 9 December 2022, HM Treasury published its consultation on payment accounts. It is consulting on a number of issues, for instance the use of Fee Information Documents (FIDs) and Statements of Fees (SoFs). It is also interested in views on the presentational requirements under the Payment Accounts Regulations and the FCA's requirement to maintain a linked services list and payment service providers' requirement to provide customers with a glossary of related definitions, amongst other things. The consultation will close on 17 February 2023.

8. European Commission: Legislative proposals to amend EU clearing regime

On 7 December 2022, the European Commission published the following legislative proposals amending the EU clearing regime:

• a draft Regulation amending EMIR, CRR and the MMF Regulation as regards measures to mitigate excessive exposures to third-country central counterparties; and
• a draft Directive amending the Capital Requirements Directive, the Investment Firms Directive and UCITS Directive as regards the treatment of concentration risk towards central counterparties.

The European Commission also published a Communication, as well a summary report of the European Commission's 2022 targeted consultation on the EU central clearing framework.

The European Commission considers that a safe, and a robust clearing system in the EU is essential for a well-functioning Capital Markets Union. It is concerned about financial stability risks associated with excessive reliance of EU financial markets on UK CCPs, and wants to improve the attractiveness of EU CCPs.

Provisions in the draft Regulation cover:

• measures concerning active accounts to be held by financial and non-financial counterparties subject to the clearing obligation;
• measures amending the procedures authorities should follow to approve new activities or services that CCPs wish to offer;
• measures relating to the equivalence regime for third country CCPs; and
• measures concerning the supervision of CCPs.

The draft Directive:

• introduces limited amendments to CRD and IFD to encourage institutions and investment firms respectively to systematically address any excessive concentration risk that may arise from their exposures towards systemically important third-country CCPs (Tier 2 CCPs); and
• amends the UCITS Directive to eliminate counterparty risk limits for all derivative transactions centrally cleared by a CCP authorised or recognised under EMIR, thereby establishing a level playing-field between exchange traded and OTC derivatives.

9. European Commission: Legislative proposals in relation to the Capital Markets Union

On 7 December 2022, the European Commission issued a package of legislative proposals in relation to the Capital Markets Union (the Listing Act package) designed to make public markets more attractive for EU companies and facilitate access to capital for SMEs:

• a draft Directive amending MIFID to make EU public capital markets more attractive for companies and to improve access to capital for SMEs (Amending Directive);
• a draft Regulation amending MiFIR, MAR and the Prospectus Regulation; and
• a draft Directive on multiple-vote share structures in companies that seek the admission to trading of their shares on an SME growth market.

This follows the publication of the second Capital Markets Union in 2020, which set out plans for simplifying the listing rules for public markets.

The Amending Directive repeals the Listing Directive and transfers its relevant provisions into MiFID II. Other amendments to MiFID include the following:

• changes to the definition of “SME growth markets” to also include the segment of an MTF in the definition;
• a new provision stating that research provided by third parties shall be fair, clear and not misleading;
• conditions clarifying the “issuer-sponsored research” label; and
• increasing from EUR 1 billion to EUR 10 billion the threshold of companies’ market capitalisation below which the unbundling rules do not apply.

Provisions in the Regulation amending MiFIR, MAR and the Prospectus Regulation include the following:

• amendments to the MiFIR framework to specify that a competent authority can request order book data on an ongoing basis to a trading venue under its supervision;
• the introduction of a new EU Follow-on prospectus and a new EU Growth issuance document;
• revisions to the equivalence regime under the Prospectus Regulation for third countries prospectuses;
• harmonising the thresholds for exempting small offers of securities to the public from the prospectus requirement;
• narrowing the scope of the disclosure obligation set out in Article 17(1) of MAR;
• raising the threshold above which managers must notify their transactions from EUR 5 000 to EUR 20 000;
• simplifying the insider lists regime for all issuers by building on the relaxations to the regime introduced by the SME Growth Markets Regulation; and
• making administrative pecuniary sanctions for infringements of disclosure requirements more proportionate.

10. FCA: Updated Webpage: Notification and Disclosure of Net Short Positions

On 2 December 2022, the FCA updated its webpage which sets out the notification and disclosure of net short positions. Specifically, the FCA provided an update in relation to its review of the UK list of exempted shares (as outlined further below).

The FCA published its initial UK list of exempted shares on 31 December 2020. This list contains shares admitted to trading on a UK trading venue as well as on third country venues whose principal venue for trading is outside the UK. The updated webpage informs us that this list is currently under review and the updated list will be published on 30 December 2022.

The main changes to the list will be as follows:

• ESMA's list of exempted shares tab (which forms part of the initial list) will be deleted and should no longer be used;
• the FCA's list will be renamed as 'UK List of exempted shares' and updated with the results of the FCA's liquidity assessment. The webpage confirms that this will have 3 columns to identify 'share ISIN', 'Issuer name' and 'Date added'; and
• the current file structure will remain.

On 30 December 2022, the date of which the new list will be published, there will be further instructions on when the current list will be valid up to and when the new list applies.

11. FCA: Quarterly Consultation Paper No. 38 (CP22/26)

On 2 December 2022 the FCA published the December 2022 Quarterly Consultation Paper (QCP), which included miscellaneous amendments to the FCA Handbook. The FCA's key proposals are summarised below.

Changes to the Derivatives Trading Obligation (DTO)

• The FCA proposes to remove USD LIBOR derivative products from the scope of the DTO. The removal of the relevant products would enter into force from April 2023 and this timeline aligns with the Bank of England's proposed changes to the Derivatives Clearing Obligation (DCO).

Minor amendments to the Enforcement Guide (EG)

• The FCA's amendments to the EG will reflect the Money Laundering and Terrorist Financing (Amendment) (No.2) Regulations 2022 (the Regulations). The Regulations amend the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (MLRs). Under the Regulations, the FCA may exercise its powers of direction on an Annex 1 or cryptoasset business and these powers are subsequently reflected in the minor amendments to the EG, particularly in EG 19.14 and EG 19.5.
• Firms which perform financial leasing, commercial lending and safe custody services will fall within scope of 'Annex 1'.

Clarificatory amendments to the Consumer Duty rules

In relation to authorised firms approving financial promotions on behalf of unauthorised third parties, the FCA proposes that the following aspects of the Consumer Duty will apply in these circumstances:

• Principle 12 of the FCA rules,
• the cross-cutting rules,
• the consumer understanding outcome,
• the rules on monitoring;
• governance; and
• the supporting provisions (such as those relating to reasonableness and redress).

In light of these proposed amendments to the application provisions around financial promotions, the FCA has also proposed some minor amendments to ensure these aspects of the Consumer Duty apply to firms in the Temporary Marketing Permissions Regime (TMPR).

The consumer duty exclusion ensures that certain activities linked to non-retail financial instruments are outside the scope of the Consumer Duty. The FCA has proposed to amend the exclusion, so that it is not available in relation to investment funds. The FCA did not intend for the exclusion to cover instances where firms are designing and distributing funds for retail customers. The FCA is also consulting on a new rule and guidance to clarify the fact that the Consumer Duty does not apply to activities where an exclusion exists in the FCA's sectoral rules.

Clarificatory amendments to MIFIDPRU

The FCA proposes to make a series of changes to the MIFIDPRU legislative framework, including amendments which clarify that the metric for assets under management only need to be considered by an investment firm if it also manages assets;

• amendments to the prudential consolidation rules, in order to clarify that such provisions do not apply to transactions or arrangements that involve counterparties or clients that are external to the investment firm group;
• amendments which clarify the forms which firms must use for the purpose of seeking FCA permission to reduce their own funds instruments;
• amendments which reflect the fact that a firm's listed liquid assets may be treated as 'core liquid' assets; and
• amendments regarding the ICARA process, whereby changes will be introduced to confirm that short-term non-sterling deposits at a UK bank can be treated as non-core liquid assets.

Next Steps

The FCA has asked for comments on the QCP by 9 January 2023.

12. ESMA: Updated Q&A on MiFID II and MiFIR market structures

On 16 December 2022, ESMA published an updated Q&A on MiFID II and MiFIR market structures. One additional question was added, whether an investment firm acting as single liquidity provider on a regulated market and/or a multilateral trading facility can operate a systematic internaliser. The response was that it can, but only if the two activities are fully separated. ESMA notes the possibility of conflicts of interest and states that the investment firm should have distinct teams, have physical separation of activities and have safeguards in place.

13. HM Treasury, CMA, FCA, PSR: Statement on the future of Open Banking

On 16 December 2022, HM Treasury, the CMA, the FCA and the PSR (the Entities) published a joint statement on the work of the Joint Regulatory Oversight Committee (the Committee) in relation to the future of Open Banking. In March 2022, the Entities had announced the establishment of the Committee and the intention to move from the current model of having an Open Banking Implementation Entity with CMA oversight to an interim state whereby a future entity will have Committee oversight in respect of non-CMA Order activities and CMA oversight in respect of CMA Order activities. Eventually, such interim state would cease when the long-term regulatory framework is in place.

The Committee has identified three focus areas – to unlock the potential of Open Banking payments, to adopt a scalable model, and to establish a sustainable footing for the development of the Open Banking ecosystem. The Committee has also set out its expectations for the future entity, including: it should have effective regulatory oversight, it should have a broad-based and equitable funding model, and it should be independent, well-governed and have a culture that is built on integrity and ethical behaviours.

14. BoE (PRA)/FCA: Policy Statement: Margin requirements for non-centrally cleared derivatives

On 15 December 2022, the PRA and FCA issued a Policy Statement on margin requirements for non-centrally cleared derivatives. The proposed amendments will be relevant for PRA-authorised firms which are considered financial counterparties under Article 2 of EMIR / UK EMIR and FCA solo-regulated firms and non-financial counterparties which fall within UK EMIR's margin requirements scope. Following responses to the FCA and PRA's consultation, minor amendments were made to the proposals relating to:

• lengthening the fall-back transition period for firms who will fall within the margin requirements' scope for the first time; and
• increasing the eligibility of EEA UCITS as collateral in order to offer a transition period to enable firms to comply with new requirements regarding the consideration of third country funds as eligible collateral.

The requirements came into force when this policy statement was published. This aligns with the coming into force of the FCA and PRA's final technical standards instrument.

15. BoE: Consultation on the Bank of England's supervisory approach to wholesale cash distribution

On 14 December 2022, the BoE published a Consultation Paper (the CP) on its supervisory approach to wholesale cash distribution under the Financial Services and Markets Bill (the FSM Bill). The FSM Bill, which is currently before Parliament, provides new powers to the BoE to ensure wholesale cash distribution remains effective, resilient and sustainable to support retail access to cash in the UK.

The statutory wholesale cash distribution regime under the FSM Bill has two core parts, being market oversight (to manage the risks to the effectiveness, resilience, and sustainability of wholesale cash distribution in the UK), and prudential supervision (to manage risks that threaten the stability or confidence in the UK financial system or have serious consequences for business or other interests throughout the UK). The CP sets out the BoE's proposals on its approach to achieve the FSM Bill's objectives, which will be undertaken in a proportionate and risk-based way.

The proposals cover:

• The BoE's approach to Wholesale Cash Distribution Oversight;

• the principles for supervision for the Wholesale Cash Distribution Market Oversight Regime;
• high-level codes of practice for participating members (consultation on the detailed legal text will follow in Q1 2023); and
• fees required to fund the BoE's supervisory activity.

Feedback to the proposals set out in the Consultation must be provided by Friday, 10 February 2023.

16. EBA: Consultation Paper: Draft Guidelines on overall recovery capacity in recovery planning

On 14 December 2022, the EBA published a Consultation Paper regarding its proposed Guidelines on the overall recovery capacity (ORC) in recovery planning. The Guidelines are divided into two. The first section targets institutions and aims to assist them with establishing reliable ORC frameworks. The second section is directed towards competent authorities and brings together quantitative and qualitative perspectives to harmonise assessments of the ORC.

The ORC aims to deliver a broad summary of an institution's capability to use recovery options to reinstate its financial position in the aftermath of a significant deterioration. This enables an understanding of the extent to which recovery will be possible and to help institutions prepare for potential crises. One way in which the proposed Guidelines aim to do this is by harmonising practices on the assessment and determination of ORC.

The consultation will remain open until 14 March 2023 and a virtual public hearing will be taking place on 14 February 2023.

17. ECB: Publication: ECB Banking Supervision: SSM supervisory priorities for 2023-2025

On 12 December 2022, the ECB Banking Supervision its supervisory priorities for 2023-2025 against the background of Russia's invasion of Ukraine and the easing of COVID-19 restrictions. Alongside these, it is cognisant of pre-existing inherent structural vulnerabilities, for instance the challenges arising from climate change transition risks and digital transformation. The ECB's priorities are: increasing resilience to immediate geopolitical and macro-financial shocks (observing increasing interest rates, geopolitical tensions and rising inflation);

•  increasing resilience to immediate geopolitical and macro-financial shocks (observing increasing interest rates, geopolitical tensions and rising inflation);
• strengthening the steering capabilities of management bodies and minimising digitalisation challenges (noting a focus on structural risks and obstacles);
• increasing efforts in tackling climate change.

18. EBA: Consultation Paper on New Risk Guidelines

On 6 December 2022, the FCA launched a Public Consultation on the effective management of money laundering and terrorist financing (AML/CTF) risks when providing access to financial services.

Through these Guidelines, the EBA aims to ensure that vulnerable customers, such as asylum seekers from high-risk third countries or homeless people, are not denied access to financial services without valid reason. The Guidelines have been developed in response to the European Commission's request following the publication of the EBA's opinion on de-risking.

Comments to the consultation must be submitted to the EBA by 06 February 2023 and there will be a public hearing on 10 January 2023.

19. HM Treasury: Consultation: Implementation of the Basel 3.1 standards

On 30 November 2022, HM Treasury published its Consultation on the implementation of the Basel 3.1 standards. Its focus is on the legislative and technical changes needed in order to facilitate the PRA's implementation of Basel 3.1. The consultation is seeking views in particular on resolution, equivalence and overseas exchanges. The consultation will close on 31 January 2023.

HM Treasury is also consulting with the PRA, which is keen to receive feedback on all parts of the proposal. The PRA highlights that the proposals narrow the gap between risk weights, which are calculated through the use of internal models through: no longer using internal models in areas such as operational and credit valuation adjustment risk; moving towards risk-sensitive standardised approaches; and the introduction of an "output floor" which is to be introduced, in phases, over a five year period. The PRA's consultation will close on 31 March 2023.

20. PRA: Policy Statement: Amendments to the PRA's approach to identifying other systematically important institutions (O-SIIs)

On 29 November 2022, the PRA published a Policy Statement (the PS) providing feedback to the responses to its Consultation Paper (CP13/22) on amending its approach to identifying systematically important institutions (O-SIIs).

The Consultation Paper proposed amendments to the Statement of Policy (SoP) "The PRA's approach to identifying O-SII's"; as well as to the list of the EU Guidelines in the Annex of the SoP "Interpretation of EU Guidelines and Recommendations: Bank of England and PRA approach after the UK's withdrawal from the EU."

Specifically, the amendments proposed included:

• the removal of the European Banking Authority’s (EBA) scoring methodology from the O-SII identification process and deletion of the EBA Guidelines, such that the scores used to inform O-SII identification are based solely on the PRA’s scoring methodology; and
• updates to specific indicators and weights in the PRA’s scoring methodology for O-SII identification.

The PS contains the PRA's final policy in this regard, which, in response to feedback received on the proposed amendments above:

• adds a paragraph to clarify the interaction of O-SII designation with the O-SII buffer; and
• removes the intention to publish scores and the rationale for any use of supervisory judgement.

In line with this, the PRA has also published the 2022 list of firms designated as O-SII's, which designates 15 firms as O-SII's.

21. ESMA: Final report on guidelines on stress tests for money market funds

On 30 November 2022, ESMA published a Final Report on Guidelines on stress test scenarios under the MMF Regulation. Pursuant to Article 28 of the MMF Regulation, ESMA updates these Guidelines at least every year to reflect recent market developments. ESMA notes recent risks to money market funds, including ongoing effects of COVID and responses to COVID, geopolitical developments, and a stress episode on the GBP money market. The previous version of these Guidelines, known as the 2021 Guidelines, was published on 14 February 2022. The parameters in the newly published Guidelines must be used from the first period to be reported beginning two months after the publication of their translations.

22. FCA: Speech by Emily Sheppard: From Zeroes to Heroes: How culture in financial services can change for everyone's benefit

On 29 November 2022, Emily Shepperd, FCA Chief Operating Officer and Executive Director of Authorisations, delivered a speech on culture in financial services as a way of driving conduct in light of the Consumer Duty (the Speech). The FCA expects senior leaders to foster a healthy environment in the firms they lead, which should place value in robust adherence to regulatory responsibilities and offer a safe environment for employees to speak out and challenge. To show the FCA's seriousness in this regard, the Speech cites the example that 5% of crypto firms who applied for FCA registration showed they understood anti-money laundering rules, while only half of those who seriously engaged with the FCA were registered.

The Speech provides further evidence of the FCA's conviction that "regulating" culture is possible, and provides meaningful insight into the regulatory standards of firms. It also further illustrates that the Consumer Duty will markedly change expectations for firms, and therefore the behaviour of firms on a cultural level.

23. FCA: Decision notice: ICE Benchmark Administration Limited

On 14 December 2022, the FCA published a Decision Notice to ICE Benchmark Administration Limited (IBA), setting out its decision to compel IBA to continue publishing 3 month sterling LIBOR (the Libor Version) for a period of 12 months. This period will start immediately after the final publication of the Libor Version on 30 December 2022.

In its summary of reasons, the FCA confirmed that it has taken the above action on the basis that it considers that the Libor version cannot be ceased at the end of 2022 in an orderly fashion. The FCA states that time is needed for market participants, especially parties to mortgage contracts, to completely transition away from the Libor Version.

The FCA however considers it is important to provide an intended cessation date for the Libor Version and as such, has made it clear that it intends to use its powers to compel IBA to continue to publish the Libor Version for a final period until the end of March 2024, but not beyond that date.

24. FCA: Final Notice: Metro Bank PLC

On 12 December 2022, the FCA has fined Metro Bank PLC and published its final notice concerning fines issued to two of its former directors: Craig Donaldson and David Arden. Metro Bank itself was in breach of the Listing Rules as a result of knowingly publishing inaccurate information, regarding its Risk Weighted Assets figure, to investors. The two former directors were fined as a result of being "knowingly concerned" in the breach. The individuals have referred the decisions to the Upper Tribunal, whereas Metro Bank has not.

25. FCA: Final Notice: Santander UK plc

On 8 December 2022, the FCA issued a Final Notice to Santander UK plc for failing to properly oversee and manage its AML systems between 31 December 2012 and 18 October 2017, which significantly impacted the account oversight of over 560,000 Business Banking Customers. Santander failed to adequately verify information provided by customers about the business they would be doing, and also failed to properly monitor money that customers had stated would be entering into the account, as compared to what was actually being deposited by such customers. These failures significantly raised the risk of financial crime and money laundering, which, accordingly, led the FCA to fine Santander UK on 9 December. Santander did not dispute the FCA's findings with respect to these failures and agreed to settle, discounting the amount of the fine by 30% to a total of £107,793,300.

26. FCA: Final Notice: BGC Brokers LP, GFI Securities Limited and GFI Brokers Limited

On 8 December 2022, the FCA published its Final Notice containing details of fines issued to three broker firms as a result of failure to detect market abuse. The FCA concluded that BGC/GFI failed to adequately implement MAR trade surveillance requirements, which had the consequence of an increased likelihood that trading that is potentially suspicious would not be detected. The case dated back to 2016/17 and the FCA's notice highlighted that the firms had significantly enhanced their MAR trade surveillance activities since the relevant period.

27. Moneybrain Ltd v FCA [2022] UKUT 00257 (TCC)

On 7 December 2022, the Upper Tribunal dismissed an application by Moneybrain Ltd (Moneybrain) for direction to suspend the effect of a Decision Notice issued by the FCA on 30 May 2022 under the Money Laundering Regulations 2017. The FCA's decision refused Moneybrain's application for registration as a cryptoasset exchange provider and custodian wallet provider, which had the effect of terminating Moneybrain's temporary registration to carry on cryptoasset activities. Moneybrain appealed the FCA's decision, which was dismissed by the Upper Tribunal on the grounds that Moneybrain failed to demonstrate that the interests of consumers would not be prejudiced were it to resume its operations in the UK.

28. FCA: Decision Notice: Three bond traders for market manipulation

On 7 December 2022, the FCA published Decision Notices against Diego Urra, Jorge Lopez Gonzalez and Poojan Sheth, three bond traders, for market abuse.

Between 1 June and 29 July 2016, the FCA considers that the traders placed large misleading orders for BTP Futures that they did not intend to execute, giving false and misleading signals and a false misleading impression as to the supply or demand of Italian Government Bond futures. At the same time, they placed small orders which they did intend to execute on the opposite side of the order book.

The FCA considers that the three individuals, who worked at Mizuho International Plc at the time, repeated this pattern of deliberate and intentional market manipulation on a number of occasions and were dishonest. The FCA has banned the three individuals from performing any functions in relation to a regulated activity and has imposed a fine of £395,000 on Mr Urra and £100,000 each on Mr Lopez Gonzalez and Mr Sheth.

29. FCA: Press Release: FCA fines Julius Baer International Limited £18m and publishes decision notices for three individuals

On 30 November 2022, the FCA published a press release detailing the fine issued to Julius Baer International Limited (JBI) and the decision notices banning Louise Whitestone (former relationship manager on the Russian and Eastern European desk of JBI), Thomas Seiler (JBI NED and former Bank Julius Baer (BJB) Sub-Regional (Market) Head for Russia and Eastern Europe) and Gustavo Raitzin (former BJB Regional Head). JBI has been fined for failing to: be cooperative and open with the FCA; take reasonable care in controlling and organising its affairs; and show integrity in conducting its business.

JBI breached FCA Principles 1, 3 and 11 on multiple occasions during the period between March 2007 and July 2014. The FCA has determined that finder's arrangements were facilitated by JBI between BJB and Mr Dimitri Merinson (an employee of several Yukos Group companies). Amongst other issues, a number of uncommercial transactions occurred, whereby above-standard rates were charged to the Yukos Group of companies, the profits of which were then divided between Merinson and Julius Baer.

JBI failed to maintain sufficient policies and procedures to manage risks related to relationships between JBI and finders, including a lack of policies defining rules regarding the use of finders until 2010. Policies existing after that date were insufficient. Further, despite having become aware of the nature of these transactions, JBI did not report these concerns to the FCA until July 2014.

30. JMLSG: Press release: JMLSG publishes revisions

On 23 November 2022, the JMLSG published a press release detailing the draft revisions to its Part I guidance to the financial services sector on anti-money laundering and counter-terrorist financing. Draft versions of the revisions had been published in September 2022 and have recently been submitted to HM Treasury for approval. The areas that have been revised are:

•  enhanced due diligence for high-risk third countries;
• trusts (mainly focusing on beneficial owners and obtaining standard evidence); and
• proliferation financing.

31. FCA: Updated webpage: Consumer Duty - information for firms

On 16 December 2022, the FCA published a new webpage on the Consumer Duty, providing information for firms. It sets out queries that the FCA has frequently been receiving and will remain up-to-date. The webpage sets out clarifications in relation to:

• Consumer Duty Board champions;
•  the meaning of "closed products";
• details on retrospective applications;
• proportionality;
• what is needed from firms which are seeking authorisation;
• communications with regard to portfolio and sector;
•  the application of the Duty throughout the chain of distribution and information sharing;
• the application of the Duty to non-UK firms and customers; and
•  clarification on the scope of the Duty.

32. FCA: Discussion paper (DP22/6): Future Disclosure Framework

On 13 December 2022, the FCA published a Discussion Paper setting out ideas to improve information provided to retail investors.

On 9 December 2022, HMTreasury issued a Consultation Paper on the future of retail disclosure in the UK. This sets out the government's intentions to revoke the Packaged Retail Investments and Insurance Products (PRIIPs) regulation and to remove the Undertaking of Collective Investment in Transferrable Securities (UCITS) disclosure requirements. They intend for future requirements to sit only in the FCA Handbook.

The FCA will now be responsible for designing and developing new disclosure rules which meet the needs of the UK market, supporting investors to make informed investment decisions. This includes how much information to include about costs and charges as well as we the level of investment risk.

The FCA is seeking comments on the Discussion Paper by 7 March 2023, including views on:

•  the delivery of retail disclosure;
•  the presentation of retail disclosure; and
• the content of retail disclosure.

33. HM Treasury Consultation: PRIIPs and UK Retail Disclosure

On 9 December 2022, HM Treasury published a Consultation Paper (CP) which set out the government's intentions to repeal the Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation.

The CP also seeks views on a proposed alternative framework for retail disclosure. Retail disclosure regulations set the rules on the information and documentation, which needs to be provided when a retail customer buys an investment product.

In the CP, the following views or suggestions are provided to improve retail disclosure:

• remove prescriptive requirements and increase flexibility in order to reduce regulatory burdens, such as the highly prescriptive format requirements of the KID;
• regulatory requirements related to retail disclosure should be maintained in FCA rules, rather than in legislation; and
• retail disclosure should ensure that a retail investor understands the nature of the product that they are purchasing to a sufficient degree to enable an informed choice.
  The HM Treasury invites input from stakeholders by 3rd March 2023. These stakeholders include individual retail investors, financial services institutions and consumer groups.

34. FCA: Statement: Guidance for firms supporting their existing mortgage borrowers

On 7 December 2022, the FCA issued draft guidance for firms setting out options that can be used to support existing mortgage borrowers impacted by the rising cost of living.

The guidance focuses on the below two areas:

• Providing forbearance: amongst other things, the FCA states that where a customer indicates that they are experiencing or reasonably expect to experience payment difficulties due to the rising cost of living, firms should offer prospective forebearance to enable them to avoid, reduce or manage any payment shortfall. The FCA further states that firms should have policies, procedures and controls in place to avoid agreeing inappropriate forbearance agreements with customers who have more complex needs (including those who may be in vulnerable circumstances).
• Contract variations: the FCA reminds firms that they may offer a range of contract variations to support borrowers who would like to reduce their monthly payments, and their rules allow this regardless of whether customers are facing payment difficulties. A firm can vary or replace an existing contract without undertaking an affordability assessment provided there is no additional borrowing or change to its terms which is likely to be material to affordability. The FCA provides examples of variations including interest rate switches, term extensions and variation to interest-only.
  The draft guidance seeks to clarify the effect of existing rules and principals as opposed to setting out new expectations or requirements. There is also no statutory requirement to prepare a cost benefit analysis for the guidance.

35. FCA: Portfolio letter: Financial advisers and intermediaries 2022

On 2 December 2022, the FCA published a Portfolio Strategy Letter for Financial Advisers and Intermediaries. It discusses the new Consumer Duty, as well as the complexity of the financial decisions that consumers face, that serve as the backdrop to this letter. The main goals of this portfolio are:

• quality retail advice which is appropriate for the goals and needs of a particular consumer;
• a reduction in victims of investment and pension scams;
• a reduction in firms which are unable to pay compensation due to failures of a firm or attempts to avoid liability, for instance through "phoenixing"; and
• ensuring that consumers receive value-for-money services.

The FCA emphasises in its letter that firms are to consider the possible reasons for unsuitable advice and are to mitigate the chances of it occurring. It highlights the importance of adequate oversight and the role that systems and controls, as well as integrity and individual behaviour and conduct, have to play. Firms are to conduct due diligence on the investments they recommend and be sure that they understand the details of the product in full.

As well as suitable advice, the FCA outlines its view of the risks and its expectations of firms in the areas of: pension and investment scams, firm failure and phoenixing, and ongoing services. It also notes diversity and sustainability as other areas of interest. The FCA reiterates its expectation that firms are to adhere to the rules of a consumer redress scheme. Further, in the coming two years, the FCA will be paying particular attention to retirement income advice.

36. FCA: Clarification on the Scope and Application of the Consumer Duty

On 2 December, the FCA published the December 2022 Quarterly Consultation Paper (QCP). In Chapter 8 of the QCP, the FCA provides clarification on the Consumer Duty's scope and application. These clarifications are consistent with the FCA's position in Consultation Paper CP21/36.
The key clarificatory points are in relation to:

• firms approving and communicating financial promotions;
•  firms in the Temporary Marketing Permissions Regime (TMPR);
• non-retail financial instruments; and
• exemptions in sectoral sourcebooks.
  For further details regarding these topics and stakeholders, please read the entry above, which is titled 'FCA: Quarterly Consultation Paper No. 38 (CP22/26).'

37. FCA: Portfolio letter: Contracts for Difference (CFD) Strategy

On 1 December, the FCA published a Portfolio Letter reminding firms offering contacts for difference (CFDs) that CFDs are highly leveraged derivatives and adverse price movements in relevant markets can lead to substantial losses for consumers.

The FCA outlined their expectations and highlighted areas of poor practice seen in firms. Examples of poor practice referred to in the letter include:

• Scam/churn activities: this is where providers inappropriately use techniques to directly profit from their clients' losses. This can include financial promotions purporting to advertise products other than CFDs which fail to highlight the risks CFDs poses, the use of pressure-sales tactics, excessive or inappropriate fees and the refusal to process requested withdrawals;
• Circumvention of FCA Rules: the FCA highlighted that some firms circumvent FCA Rules by inappropriately 'opting-up' retail customers to 'elective-professional' status, sometimes using banned incentives. Other firms circumvent FCA rules by directing retail customers to associated CFD providers incorporated in third country jurisdictions without equivalent consumer protections. The FCA highlighted that these third country entities illegally provide regulated activities to UK clients outside the provisions of the Overseas Persons Exclusion; and
• Affiliate marketers/introducers: many firms use unauthorised affiliates to introduce clients, paying them for introductions. The FCA highlighted that firms' oversight of affiliates is often inadequate. Concerns were also raised in relation to affiliates conducting regulated activities without authorisation.

The FCA also touched upon the Consumer Duty in the Portfolio Letter and reminded firms that they should consider their obligations under the Consumer Duty which sets out higher standards of consumer protection across financial services. The FCA flagged the following areas of the Consumer Duty as likely to be the most relevant to CFD firms:

• cross-cutting rules on acting in good faith;
• rules on price and value;
• rules on customer service; and
• rules on communications.

The Portfolio Letter also addressed the need to deliver assertive action on market abuse and also reducing harm from firm failure.

By the end of January 2023, the FCA expects all CEOs to have discussed this letter with their fellow directors/Board and to have agreed actions and/or next steps.

38. FCA: Consultation Paper: Broadening Access to Financial Advice for Mainstream Investments (CP22/24)

On 30 November 2022, the FCA published a Consultation Paper (the CP) providing proposals for a new core investment advice regime which seeks to ensure mass-market consumers can be provided with greater access to simplified, cheaper advice on investing into mainstream products, specifically stocks and shares ISAs. The aim, is a 20% reduction in the number of consumers with higher risk tolerance holding over £10k in cash by 2025.

Specifically, the FCA seeks feedback on:

• streamlining the customer ‘fact find’ so advice is more straightforward for both firms and customers;
• limiting the range of investments within the new regime so the advice is easier to deliver and understand;
• making the qualification requirements for the new regime more proportionate so delivering simplified advice is less costly for firms; and
• allowing advice fees to be paid in instalments so customers aren’t burdened by large upfront bills.

Responses to the CP are to be provided by 28 February 2023. The FCA will publish a final policy statement and finalise the rules and guidance in spring 2023, targeting implementation of the regime before March 2024 such that firms will be able to start offering core investment advice from the beginning of April 2024.

39. PSR: Working Paper: impact of the UK-EEA Cross-Border Interchange Fee increases working paper

On 15 December 2022, the Payment Systems Regulator (PSR) published a Working Paper outlining its views on the potential impacts of cross-border interchange fee increases on UK businesses and consumers (the Paper). Since Brexit, Visa and Mastercard have increased interchange fees on UK-EEA payments for 'card-not-present' transactions (where the cardholder is not present, such as online or mobile payments) five-fold (from 0.2% to 1.15% for debit cards, and 0.3% to 1.5% for credit cards). This fee increase will impact all UK businesses which accept such online payments and as a result, may be passed on to consumers.

The Paper considers how UK service users may have been harmed by such fee increases and how merchants or acquirers may mitigate the impact of these fees. Feedback on the Paper can be provided until 5pm on Thursday 19 January 2023.

40. HM Treasury: Consultation: Reforming the Consumer Credit Act 1974

On 9 December 2022 the HM Treasury published a Consultation Paper (CP), which sets out the first stage of reform to the Consumer Credit Act 1974 (CCA). The CP also asks questions about how the consumer credit regulatory environment could be changed to ensure optimal performance of regulation surrounding customer communications, consumer protections and sanctions for firms that do not comply to regulatory standards.

The five principles which underpin the reform are as follows:

•  proportionality: the reform will ensure that levels of consumer protection will be appropriate, whilst balancing the need to ensure that the reform places proportionate burdens on business;
• alignment: the reform will be aligned with the implementation of the Future Regulatory Framework (FRF), will complement and support the Consumer Duty requirements and will ensure consumer credit regulation broadly aligns with the style and substance of current financial services regulation whilst recognising that due to the nature of consumer credit a tailored approach may be required in specific areas;
• forward-looking: the reform will be mindful that changes made to the consumer credit and consumer hire regulatory landscape should be adaptable to future ways of delivering credit and consumer hire to consumers;
• deliverable: the reform will be designed to be deliverable for the financial services regulators and industry; and
• simplified: the reform will simplify the ambiguous technical terms used in the CCA to make it clear to consumers what protections they have and to make it easier for firms to communicate these protections to customers or clients.

HM Treasury invites input from stakeholders by 17 March 2023.

41. PSR fines Barclays Bank for breaking interchange fee rule

On 1 December 2022, the Payment Systems Regulator (PSR) imposed a fine of £8.4 million on Barclays Bank PLC for failing to comply with the Interchange Fee Regulation (IFR). The Decision Notice can be found here.

When consumers pay by card, retailers have to pay fees in order to accept the payment and these fees can be passed on to consumers in the form of higher prices. The PSR has taken action as it found that Barclays did not provide retailers with the required transaction information in order to enable them to easily understand the transaction fees associated with accepting certain types of card payments. This failure meant retailers weren't fully aware of the fees they were paying so could not effectively compare prices of card services (i.e. to shop around to find cheaper deals or negotiate the best deal with Barclays). This could ultimately have saved them and their customers money.

The PSR’s investigation identified that Barclays failed to comply with the IFR from December 2015 to December 2018, during which Barclays processed a third of all card payment transactions in the UK. This meant thousands of retailers and transactions were affected.

42. EPC: First SEPA Payment Account Access Rulebook published

On 30 November 2022, the EPC published the first SEPA Payment Account Access (SPAA) scheme Rulebook. This follows a June 2021 ERPB Working Group report as well as feedback gathered during a three month public consultation which ended on 12 September 2022. The purpose of the Rulebook is to set out rules, practices and standards for any eligible asset broker or asset holder to participate in the SPAA scheme. Subject to EPC board approval, an amended version of the Rulebook is expected in 2023, which is expected to include the definition of a minimum viable product. The Rulebook will become effective from 30 November 2023.

43. ESMA: Q&A on a pilot regime for market infrastructures based on distributed ledger technology

On 16 December 2022, ESMA published a Q&A on the implementation of Regulation (EU) 2022/858 of the European Parliament and of the Council of 30 May 2022 on a pilot regime for market infrastructure based on distributed ledger technology (the DLT Pilot Regime). The final legislative text of the Regulation was approved by the European Parliament and the Council of the European Union on 30 May 2022 and entered into force on 22 June 2022. The DLT Pilot Regime itself will be applicable from 23 March 2023.

The Q&A covers the application of the DLT Pilot Regime with respect to regulatory data reporting, trading and settlement.

44. ESMA: Draft Final Report: Guidelines on standard templates, forms and formats to apply for permission to operate a DLT market infrastructure

On 15 December 2022, ESMA published its Draft Final Report including guidelines on standard forms, formats and templates to apply for permission to operate a DLT market infrastructure (the Guidelines).

Key features of the Guidelines include:

• templates to be used by market participants to apply for specific permission to operate any type of DLT market infrastructure under the DLT Pilot Regulation. This includes a DLT MTF, a DLT settlement system or a DLT trading and settlement system; andtemplates to be used for DLT market infrastructure to request limited exemptions from specific requirements under MiFIR, MiFID II or CSDR, provided that they comply with certain conditions.

The Guidelines will be published on the ESMA website in the EU official languages in the coming weeks. The Guidelines will enter into force on 23 March 2023.

45. FCA: Updated webpage: Climate Financial Risk Forum

On 19 December 2022, the FCA updated its webpage on the Climate Financial Risk Forum (CFRF) to reflect the CFRF's new publication on 13 December, of its third round of guides to help the financial sector develop its approach to addressing climate-related financial risks and opportunities. The CFRF is a forum established in 2019 to bring together senior financial sector representatives to share their experiences in managing climate-related risks and opportunity.

The guides, listed under the new section titled "Session 3 Guide" of the FCA webpage, are written per industry by three working groups within the CFRF which focus on the transition to net zero, scenario analyses, and climate disclosure, data and metrics. The guides include:

• Scenario analysis guides:
• Scenario analysis guides for banks
• Scenario analysis in financial firms

• Physical risk underwriting guides
• Transition to Net Zero Guides
• A Carbon Budget Primer in Financial Institutions
• Disclosures: Managing Legal Risks
• Mobilising Investments into Climate Solutions – Phase 1 Report

• Disclosure, Data and Metrics Guide
•  Disclosure, Data and Metrics – Industry Frameworks and Metrics in Relation to Green & Transition Finance

Session 3 of the CFRF commenced on 27 April 2022, and will run for approximately 12 months. The CFRF working groups will complement additional workstreams such as the UK-Government Transition Plan Taskforce, and the Glasgow Financial Alliance for Net Zero (GFANZ).

46. EBA: Roadmap on sustainable finance

On 13 December 2022, the EBA published its roadmap on sustainable finance and environmental, social and governance (ESG) risks. The new roadmap supersedes the EBA's December 2019 action plan on sustainable finance. It seeks to build on actions from the 2019 action plan while incorporating recent developments, including new mandates and new areas of focus. The eight key objectives of the roadmap are: transparency and disclosures; risk management and supervision, prudential treatment of exposures; stress-testing; standards and labels; greenwashing; supervisory reporting; and ESG risks and sustainable finance monitoring.

47. FCA: Multi-firm review: Understanding approaches to D&I in financial services

On 12 December 2022, the FCA published its observations on the ways in which firms are approaching diversity and inclusion strategies. The FCA is encouraging all firms to assist in developing inclusive industries and healthy cultures where market integrity and consumer protection are delivered. The FCA's review aimed to: provide a broad overview of the current state of diversity and inclusion policies; to encourage more action within industry; and assist the FCA with building a way to supervise and engage with firms. The FCA reports that it was surprised to find consistency approaches across the 12 firms they observed. They had all started making serious progress with their approaches in the last couple of years but there were varying levels of commitment to the development of these policies. They observed a lack of holistic thinking and some signs of a compliance-driven approach, rather than true commitment to diversity and inclusion.

48. FCA: New webpage: Section 165 request for principal firms

On 8 December 2022, the FCA published a new webpage reminding principal firms that they must respond to the FCA's Section 165 request about appointed representatives (ARs).

By way of background, between 08 and 12 December, the FCA sent principal firms mandatory Section 165 data request asking for more information about ARs. Firms have until 28 February 2022 to respond.

The webpage confirms that firms must provide the following information about their ARs and introducer ARs (IARs):

• the reasons for any appointments;
• the nature of their regulated business;
• whether any unregulated business is conducted and, if so, the nature of this business;
• anticipated revenue;
• the nature of financial arrangements between you, as the principal, and your AR(s); and
• complaints information and whether the AR is part of a group.

49. ESMA: Report: Peer review into the NCA's handling of relocation to the EU in the context of the UK's withdrawal from the EU

On 8 December 2022, ESMA published its Peer Review Report on National Competent Authorities' (NCAs) handling of firms' relocation to the EU in the context of the UK's withdrawal from the EU.

The Peer Review Report gives further insight into the supervisory approaches adopted by NCAs when authorising relocating firms in the scope of Brexit.

Key findings from the report include:

• NCAs allowed in certain cases for an extensive use of outsourcing/delegation arrangements; and
• several firms relocated with limited technical and human resources in the EU. In particular, NCAs applied different interpretations of proportionality when it came to substance requirements. This led in certain cases to some smaller firms relocating with only very minimal set-ups.

With regards to next steps, ESMA will continue to facilitate and coordinate further convergence work at EU level and also expects work to be conducted at national level to address findings and recommendations made in the report. It is also planned to carry out a follow-up assessment in two years to see how the situation has evolved.

50. FCA: Consultation paper: Introducing a gateway for firms who approve financial promotions (CP22/27)

On 6 December 2022, the FCA issued a Consultation Paper "Introducing a gateway for firms who approve financial promotions" (CP 22/27). This follows HM Treasury's response to its consultation on financial promotions in which it confirmed it would prohibit authorised firms (existing or new) from approving financial promotions for unauthorised persons, unless they've received FCA authorisation to do so via a financial promotions "gateway" (see our briefing here). The Financial Services and Markets Bill 2022-23 contains legislation to this effect.

CP 22/27 sets out how the FCA plans to operationalise the new gateway including:

• how the FCA will assess applicants and the basis for granting or refusing applications;
• bi-annual reporting requirements; and
• requiring approved firms to notify the FCA when they approve, or amend or withdraw approval of, a financial promotion, within 7 days of doing so.

For more information, please see our briefing here.

51. HM Treasury, FCA and PRA: Letters on regulators' operational effectiveness

On 1 December 2022, HM Treasury published letters from it to the FCA and the PRA on operational effectiveness, along with their responses. The Economic Secretary to the Treasury indicated that he would welcome an update on the FCA's plans to increase efforts to be world-leading in terms of operational effectiveness and on the PRA's plans to increase transparency on efforts to be world-leading in terms of operational effectiveness.

The FCA Chief Executive's response outlined the following improvement areas: publishing authorisations metrics four times a year rather than annually; and publishing the lower, median and upper quartile of time taken to determine applications in each category.

The PRA Deputy Governor and CEO's response set out the following enhancements they aim to implement: reporting four times a year on authorisations metrics; providing more data on the time taken to decide cases; and, where possible, providing metrics that are specific to categories of firms (i.e. whether they are deposit-takers or insurers).

52. LSB: Memorandum of Understanding between the FCA and LSB

On 1 December 2022, it was announced that the FCA and LSB entered into a Memorandum of Understanding (MoU) in relation to the oversight of UK lending activity. The MoU confirms that the FCA and LSB will seek to:

• co-operate in a timely way with regard to their respective roles;
• maintain general awareness and understanding of each other’s functions;
•  share good practice regarding monitoring and enforcement methodology in areas of overlap; and
•  meet as necessary to seek to achieve these benefits, including regular meetings at staff level and meetings at least annually at senior management level.