The Bank of England (BoE) has published an update on the ongoing design phase of the digital pound, a proposed form of central bank digital currency intended to complement existing payment methods. While no decision has yet been made on its introduction, the focus over the past year has been on developing a detailed blueprint, supported by design notes and practical experimentation through the Digital Pound Lab. The blueprint is expected to be published in 2026.

This work aims to deepen understanding of how public money could operate within a multi-money system and will inform a joint, evidence-based assessment by the BoE and HM Treasury in 2026. In parallel, payment trends in the UK and internationally will continue to be monitored to support this assessment. If a decision is made to proceed, a digital pound would only be introduced following the passage of primary legislation by the UK Parliament. The BoE will continue targeted experiments and stakeholder engagement to explore what is viable and what may need to change.

The UK Financial Conduct Authority (FCA) has published a letter addressed to asset management and alternative firms outlining its expectations ahead of the UK's transition from T+2 to a T+1 securities settlement cycle, effective from 11 October 2027. The FCA has identified that some small and medium-sized asset managers and alternative investment firms may not yet be fully aware of the operational changes required. As such, the FCA reiterates its expectations and urges all impacted firms to proactively assess their readiness. With two years remaining, firms are expected to plan now to ensure their settlement processes, particularly those reliant on manual workflows, are sufficiently automated to meet the demands of a shortened settlement cycle.

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The UK Financial Conduct Authority (FCA) has published Primary Market Bulletin 59 (PMB59). It begins with findings from a review of issuers' compliance with Article 17.4 of the UK Market Abuse Regulation (MAR) on delayed disclosure of inside information (DDII) under certain conditions. Notably, the FCA observed a 39% drop in DDII notifications, alongside an increase of approximately seven days in average delay periods compared to its previous review in November 2020. While this could be due to fewer instances of information being classified as inside information, or a reduced use of delayed disclosure rather than non-compliance, the FCA reminds issuers of their obligations under UK MAR, including timely DDII submissions and maintaining confidentiality.

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The Financial Conduct Authority (FCA) has updated its Climate Financial Risk Forum (CFRF) webpage, announcing the release of a comprehensive suite of publications aimed at enhancing the financial sector's capacity to manage climate and nature-related risks. These are set out below.

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The UK Financial Conduct Authority (FCA) and the UK Payment Systems Regulator (PSR) have published a joint response to HM Treasury's consultation on consolidating the PSR's functions within the FCA's legislative framework. Both regulators support the proposed integration, agreeing with the overarching approach to the consolidation, and believe that the proposed model enables a coherent and holistic view of regulatory issues that impact payment systems and payment services. Their response outlines work already completed as well as ongoing efforts to prepare for the transition. In terms of next steps, beyond development of the detailed legislation, and in the longer term, they consider that there may be aspects of the FSMA regime that may be appropriately adapted to payment systems regulation. There may also be further opportunities to review how the developing regime for the regulation of activities involving stablecoins or other crypto-assets fits together with the regulation of systems that use such technology to transfer funds. In the accompanying annex, the PSR and FCA set out their responses to the specific consultation questions. You may also like to read our opinion piece "UK Payment Systems Regulator to be abolished - what's next?" which explores key considerations and potential impact of the transition of the consolidation.

The European Securities and Markets Authority (ESMA) has published its final report with draft regulatory technical standards (RTS) that establish an EU code of conduct for issuer-sponsored research. The RTS supplement the revised Markets in Financial Instruments Directive, as amended by the Listing Act Directive. Under the revised framework, research distributed by investment firms to clients or potential clients that is paid for, fully or partially, by an issuer must be labelled as "issuer-sponsored research". No substantive changes have been made following the December 2024 consultation. A feedback statement is included in the final report in section 3. While the code is non-binding, ESMA emphasises that all research providers (whether independent or not) must comply with the EU code of conduct if they wish their analysis to be labelled and distributed as "issuer-sponsored research", otherwise it would have to be labelled as a marketing communication. The final draft RTS have been submitted to the European Commission for adoption, who has three months to decide whether to adopt them. If adopted, they will apply from 6 June 2026.

The European Parliament has rejected the negotiating mandate, adopted by its Legal Affairs Committee on 13 October, on the Omnibus I package on simplified rules for sustainability reporting and due diligence. The Legal Affairs Committee's report (A10-0197/2025) was published on 17 October. Members of the European Parliament will vote on amendments to the file at the upcoming plenary session in Brussels on 13 November, after which trilogue negotiations with the Council of the EU and the European Commission may begin. The Council of EU adopted its mandate in June. The aim is to finalise the legislation by the end of the year.

The European Banking Authority (EBA) has released its fifth and final report on the functioning of anti-money laundering and countering the financing of terrorism (AML/CFT) colleges, covering the period from 1 January 2024 to 31 May. Overall, the EBA found that the state of the colleges framework has remained stable since December 2023. It concludes that these colleges have been effective in facilitating information exchange and strengthening AML/CFT supervision across the EU. However, the EBA identifies limited progress by supervisors in addressing two key priorities: (i) applying a risk-based approach in the functioning of AML/CFT college meetings meaning that resources were not always allocated to the most strategically important colleges; and (ii) ensuring systematic, meaningful discussions on coordinated responses to shared risks. From 1 January 2026, oversight of AML/CFT colleges will transition to the new Anti-Money Laundering Authority (AMLA), with the EBA's findings expected to inform AMLA's supervisory framework going forward.

The European Securities and Markets Authority (ESMA) has published its final report on the draft regulatory technical standards (RTS) for open-ended loan-originating alternative investment funds (OE LO AIFs), pursuant to the Alternative Investment Fund Managers Directive (AIFMD). Following consultation feedback, ESMA has made the following changes to the draft RTS: removed the requirement for Alternative Investment Fund Managers (AIFMs) to determine a target appropriate amount of liquid assets, instead AIFMs must ensure their OE LO AIFs have sufficient liquidity to honour redemption requests; revised the frequency of liquidity stress testing, requiring AIFMs managing OE LO AIFs to conduct such tests at least annually, rather than quarterly as previously proposed and; clarified certain provisions to improve interpretability. The final draft RTS have been submitted to the European Commission for adoption but, as the RTS are classified as non-essential Level 2 acts, they are not expected to be adopted before 1 October 2027 at the earliest.

The Better Data Sharing Regulation (Regulation (EU) 2025/2088) has been published in the Official Journal of the European Union (OJ). The regulation introduces targeted amendments to certain reporting requirements in the fields of financial services and investment support. It amends seven foundational EU laws to streamline supervisory reporting and improve data sharing among EU financial authorities. Key features include: (i) a requirement for the European Supervisory Authorities, through the Joint Committee and in cooperation with other EU bodies, to deliver a feasibility report within five years on a cross-sectoral integrated reporting system. Based on its findings and a comprehensive impact assessment, the European Commission may, where appropriate, put forward a legislative proposal; (ii) calls for consistent application of the "report once" principle, whereby authorities should obtain information from other authorities that have already collected it, rather than requesting it again from reporting entities, provided this does not compromise the entities' ability to perform their tasks; (iii) a shift from biannual to annual reporting under the InvestEU Programme; (iv) clarification of the scope and conditions for both mandatory and voluntary data sharing; and (v) encouragement for authorities to enter into memoranda of understanding to support information exchange. The Regulation will enter into force on 10 November.

The European Commission (EC) has published a communication alongside a fact sheet outlining its 2026 work programme, which sets out a comprehensive legislative and policy agenda to strengthen the EU. The programme includes 38 new policy objectives across key areas including energy, defence and digital innovation, among others.

Key initiatives include the European Innovation Act, Cloud and AI Development Act and Quantum Act, which seek to accelerate technological progress and support the EU's digital transition. In the area of sustainable finance, the EC includes a package of measures for "the decade ahead" on climate and the Energy Union, aiming to strengthen the EU's climate and energy frameworks. These measures include revising national targets, updating the emissions trading system, and establishing new infrastructure and regulatory frameworks for CO₂ transport, energy efficiency and renewables. A notable focus of the programme is regulatory simplification, with over half of the legislative initiatives designed to reduce administrative burdens and deliver net cost savings, particularly for small and medium-sized enterprises. The annexes accompanying the work programme list the new initiatives, pending proposals and those the EC proposes to withdraw, among other elements.

HM Treasury (HMT) has published its consultation response and policy statement on the reform of the anti-money laundering and counter-terrorism financing (AML/CTF) supervision regime, following its 2023 consultation. The consultation had proposed four potential models to reform the current supervisory framework, which comprises of three public sector supervisors, namely the UK Financial Conduct Authority (FCA), the Gambling Commission and HMRC, as well as 22 professional body supervisors (PBSs) responsible for overseeing the legal and accountancy sectors' compliance with the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. HMT now confirms its intention to implement the Single Professional Services Supervisor (SPSS) model. Under this model, the FCA will become the sole AML/CTF supervisor for in-scope legal service providers, accountancy service providers and trust and company service providers, consolidating supervisory responsibilities previously held by 23 separate bodies, with the aim of improving consistency, effectiveness and coordination across the regime.

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HM Treasury has published a policy paper, setting out a six-month progress update to the UK Government's Regulation Action Plan, originally launched in March. It reflects on commitments it has delivered upon, including with UK regulators, and outlines a series of forward-looking initiatives aimed at reducing regulatory burdens and fostering economic growth in several key areas for financial services which are set out below.

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The European Securities and Markets Authority (ESMA) has published its final report on the draft implementing technical standards (ITS) extending the use of the alleviated format of insider lists to all issuers under the amended Market Abuse Regulation (MAR), as mandated by the Listing Act (Regulation (EU) 2024/2809). The draft ITS consolidates the existing five insider list templates into three: two templates for event-based and permanent insider lists applicable to non-SME issuers and SME Growth Market issuers in Member States that have opted out of the simplified regime, and a third template for SME GM issuers under the simplified regime, covering persons with regular access to inside information.

Following its April consultation, ESMA has made no major changes to the templates. It maintained its view that all issuers should report the national identification number of insiders, and where not applicable, their date of birth. ESMA also added a recital clarifying that issuers may include one contact person per external provider with access to inside information. The draft ITS has been submitted to the European Commission, which has three months to decide whether to adopt them.

The UK Department for Science, Innovation and Technology (DSIT) has announced its plans to establish an AI Growth Lab, a new blueprint for AI regulation. This regulatory sandbox is designed to support responsible AI innovation by allowing firms to pilot AI technologies in real-world conditions, under temporary and closely supervised environments. The Lab would operate issue specific sandboxes, focusing on sectors where there is opportunity for innovation and adoption, but where regulatory modification may be needed and existing regulatory sandboxes are not in place. Within the Lab, certain regulations may be temporarily "switched off" or adjusted for a limited period to enable experimentation.

Target sectors include professional services, healthcare, transport and advanced manufacturing. DSIT has issued a call for views to help shape the Lab's operating model. The proposals cover its design (including whether it should be centrally operated by the government or relevant regulator-led on a sandbox-by-sandbox approach), application criteria, necessary safeguards and the length of the sandbox. DSIT is also considering powers for government to make permanent responsible regulatory modifications, validated through Lab testing, by secondary legislation. This would be subject to appropriate parliamentary scrutiny. If adopted, this mechanism would mean that the Lab is not only a safe and controlled way to trial responsible AI, but also a driver for dynamic regulatory reform. The deadline for responses is 2 January 2026. During the response window, DSIT will organise roundtables for stakeholder and public engagement.

The Bank of England, UK Financial Conduct Authority (FCA) and UK Prudential Regulation Authority (PRA) have published a joint document outlining effective practices in cyber response and recovery capabilities across systemic firms and financial market infrastructures (FMIs). The publication highlights practices drawn from firms' operational resilience self-assessments and is structured around the following four key areas:

• Response to a high severity cyber disruption – maturer firms are using a broader set of impact tolerance metrics, beyond just duration, to define critical service levels. These include metrics such as value, volume, critical activity, end-users and types of payments. Effective self-assessments also feature clear, timely crisis communication plans and resilient communication capabilities.

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The European Systemic Risk Board (ESRB) has published a report highlighting trends and systemic risks associated with the crypto-asset ecosystem, with a particular focus on stablecoins, crypto-asset investment products and multi-function groups:

• The report notes that global stablecoin market capitalisation has more than doubled since the ESRB's previous assessment in May 2023, driven in part by U.S. policies promoting the adoption of U.S. dollar-denominated stablecoins. The ESRB flag policy challenges in ensuring that stablecoins issued outside the EU that are non-compliant with MiCAR are not widely used within the EU. The ESRB also flags financial stability risks posed by stablecoins jointly issued by EU and third-country entities, noting that such schemes are not explicitly addressed under the current Markets in Crypto-Assets Regulation (MiCAR).

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The UK Financial Conduct Authority (FCA) has published findings from its multi-firm review of client categorisation practices in corporate finance firms. The review assessed compliance with COBS 3 and COBS 4 requirements and identified both good practices and areas for improvement. While most firms conducted client categorisation assessments under COBS3, many were found to be superficial, lacking supporting records and relying on invalid criteria, particularly in elective professional categorisations. The FCA expects firms to use structured assessments to evaluate whether a client meets the specific criteria in COBS3.5.3R for the elective professional categorisation and to keep adequate supporting records.

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The UK Financial Conduct Authority (FCA) has published its findings from a recent survey on financial crime controls in corporate finance firms not required to submit financial crime data returns. The findings reflect firms' self-reported practices and are not based on an FCA review. They highlight both good practices and areas needing improvement. Approximately two-thirds of respondents may be non-compliant with one or more aspects of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (Money Laundering Regulations). Key deficiencies include the absence of documented business-wide risk assessments, gaps in customer due diligence and inadequate oversight of appointed representatives. Despite these concerns, the FCA did identify good practices, such as regular reporting to senior management and the use of risk registers. The FCA has begun contacting firms falling short of expectations to prompt remedial action and will follow up to assess progress. Firms are reminded of their obligations under the Money Laundering Regulations and are expected to address identified gaps in their financial crime frameworks.

The UK Financial Conduct Authority (FCA) has updated its webpage on the proposed motor finance consumer redress scheme consultation to announce the launch of a data room. The facility is intended to support stakeholder engagement during the consultation period, which closes on 4 November. The data room provides controlled access to underlying datasets relevant to the FCA's analysis of consumer loss, particularly in relation to the APR adjustment remedy and high commission arrangements. Access is restricted to individuals with demonstrable expertise in handling large datasets and financial modelling and is granted solely for the purpose of responding meaningfully to the consultation. Entry is conditional upon signing a confidentiality agreement. The FCA clarifies that the data room is not designed to enable firms to calculate their own redress liabilities, as they would need to calculate this from their own data.

A draft of the Financial Services and Markets Act 2023 (Prudential Regulation of Credit Institutions) (Consequential Amendments) Regulations 2025 has been laid before the UK Parliament, and published together with a draft explanatory memorandum. The draft regulations are part of the UK's continued process to repeal and replace assimilated EU financial services law following Brexit, under the Financial Services and Markets Act 2023 (FSMA 2023). Under section 1 of FSMA 2023, several provisions of the UK Capital Requirements Regulation (UK CRR) will be revoked, effective from 1 January 2026, by virtue of the FSMA 2023 (Commencement No. 10 and Saving Provisions) Regulations 2025. These provisions, which set prudential standards for credit institutions and investment firms, will largely be replaced by rules made by the UK Prudential Regulation Authority (PRA) and the Bank of England.

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The European Securities Markets Authority (ESMA) has published two Q&A's relating to the Markets in Crypto-Assets Regulation (MiCAR): (i) ESMA_QA_2653 provides guidance on how crypto-asset service providers (CASPs) should distinguish between different types of execution services; and (ii) ESMA_QA_2654 clarifies the respective responsibilities of offerors, persons seeking admission to trading, trading platform operators and other CASPs referenced in Article 66(3) of MiCAR, relating to white papers for crypto-assets (excluding asset-referenced tokens and e-money tokens) that were admitted to trading before 30 December 2024.

The UK Financial Conduct Authority (FCA) has published its findings from a multi-firm review assessing how UK payment service providers (PSPs) (including banks and other businesses offering payment accounts) detect and respond to romance fraud, a growing financial crime where victims are deceived into sending money to fraudsters who engineer false romantic relationships or friendships. The review covered 60 cases across six firms and the conclusions highlight examples of good practice and areas for improvement. Whilst some firms are leading the way with proactive engagement and compassionate support reflecting best practice, these examples were not consistent across the industry and it is clear that staff play a critical role in interventions. Equally, the review also examined the effectiveness of firms' systems and controls in detecting romance fraud, to avoid missed opportunities to detect suspicious activity, including transactions to overseas jurisdictions, multiple payments over a short period and sudden increases in the value of funds being sent.

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HM Treasury (HMT) has announced the launch of the "Office for Investment: Financial Services" a new free one-stop support service designed to make the UK more attractive to global financial services investors. The service operates through a partnership between HMT, UK financial regulators including the UK Financial Conduct Authority and the UK Prudential Regulation Authority, and the City of London Corporation. It aims to help international financial firms expand their operations in the UK, including in financial clusters such as Leeds, Liverpool, Belfast and Bristol, removing barriers to investment, offering regulatory assistance and providing broader business support. The launch delivers on commitments made in the Chancellor of the Exchequer, Rachel Reeves, Mansion House speech and forms part of the government's broader strategy to strengthen the UK's position as a global financial hub.

The International Transition Plan Network (ITPN) has launched a new interactive global map to help track the regulatory status of climate-related transition plans across jurisdictions. The map allocates jurisdictions into one of three categories: (i) mandatory, where rules or guidance are in force; (ii) upcoming, where mandatory rules are under development; and (iii) voluntary, where guidance encourages disclosure. The map will be regularly updated, with stakeholders invited to contribute to its accuracy.

The UK Financial Conduct Authority (FCA) has published Primary Market Bulletin 58, setting out updates to its guidance in the Knowledge Base, in preparation for the new Public Offers and Admissions to Trading Regulations (POATRs) regime, which will take effect on 19 January 2026. Specifically, the FCA: (i) confirms that from 1 December, issuers will be able to submit draft prospectuses, registration documents, and other relevant materials for review, with a view to seeking formal approval on or after 19 January 2026. The FCA intends to publish updated forms and checklists on its webpage to accompany these submissions; and (ii) provides feedback on its consultation in PMB 57, finalising two technical notes, TN 710.2 (Sponsor Services: Principles for Sponsors) and TN 638.1 (Complex Financial Histories and Significant Financial Commitments).

Additionally, the FCA is consulting on new draft technical notes described in policy statement PS25/9, which are intended to take effect alongside the POATRs regime, proposes updates to 42 existing notes and the deletion of seven notes from the Knowledge Base. The deadline for comments on the four new technical notes and proposed updates to PN 902, TN 602, TN 619, TN 628, TN 801 and TN 802 is 5 December. For all other notes it is 21 November. The FCA plans to finalise these updates in a further Primary Market Bulletin to be published shortly before the new rules come into force in January 2026.

The Single Resolution Board (SRB) has launched a consultation on new operational guidance for banks' communication in resolution scenarios, along with a communication testing supplement to its existing operational guidance on resolvability testing for banks. The consultation aims to enhance the timeliness, accuracy and consistency of communication from banks when they are failing or likely to fail. It builds on the SRB's expectations for banks and further clarifies the strategic communication expectations during resolution. Key areas covered include: (i) coordination between banks and the resolution authorities; (ii) consideration of moratorium tools under the Bank Recovery and Resolution Directive in communication planning; (iii) banks' communication plans for resolution; and (iv) governance arrangements for communication during resolution.

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Regulation (EU) 2025/1958 of the European Central Bank (ECB), amending Regulation (EU) 2015/534 on the reporting of supervisory financial information (the Financial Reporting Regulation) under the Single Supervisory Mechanism (SSM), has been published in the Official Journal of the European Union. Adopted on 9 September, the Regulation amends the Financial Reporting Regulation to allow the ECB to collect additional data from less significant credit institutions and branches with total assets of EUR3 billion or less. The additional information is considered necessary for the ECB to foster comparability of the outcomes of the supervisory review and evaluation process assessment. The Regulation enters into force on 6 November and will apply from 30 December.

The Financial Stability Board (FSB) has published a thematic peer review report assessing the implementation progress of its 2023 global regulatory framework for crypto-asset activities. As of August of this year, the review shows that while many jurisdictions have made notable progress in regulating crypto-asset activities, there has been slower progress in finalising their global stablecoin arrangements (GSCs). Even where regulatory frameworks have been finalised, alignment with FSB recommendations remains limited, especially regarding stablecoin arrangements and crypto-asset service providers (CASPs). These gaps could pose risks to financial stability and to the development of a resilient digital asset ecosystem.

In response to the concerns, the report sets out eight recommendations to address outstanding issues in the following key areas set out below.

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The Bank of England (BoE) has published the terms of participation for its upcoming Synchronisation Lab which will support the testing and refinement of a proposed synchronisation capability for the UK's renewed Real-Time Gross Settlement (RTGS) service, RT2. Synchronisation would allow for atomic settlement in central bank money: the conditional settlement of funds in RT2 against assets on a variety of external asset ledgers, meaning that funds in RT2 will settle if and only if the external asset also settles. The Lab is being launched as a platform to simulate the synchronisation interface enabling prospective synchronisation operators (Lab Participants), to develop and demonstrate viable propositions across multiple use cases.

The Lab is scheduled to launch in Spring 2026 and will run for approximately six months across four six-week testing and development phases. In each phase, Lab Participants will showcase end-to-end synchronised transaction flows and interact with synchronisation users. Lab findings will inform the design and delivery of a potential future live RT2 synchronisation capability. Participation is by invitation by the BoE and based on an application process. Technical onboarding will begin roughly one month before launch. Demonstrations and a final report summarising key learnings will follow the Lab's conclusion.

The European Securities and Markets Authority (ESMA) has published its second consolidated report on sanctions and measures imposed by national competent authorities in Member States in 2024. The report reveals that over 970 administrative sanctions and measures were issued in financial sectors under ESMA's remit, with the total aggregated value of administrative fines exceeding EUR100 million, an increase compared to 2023. The highest number of administrative sanctions and measures were imposed under the Market Abuse Regulation (MAR), the Markets in Financial Instruments Directive (MiFID) and the Markets in Financial Instruments Regulation (MiFIR).

The highest amounts of administrative fines for 2024 were imposed under MAR. The more granular data shows that over 60% of all administrative sanctions and measures imposed in 2024 were administrative fines, and 10% were issued using settlement procedures. ESMA also reports that no sanctions or measures were imposed under the Securities Financing Transactions Regulation (SFTR) or the Markets in Crypto-Assets Regulation (MiCAR), while a measure was issued for the first time under the European Crowdfunding Service Providers Regulation. ESMA highlights discrepancies in sanctioning powers across jurisdictions, including differences in the amounts of fines, number and types of sanctions and measures, and use of settlements.

The Joint Committee of the European Supervisory Authorities (comprising the European Banking Authority, European Insurance and Occupational Pensions Authority and European Securities and Markets Authority) (ESAs) have published their 2026 work programme, setting out key priorities for cross-sectoral collaboration for 2026.

The programme focuses on joint efforts in relation to:

• Digital Operational Resilience Act (DORA) – the ESAs will concentrate on the effective operation of the new oversight framework and work related to supervisory convergence of DORA. The ESAs will designate third-party providers critical (CTPPs) to the EU financial sector by the end of 2025 and will conduct risk assessments to outline individual annual oversight plans for each CTPP, complemented by a strategic multi-annual oversight plan.
• Consumer protection and financial innovation – in 2026, the ESAs expect to work on drafting regulatory technical standards based on the empowerments in the proposed amendments to the PRIIPs Regulation in the European Commission's (EC's) Retail Investment Strategy. Work on consumer confidence and protection will consider the EC's strategy to develop a Savings and Investment Union.

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The European Securities and Markets Authority (ESMA) has published its final report proposing the replacement of Commission Delegated Regulation (EU) 2016/1437, which sets out the regulatory technical standards (RTS) for the European Electronic Access Point (EEAP). The publication of the European Single Access Point (ESAP) Regulation and of the two Joint Committee implementing technical standards (ITS) on the ESAP make certain aspects of Commission Delegated Regulation (EU) 2016/1437 (the RTS on the EEAP) obsolete. It is therefore necessary to replace the RTS on the EEAP with an RTS whose content is aligned with the ESAP legislation to bring more legal certainty. The proposed RTS align the requirements which are currently in the RTS on the EEAP with the ITS on tasks of ESAP collection bodies and the ITS on ESAP functionalities, and therefore with the establishment of the ESAP project. It does this by cross-referring the relevant sections of the ESAP Regulation or of one of the two ITS. The report also includes a feedback statement following the consultation earlier this year. The draft RTS will now be submitted to the European Commission and are expected to apply from 10 July 2026.

The UK Prudential Regulation Authority (PRA) has published consultation paper LIAC02/25, proposing a series of low-impact amendments to its Rulebook and policy materials.

Key proposals include:

• The conditional disapplication of certain PRA general provisions to implement the deference arrangements under the UK-Swiss Berne Financial Services Agreement.
• A minor technical amendment to the Transitional Measure on Technical Provisions (TMTP) formula to improve consistency in reporting.
• Miscellaneous corrections across the PRA Rulebook to ensure its accuracy.

The deadline for comments is 13 November with implementation for all amendments expected in December. In addition to LIAC02/25, the PRA has published low impact amendments to its rules and policy materials that it has made without further consultation (LIAF02/25).

The European Securities and Markets Authority (ESMA) has published its final report setting out supervisory expectations for the governance arrangements of entities under its direct supervision. These include credit rating agencies, benchmark administrators of EU critical benchmarks and third-country recognised benchmarks, Tier 2 central counterparties, data reporting service providers, securitisation repositories and trade repositories. The report contains feedback from ESMA's July 2024 consultation. Based on the feedback, ESMA has revised its initial proposals to address concerns regarding the prescriptive nature of certain supervisory expectations based on proportionality grounds and the absence of a legal mandate for ESMA to enact regulation in the corporate governance area. As a result, the final framework has been restructured around 12 high-level principles.

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The Bank of England (BoE) has published its approach to supporting responsible innovation across artificial intelligence (AI), distributed ledger technology (DLT) and quantum computing. Recognising these as potentially transformative technologies, the BoE emphasises its role in enabling safe adoption while safeguarding monetary and financial stability. The BoE acknowledges that these technologies will significantly impact the work it does, from setting interest rates, to maintaining financial stability, to operating the UK's core payments infrastructure. It also highlights its responsibility to understand and manage the risks and opportunities these innovations present.

To foster a resilient and innovation-friendly environment, the BoE sets out the following three key regulatory levers.

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The UK Financial Conduct Authority (FCA) has updated its webpage on its consultation on the motor finance consumer redress scheme to include a Frequently Asked Questions (FAQs) section. The FCA's responses reflect queries raised during initial stakeholder engagement and aim to clarify operational and legal aspects of the scheme. Notably, the FCA addresses the role of the UK Financial Ombudsman Service, firms' communication obligations to consumers and to professional representatives, firms' liabilities in relation to 0% APR agreements and the treatment of deceased consumers. The FCA confirms that these FAQs do not represent any new approach to policy. The FCA intends to update these FAQs regularly as its engagement with stakeholders continues.

The European Banking Authority (EBA) has released its 2024 annual report on the convergence of supervisory practices across the EU. The report outlines the EBA's ongoing efforts to strengthen the alignment of supervisory approaches across Member States and across key areas of its activities, including prudential, resolution, digital finance, consumer protection and until the end of this year anti-money laundering/counter-terrorist financing (AML/CFT). In the area of prudential regulation, the report reflects on findings from its 2024 European Supervisory Examination Programme focused on liquidity and funding risk, interest rate risk and hedging, and recovery operationalisation. The report notes that risk levels in these areas remain stable, though challenges persist around data quality, stress testing scenarios and modelling assumptions. The EBA will continue monitoring risks related to online deposit platforms and compliance with Supervisory Outlier Tests in 2025.

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The European Securities and Markets Authority (ESMA) has published its final report on the regulatory and implementing technical standards (RTS and ITS) under the European Green Bonds Regulation (Regulation (EU) 2023/2631). The report follows its April consultation and outlines ESMA's finalised draft technical standards on various aspects of the external reviewer regime, covering criteria for assessing: (i) the appropriateness, adequacy and effectiveness of the systems, resources and procedures; (ii) whether the compliance function has the authority to discharge its responsibilities properly and independently and for assessing the necessary resources, expertise and access to relevant information; (iii) the soundness of administrative and accounting procedures and internal control mechanisms and the effectiveness of control and safeguard arrangements for information processing systems; (iv) whether the information used when providing reviews is of sufficient quality and from reliable sources; (v) information, form and content of applications for recognition; and (vi) standard forms, templates and procedures to notify ESMA of material changes in the information provided at registration.

Following feedback, ESMA has revised the final technical standards to address concerns around proportionality and costs for compliance, as well as providing clarity on compliance and implementation. ESMA has submitted the final draft RTS and ITS to the European Commission for adoption. They will apply exclusively to ESMA-registered external reviewers from 21 June 2026.

The European Securities and Markets Authority (ESMA) has published its final report on three draft regulatory technical standards (RTS) under Regulation (EU) 2024/3005 on the transparency and integrity of environmental, social and governance (ESG) rating activities. ESMA revised the three RTS to take into account comments received from its May consultation. ESMA has also been mindful of the wider initiative for simplification and burden reduction. As a result, the revisions to the finalised RTS are aimed at removing or clarifying elements which could be considered unduly onerous or ambiguous.

Key changes include on the following: 

• RTS on authorisation and recognition – ESMA has removed or simplified several information requirements.
• RTS on separation of business – The requirement for a physical separation of staff remains. However other requirements, such as those relating to network segmentation, have been clarified or removed where they were deemed as imposing excessive burden.
• RTS on disclosures – Several elements have been revised to ensure they are practically achievable by ESG rating providers – Others have been removed when it was judged they did not provide sufficient added value for the burden that was imposed.

ESMA has submitted the finalised draft RTS to the European Commission for adoption. They will also be subject to non-objection by the European Parliament and Council of the EU. They are expected to apply from 2 July 2026.

The Public Offers and Admissions to Trading (Amendment and Consequential and Transitional Provisions) Regulations 2025 have been published, together with an explanatory memorandum. The Regulations make consequential amendments arising out of the commencement of provisions of the Public Offers and Admissions to Trading Regulations 2024 (POATRs), set out transitional provisions in relation to the new regulated activity introduced by the POATRs and make a minor amendment to the UK Financial Conduct Authority's (FCA) investigatory powers provided under the POATRs. The POATRs framework will replace the UK Prospectus Regulation once it takes effect in January 2026.

In particular:

• Regulation 2 substitutes regulation 44 of the POATRs, relating to the power of the FCA to appoint persons to carry out investigations concerning persons who are subject to requirements imposed by, or as a result of, the POATRs.
• Regulation 3 introduces the schedule to the Regulations which contains amendments to various primary legislation (part 1), assimilated direct legislation (part 2) and subordinate legislation (part 3), in connection with the POATRs.

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The UK Prudential Regulation Authority (PRA) and the UK Financial Conduct Authority (FCA) have published joint policy statement PS21/25, setting out the final policy changes to the remuneration rules for dual-regulated firms. The policy statement also provides a summary of feedback to the regulators' November 2024 consultation.

The final rules go beyond the original proposals with key changes including:

• Reducing the bonus deferral period for Senior Management Functions (SMFs) further, so a uniform four-year bonus deferral period will apply to all Material Risk Takers.
• Removing the requirement for a 50/50 split between cash and instruments in both upfront and deferred bonus proportions. Firms may now pay a higher proportion of bonuses in cash up front, provided the deferred portion contains a correspondingly higher proportion of instruments.
• Reducing bonus deferral requirements for many individuals, with the 40% deferral rate applying to the first GBP660,000 and 60% above that threshold.

To support the shift toward a unified framework, the FCA remuneration Handbook rules will be cut by more than 70% as firms will now largely only need to refer to the PRA's remuneration rules.

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The UK Financial Conduct Authority (FCA) has published policy statement PS25/14, accompanied by a press release, setting out final rules to simplify and consolidate the definition of regulatory capital, also known as "own funds", for FCA investment firms under chapter MIFIDPRU 3 of its Handbook. The FCA will delete and replace the existing rules in MIFIDPRU 3 in their entirety. Following feedback to its April consultation, the FCA is removing all cross-references to the UK Capital Requirements Regulation from MIFIDPRU 3 and is establishing a standalone framework for regulatory capital tailored specifically to investment firms. The changes do not alter overall levels of regulatory capital firms must hold or require firms to alter their capital structures, but instead they clarify what qualifies as own funds, reduce unnecessary complexity of requirements and remove banking-specific provisions that are not relevant to investment firms. The new rules, set out in the "Definition Of Capital For Investment Firms Instrument 2025" in the Annex to PS25/14, will apply to all entities subject to MIFIDPRU, including MIFIDPRU investment firms, UK parent entities and parent undertakings subject to the Group Capital Test. For mixed groups containing FCA investment firms and PRA-regulated entities, the rules apply to the FCA investment firm on a solo basis. The new rules will come into force on 1 April 2026.

The European Banking Authority (EBA) and the European Securities and Markets Authority (ESMA) have published their joint final report on technical advice in response to the European Commission's Call for Advice on the Investment Firms Regulation (IFR) and the Investment Firms Directive (IFD). The report, mandated under Article 60 of the IFR and Article 66 of the IFD, proposes limited but targeted revisions to the existing prudential framework which has been deemed fit-for-purpose following feedback to its 2024 June discussion paper. The authorities make a series of 49 recommendations in the report, which aim to: (i) enhance the proportionality and functioning of the prudential framework; and (ii) improve the framework's ability to contribute to a level playing field among investment firms, and between investment firms and financial institutions that perform similar activities.

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The UK Financial Conduct Authority (FCA) has published consultation paper CP25/28, accompanied by a press release, outlining proposals to accelerate the adoption of tokenisation and tokenised funds in the UK. The proposals apply to authorised funds but the FCA's discussion and roadmap sections may be of wider interest to fund and asset managers, including managers of non-authorised funds. The FCA's proposals address fund tokenisation, and do not address unbacked assets such as cryptocurrencies.

The FCA's proposals include:

• Guidance for operating a tokenised fund under the Blueprint model.
• Rules and guidance for an alternative, streamlined dealing model for conventional and tokenised authorised funds, referred to as 'direct to fund' (D2F). D2F has wider application than just to tokenised funds, but the FCA thinks allowing this new dealing model will enable tokenisation.
• A roadmap to advance fund tokenisation and address key barriers.
• A discussion on future tokenisation models that use DLT to provide tokenised portfolio management at retail scale and how regulation may need to change to be fit for the future.

The deadline for responses to the consultation proposals is 21 November, except for the discussion chapter on future tokenisation models, which is 12 December. The FCA expects to publish a policy statement with final rules in the first half of 2026.

Regulation (EU) 2025/2075 amending the Central Securities Depositories Regulation (Regulation (EU) No 909/2014) to shorten the settlement cycle for EU transactions in transferable securities from two business days (T+2) to one business day after the trade date (T+1), has been published in the Official Journal of the European Union (OJ). The proposal was first adopted in February and is intended to: (i) promote settlement efficiency and increase the resilience of EU capital markets; (ii) improve the liquidity of EU capital markets; and (iii) eliminate the costs linked to the misalignment of settlement cycles between EU and other jurisdictions. The Regulation enters into force on 3 November and will apply from 11 October 2027.

The European Banking Authority (EBA) has published a report on white labelling, accompanied by a fact sheet. In the report, the EBA considers the use of white labelling as a business model by the firms that are under its mandate, including credit institutions, e-money institutions, payment institutions, non-bank issuers of asset-referenced tokens and non-bank lenders. The report defines white labelling as a business model in which a financial institution (the provider) enters into an agreement with another entity (the partner, who may or may not be a financial institution) to distribute and offer one or more financial products and services under the partner's own brand only. The EBA finds that white labelling is being widely used, with 35% of surveyed banks employing the model to distribute a broad range of financial products and services, both domestically and cross-border, including account and payment services, credit provisioning and open banking services.

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The Financial Services and Markets Act 2023 (Commencement No.11 and Saving Provisions) Regulations 2025 were made and have been published. These Regulations are the eleventh commencement regulations made under the Financial Services and Markets Act 2023 (FSMA 2023). The Regulations continue the process of revoking certain pieces of retained EU law relating to financial services and restating them into UK domestic law, including through regulator-made rules. You may like to read our article "A boost for UK Financial Services" for further information.

In particular, these Regulations revoke the following:

• The UK MiFID Organisational Regulation (UK Commission Delegated Regulation (EU) 2017/565, otherwise known as the UK MiFID Org Regulation), on 23 October.
• The UK Prospectus Regulation ((EU) 2017/1129), on 19 January 2026.
• The UK PRIIPs Regulation (1286/2014), on 6 April 2026.

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Delegated Regulation (EU) 2025/1311 supplementing the Capital Requirements Regulation (Regulation (EU) No 575/2013) (CRR) has been published in the Official Journal of the European Union (OJ). The Delegated Regulation sets out regulatory technical standards (RTS) specifying the materiality assessment of extensions, and changes to, the use of alternative internal models and changes to the subset of modellable risk factors. The RTS reflect a mandate in Article 325az(8) of the CRR. The Delegated Regulation also sets out detailed documentation requirements and clarifies supervisory expectations for model governance, validation and IT infrastructure changes. It enters into force on 3 November.

Delegated Regulation 2025/1265 supplementing the Capital Requirements Regulation (Regulation (EU) No 575/2013) (CRR) has been published in the Official Journal of the European Union (OJ). The Delegated Regulation, adopted in July, sets out regulatory technical standards (RTS) specifying the method for identifying the main risk driver of a position and for determining whether a transaction represents a long or short position as referred to in Articles 94(3), 273a(3), and 325a(2) of the CRR. The Delegated Regulation enters into force on 3 November.