The European Commission has adopted a Delegated Regulation supplementing Regulation 2023/1114 (MiCAR) with regard to regulatory technical standards (RTS) specifying the information in an application for authorisation to offer asset-referenced tokens (ARTs) to the public or to seek their admission to trading. The RTS detail the list of information specified in Article 18(2) of MiCAR, to be provided in an application by legal persons or other undertakings (other than credit institutions) seeking to obtain authorisation. In particular they prescribe information requirements on: (i) the identification of the applicant issuer; (ii) the programme of operations, including the main features of the intended issuance; (iii) the internal governance arrangements and structural organisation, including information on third-party providers of critical and important functions, and internal control framework; (iv) the liquidity management, reserve of assets and redemptions rights, including a description of the stabilisation mechanism for the asset-referenced token for which the authorisation is sought; (v) suitability of the members of the management body; and (vi) the sufficiently good repute of members of the management body, shareholders or members with direct or indirect qualifying holdings. The delegated regulation is now subject to scrutiny by the Council and the European Parliament.  If neither objects within three months, it will be published in the Official Journal of the European Union, entering into force twenty days after.

The Financial Ombudsman Service (FOS) has published a consultation paper seeking views on the interest rates applied to compensation awards. This follows concerns raised in response to a 2024 joint call for input with the UK Financial Conduct Authority, that the current rate of 8% discretionary interest on top of compensation awards is excessively high.

The consultation paper invites feedback on whether the current 8% interest rate should be: (i) maintained at its current level of 8%; (ii) reduced, with respondents to suggest alternative rates and the rationale behind them; (iii) replaced with a tracker rate linked to the Bank of England (BoE) base rate plus 1%, where the base rate is calculated as an average rate over the period that the money was due until the date redress payment is made (FOS's recommended option); or (iv) replaced with a tracker rate linked to the BoE base rate plus 1%, but where the base rate is calculated as the rate at the point of determination of the complaint. FOS also sets out options for implementation, with its preferred approach to apply the new rate to complaints referred from the date the change takes effect.

In addition, FOS is seeking views on the types of exceptional circumstances where it may be appropriate for an ombudsman to ask a firm not to apply interest e.g., by choosing not to award interest for a certain period to reflect a firm's unreasonable conduct that caused delays during the investigation. In such cases, the ombudsman will be required to clearly explain the reasons for departing from the standard rate. The consultation focuses on pre-and-post determination interests, it does not address any other awards an ombudsman may recommend when making a decision. The deadline for comments on the consultation paper is 2 July. FOS aims to publish a policy statement in September, with the intention of implementing any changes as soon as possible thereafter.

The UK Financial Conduct Authority (FCA) has published policy statement PS25/5 accompanied by a press release, outlining final revisions to its Enforcement Guide (now abbreviated as ENFG). The revisions follow a two-part consultation process published in February and November 2024.

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The UK Financial Conduct Authority (FCA) and the Information Commissioner's Office (ICO) have published a discussion of how they are collaborating to support responsible innovation, providing regulatory clarity to give firms the confidence to ensure compliance with data protection and financial regulation.

A survey revealed that 33% of firms view data protection and 20% view FCA regulations as a constraint on AI adoption. A roundtable was held on 9 May to explore and understand these challenges. The FCA and ICO report that what came through was very little about specific regulations standing in the way of innovation. Rather, firms understand the broad rules, but many – especially smaller ones – want clearer examples of 'what good looks like' in practice and more opportunities for engagement to build confidence in trying new technologies.

Actions proposed in response include: (i) development of a statutory code of practice for the development or deployment of AI and automated decision making. They will also help firms to develop, test, and evaluate AI as part of the FCA's AI Lab; (ii) a roundtable with smaller firms later this year to better understand the challenges they face in adopting AI; (iii) working together with other regulators in the Digital Regulation Cooperation Forum (DRCF) to explain expectations around who holds responsibility when AI tools are developed by third parties; and (iv) increasing visibility of existing tools and services. The new DRCF workplan commits regulators to coordinate their approach with exploring how their respective regulatory frameworks apply to AI, including agentic AI, and to identify and address any areas of conflict.

The European Banking Authority (EBA) has published a keynote speech delivered by its Chairperson, José Manuel Campa, at a high-level meeting for European supervisors in Ljubljana, Slovenia, on the importance of an efficient and effective financial services regulatory framework to support sustainable growth while enhancing EU competitiveness. While acknowledging the effectiveness of the current framework, particularly in ensuring financial stability, Mr Campa recognises concerns around its complexity and proportionality, understanding the need for greater simplification efforts.

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The UK Financial Conduct Authority (FCA) has published a press release welcoming a joint statement from asset management trade associations supporting the transition to faster settlement of trades in funds. Effective from 11 October 2027, the settlement period for transactions in listed stocks and bonds in the UK, Switzerland and the EU will change to T+1, meaning trades will settle within one business day. The FCA acknowledges that the operational practicalities of fund settlement will not allow all authorised fund managers to offer T+1 settlement for units in funds. For UK authorised funds and recognised schemes, the FCA supports the recommendation of moving towards a T+2 settlement cycle to align with the consumer duty and better support retail investors in meeting their financial goals. The FCA states that funds currently operating on T+4 cycle should carefully consider how an extended gap between market settlement and fund unit settlement would impact investors. The FCA advises fund managers to begin planning early for the transition and notes that, going forward, any settlement period longer than two business days will require strong justification.

The UK Financial Conduct Authority (FCA) has announced updates to the requirements, directions and limitations applied to firms. This follows a review which identified that certain data was out of date, superseded by new content or contained minor errors. As part of the FCA's strategy to become a smarter and more efficient regulator, it will be taking action to ensure firm-related data is consistent, up-to-date, and necessary, enabling consumers to have access to clearer information and that firms receive improved service. Where changes have been identified as needed, the FCA's next steps will include: (i) automatically implementing immaterial updates that do not alter what a firm can or cannot do; and (ii) contacting firms directly where substantive changes are required, such as the removal of a requirement, direction or limitation. These changes will be taking place over the next few months. No action is required from firms unless the FCA contacts them directly.

The European Securities and Markets Authority (ESMA) has issued written letters to several major social media and platform companies—including X, Meta, TikTok, Alphabet, Telegram, Snap, Amazon, Apple, Google and Reddit—urging them to take proactive steps against the promotion of unauthorised financial services on their platforms. ESMA suggests that this could be achieved by these companies checking ESMA's register of MiFID investment firms. This initiative seeks to combat the rising number of online scams targeting retail investors, which mislead consumers into engaging with unlicensed firms, resulting in financial losses and lack of trust in the wider financial sector and with digital platforms. ESMA's action is aligned with the recent initiative by the International Organization of Securities Commissions on combatting online harm, highlighting the global nature of the issue of financial misconduct in the digital environment. ESMA has also requested for meetings with these platform providers to develop a coordinated approach to retail investor protection from financial harm.

The UK Financial Conduct Authority (FCA) has published consultation paper CP25/14 (CP) on stablecoin issuance and cryptoasset custody, accompanied by an updated webpage. This follows the FCA's discussion paper published in November 2023, which outlines the proposed approach to regulating stablecoins. This new CP is part of the FCA's roadmap for crypto regulation and is intended to be read alongside CP25/15, which sets out the proposed prudential regime for cryptoasset firms (and which we discuss here). In CP25/14, the FCA has proposed rules and guidance for the issuance of qualifying stablecoins and the safeguarding of qualifying cryptoassets, including stablecoins. These activities are expected to become regulated activities under the HM Treasury's draft legislation, the Financial Services and Markets Act 2000 (Regulated Activities and Miscellaneous Provisions) (Cryptoassets) Order 2025 subject to its finalisation.

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The UK Financial Conduct Authority (FCA) has published consultation paper CP25/15 on its proposed prudential regime for cryptoasset firms, also accompanied by an updated webpage. This is intended to be read together with CP25/14 on stablecoin issuance and cryptoasset custody, which we discuss here. In this consultation paper, the FCA has proposed prudential rules and guidance for cryptoasset firms, including those issuing qualifying stablecoins and safeguarding qualifying cryptoassets, including stablecoins. The proposals introduce a new prudential regime to be integrated through two new sourcebooks: (i) COREPRU which will initially apply to firms carrying on regulated cryptoasset activities; and (ii) CRYPTOPRU, which will contain other sector-specific requirements for firms doing regulated cryptoasset activities, with these firms referred to as CRYPTOPRU firms.

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The UK Financial Conduct Authority (FCA) has published two new webpages on the Private Intermittent Securities and Capital Exchange Systems (PISCES) sandbox, a new type of trading platform designed to enable intermittent trading of private company shares. This update follows the FCA's December 2024 consultation on the PISCES framework. The first webpage provides background on the regulatory framework—including who can operate and participate in a PISCES platform—and sets out the FCA's next steps, including plans to publish the final rules in June and run the sandbox to test the framework until June 2030. The second webpage offers guidance for firms seeking to apply to operate a PISCES platform within the sandbox, detailing the application process, eligibility criteria and regulatory expectations for firms. The FCA has opened a pre-application support process to assist prospective applicants ahead of the formal application process from June.

The Economic Governance and EMU Scrutiny Unit has published a study on enhancing EU competitiveness in the banking sector, provided at the request of the European Parliament's Committee on Economic and Monetary Affairs. The study emphasises the importance of a resilient and efficient banking sector for EU competitiveness. Building on its analysis, the study has recommended that, to achieve this, the EU should first prioritise the defragmentation of the banking market, and second, simplify and streamline the prudential framework for banks without compromising resilience.

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A corrigendum to Regulation (EU) 2024/2987, known as EMIR 3, was published in the Official Journal of the European Union. One of the changes EMIR 3 made was to amend the Money Market Funds Regulation (MMF Regulation) by adjusting the rules addressing counterparty risk in financial derivative transactions to take account of whether a transaction is cleared by an EU authorised or recognised CCP. The corrigendum makes a change to those adjusted rules by clarifying that in Article 17 of the MMF Regulation, it is the cash provided, rather than the cash received, by a Money Market Fund (MMF) as part of each reverse repurchase agreement that must not exceed 15% of the assets of the MMF.

The International Organization of Securities Commissions (IOSCO) has published its final report containing revised recommendations for liquidity risk management for collective investment schemes (CIS), accompanied by implementation guidance and a press release. The updated recommendations, which revise IOSCO's 2018 report, are aimed to enhance the resilience of open-ended funds in both normal and stressed market conditions by strengthening liquidity management practices across the product lifecycle. The report has included revised recommendations across six key areas: the CIS design process; liquidity management tools and measures; day-to-day liquidity management practices; stress testing; governance and disclosures to investors and authorities. Key revisions to the recommendations include clarifications on the definitions of common components of open-ended funds structure, the introduction of new liquidity management measures such as "soft closures" and "deferral of redemptions" and enhanced governance and disclosure requirements, among other things. IOSCO states that the implementation guidance should be read alongside the revised recommendations as it provides more detailed guidance and practices for effective implementation. IOSCO expects securities regulators to actively promote the implementation of these recommendations and will review progress by the end of 2026.

The European Banking Authority (EBA) has issued an opinion (dated 12 May) in response to a notification from the Norwegian Ministry of Finance, regarding its intention to recalibrate the risk weight floor for Norwegian retail residential real estate exposures under Article 458 of Regulation (EU) No 575/2013 of the Capital Requirements Regulation. The opinion was published alongside a press release. The measure, initially introduced on 31 December 2020 and extended until 30 June, will result in the risk weight floor increase from 20% to 25% starting from 1 July and remaining in force until 31 December 2026. It applies to all institutions established in Norway that use the Internal Ratings Based approach to calculate capital requirements for relevant exposures, seeking to address systemic risks arising from high household debt and rising real estate prices. The EBA does support the measure but invites the Ministry of Finance to closely monitor and review it to ensure proportionality and avoid overlaps with other regulatory requirements and measures already in place.

The UK Financial Conduct Authority (FCA) has published Handbook Notice 130, which outlines updates to the FCA Handbook, including changes for fund managers stemming from the recommendations of the Investment Research Review and feedback to consultation paper CP24/21. These changes allow fund managers to use a joint payment option to pay for investment research and execution services, subject to a set of guardrails, aligning with rules already applicable to MiFID investment firms.

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The UK Financial Conduct Authority (FCA) has published a consultation paper (CP25/13), with a press release and updated webpage, proposing the improvement of complaints reporting process as part of its five-year strategy to become a smarter regulator. The FCA's aim is to make data collection processes more simple, effective and consistent, as well as improving the quality of data that is collected and reducing regulatory burden.

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The European Banking Authority (EBA) has published an onboarding plan, together with a press release, for large and other institutions to access and submit information to the new Pillar 3 Data Hub (P3DH)—a centralised platform for public disclosures under the revised Capital Requirements Regulation (CRR3). The onboarding plan includes procedural steps for institutions to follow when submitting Pillar 3 information and outlines a phased-in timeline for the process. The initiative will enable users to explore and visualise disclosures across institutions and over time, making it easier for institutions to benchmark themselves against peers and enhancing market discipline. The P3DH information will be available to the public from December. The EBA has also published a list of FAQs.

The UK Prudential Regulation Authority (PRA) has published a consultation paper (CP12/25) setting out Phase 1 of its Pillar 2A review. This first phase review seeks to address the consequential impact of the near-final PRA rules that would implement the Basel 3.1 standards, as well as proposals to improve information, guidance and transparency for firms and options to reduce the reporting burden in the interests of proportionality.

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The European Banking Authority (EBA) has published a consultation paper (CP) proposing amendments to Commission Implementing Regulation (EU) 2024/3172 on the EBA Pillar 3 disclosure framework, aligning it with the requirements of revised Capital Requirements Regulation (CRR3) on ESG-related risks, equity exposures and aggregate exposure to shadow banking entities. The CP also seeks to finalise the implementation of prudential disclosure requirements included in the EU banking package published in 2024. Through the amendments, the EBA aims to improve the transparency and consistency of disclosures while also simplifying the reporting process for institutions. The EBA also intends to provide an updated mapping tool to help institutions align Pillar 3 disclosures with supervisory reporting requirements. The deadline for comments to the consultation paper is 22 August. The final ITS are expected to be submitted to the European Commission by Q4 2025.

Commission Delegated Regulation (EU) 2025/1003 has been published in the Official Journal of the European Union (OJ), supplementing the EU Markets in Financial Instruments Regulation (MiFIR) as regards over-the-counter derivatives (OTC) identifying reference data for the purposes of MiFIR transparency requirements. The delegated regulation sets out the identifying reference data for OTC interest rate swaps and OTC credit default swaps, to meet transparency requirements under article 8a(2), 10 and 21 of MiFIR. The data will enable market participants and authorities to identify and distinguish these derivatives by asset class, instrument type, notional currency, among other relevant characteristics. The regulation will enter into force on 11 June 2025 and will apply from 1 September 2026.

The Basel Committee on Banking Supervision (BCBS) had met to discuss a range of initiatives, following the GHOS meeting which took place earlier this month. The discussions focused on:

• Recent market developments and the financial stability outlook for the global banking system.
• Progress on efforts to strengthen supervisory effectiveness following the 2023 banking turmoil. An update on the outcome of this work will be published by the end of the year.
• Comments received to the BCBS consultation on third-part risk management in the banking sector. The BCBS has aimed to finalise principles for third-party risk management by the end of 2025.
• The use of technological innovation to make Pillar 3 disclosures more accessible in machine-readable formats. The BCBS plans to consult on this proposal by the end of the year.
• Prioritising the analysis of financial risks from extreme weather events. The BCBS is also mandated to publish the voluntary climate-related financial risk disclosure framework, which will be released in June.

The European Commission (EC) has published a call for advice to the European Banking Authority (EBA) together with a letter from John Berrigan, Directorate-General of Financial Stability, Financial Services and Capital Markets Union (DG FISMA). The EC has asked the EBA to conduct a second benchmarking exercise on national loan enforcement frameworks from a bank creditor perspective, following the initial exercise conducted in 2019–2020. The benchmarking will assess the efficiency of enforcement procedures in terms of recovery rates, time to recovery and judicial costs. The EBA is expected to deliver a preliminary analysis by July, with the final report due by 31 October.

The UK Payments Systems Regulator (PSR) has published a consolidated policy statement (PS25/5) concerning the authorised push payment (APP) fraud reimbursement requirement within the Faster Payments system, which came into effect on 7 October 2024. The document brings together previous publications on the reimbursement requirement to serve as a single point reference for stakeholders seeking to understand the policy and how it may impact them. The statement acts as general guidance to aid interpretation of the policy. The policy statement has also included FAQS on aspects of the APP scam reimbursement policy and, except where otherwise indicated, also applies to the requirements for reimbursement of APP fraud committed over the CHAPS payment system.

The European Securities and Markets Authority (ESMA) has launched a call for evidence (CfE), accompanied by a press release, to gather input on the retail investor journey in capital markets under the revised EU Markets in Financial Instruments Directive (MiFID II). The CfE aims to assess whether regulatory or non-regulatory barriers may discourage retail investor participation in capital markets. The CfE considers:

• Retail market trends, including the growing appeal of speculative products among younger investors and the rising influence of social media on investment decisions.
• Specific regulatory requirements under MiFID II, such as regulatory disclosures and assessment of suitability and appropriateness, which can impact retail investors.
• Additional areas such as the investor experience under the European crowdfunding framework and broader reflections on how to achieve the right balance between investor protection and enabling informed risk-taking.

ESMA has also published a summary of the CfE to facilitate responses by consumers and related organisations. The deadline for comments to the CfE is 21 July. ESMA will use the responses to assess, in Q3 2025, whether specific clarifications or regulatory adjustments are needed.

The European Commission has published its Omnibus IV legislative proposal, together with a press release, for a Directive amending the Markets in Financial Instruments Directive II (MiFID II) and the Critical Entities Resilience Directive to simplify various administrative requirements for small mid-cap enterprises (SMCs), in line with the mitigating measures already available for SMEs. SMEs are currently defined as companies with under 250 employees and an annual turnover of up to EUR50 million or a balance sheet total up to EUR43m, while SMCs are those that have outgrown the SME definition. The proposed amendments will simplify regulatory requirements and reduce administrative burdens for SMCs, in the interests of helping them to scale up.

The legislative proposal represents the fourth Omnibus simplification package, following Omnibus I and II on the simplification of sustainability reporting and due diligence rules, and Omnibus III on the simplification of the Common Agricultural Policy. The Omnibus IV proposals include: (i) the introduction of a new category of SMCs to capture enterprises that are up to three times the size of SMEs; (ii) simplified compliance obligations for SMCs, permitting them to provide product information in digital format; (iii) common specifications for companies to demonstrate compliance with EU rules in the absence of harmonised standards; and (iv) a simplification of record-keeping requirements in the General Data Protection Regulation.

The International Organization of Securities Commissions (IOSCO) has issued a statement calling for platform providers to take stronger action against rising investment fraud, driven by increased retail investor activity on digital platforms. It encourages platform providers to leverage the IOSCO International Securities and Commodities Alerts Network (I-SCAN)—a database launched in March that identifies unlicensed firms or those engaging in illegal activities—to block, warn against or remove illegal investment offerings from their platforms. In the statement, IOSCO has also highlighted effective measures used in some jurisdictions to combat online harm involving financial misconduct, including due diligence on unauthorised offerings, rigorous enforcement of compliance with terms of service, strong processes for detecting scams and proactive engagement with financial regulators and government authorities, including referrals of fraudulent activity.

The International Organization of Securities Commissions (IOSCO) has published its sustainable bonds report with a press release, identifying key characteristics and growth trends for the sustainable bond market, which had surpassed USD 5.7 trillion in cumulative issuances in 2024.The report examines the characteristics of sustainable bonds, which include green, social, sustainability-linked and transition bonds. It also sets out five key considerations to assist regulators with addressing market challenges, including enhancing investor protection, ensuring fair and efficient sustainable bond markets and improving accessibility.

These are:

• To ensure greater clarity in existing or new regulatory frameworks to demonstrate alignment with internationally accepted principles and standards, support consistency, build investor confidence and support market participation.
• To establish guiding principles to help provide clarity and consistency when categorising sustainable bond types.
• To enhance transparency and disclosure requirements when it comes to reporting on issuers' progress toward sustainability-related goals or sustainability performance targets to promote public accountability.
• To promote the use of independent and credible external reviewers to mitigate conflicts of interest.
• To utilise capacity building and educational programs to increase awareness and understanding of sustainable bonds among issuers, investors, intermediaries and regulator.

The UK Prudential Regulation Authority (PRA) has published a final policy statement (PS6/25) alongside a press release, finalising the updates to Supervisory Statement 5/21 (SS 5/21) and branch reporting requirements for international firms operating in the UK. In response to feedback on its July 2024 consultation, the PRA has made several adjustments to the draft policy.

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European Parliament's Committee on Economic and Monetary Affairs has adopted a proposal to amend the Central Securities Depositories Regulation (CSDR), introducing a shorter settlement cycle for transferable securities transactions within the EU, with related press release. The CSDR amendment will reduce the settlement period under CSDR from two business days after trading takes place (T+2) to one business day (T+1), with the aim of promoting settlement efficiency, improving the liquidity of capital markets and eliminating costs linked to the misalignment of settlement cycles between the EU and other jurisdictions.

The ECON proposal has included a requirement for the European Securities and Markets Authority (ESMA) to publish a report on settlement efficiency during the move to T+1 and on the feasibility of further shortening the settlement cycle to T+0. The final text will be subject to negotiations with the European Council which has already adopted its position. The new regulation will apply from 11 October 2027.

Martin Moloney, Deputy Secretary General of the Financial Stability Board (FSB), has delivered a speech at the International Council of Securities Associations' Annual General Meeting on the potential for reforming financial regulation in a way that supports, rather than stifles, economic growth. Mr Moloney placed particular emphasis on pursing sustainable economic growth, supported by stable financial markets, for effective regulatory reform and warned against cycles of deregulation and re-regulation. He urged policymakers to critically assess and streamline existing regulatory regimes, noting that both legislative and rule-making processes often fall short in designing optimal regulatory frameworks.

Mr Moloney outlined three key challenges with effective regulatory redesign:

• Complexity of objectives. Regulatory tools must now serve multiple goals, which can make it difficult to calibrate them proportionately.
• Industry consultation. While essential, industry feedback tends to gravitate toward consensus on the 'lowest common denominator', not necessarily reflecting the changes that industry would most benefit from.
• Global interdependence. Regulatory reform is constrained by the need for international consistency as jurisdictions cannot diverge significantly from global norms when creating national-based legislation without facing cross-border consequences.

The European Banking Authority (EBA) has published part 1 of its 2024 annual report, with a press release, reflecting on key regulatory and supervisory achievements under its work programme over the past year. These include: (i) progress in the implementation of the Basel III reforms; (ii) the further integration of ESG considerations into regulatory frameworks, via the issuance of guidelines and reports on ESG risks, greenwashing and scenario analysis; (iii) the assessment of financial stability amid high interest rates and geopolitical uncertainties, supported by two risk assessment reports; (iv) the enhancement of regulatory data infrastructure through the EUCLID platform; (v) the development of oversight and supervisory capacity for firms subject to the EU Digital Operational Resilience Act (DORA) and the EU Markets in Crypto-Assets Regulation (MiCAR); and (vi) an enhanced focus on innovation and consumers (including access to financial services) while preparing for the transition to the new anti-money laundering and counter-terrorist financing (AML/CFT) framework.

HM Treasury (HMT) has published a response to its 2024 consultation on regulating Buy-Now, Pay-Later (BNPL) products and laid the draft secondary legislation (Financial Services and Markets Act 2000 (Regulated Activities etc) (Amendment) Order 2025), to implement the proposed regime before Parliament. The consultation response is accompanied by an updated webpage and press release. The proposed regulatory framework aims to bring BNPL products under the UK Financial Conduct Authority's (FCA) oversight, ensuring consumers receive clear information, undergo affordability checks, have access to the Financial Ombudsman Service and benefit from the protections of section 75 of the Consumer Credit Act (CCA)—which imposes liability upon a creditor for breaches by a supplier—should something go wrong with their purchases.

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Regulation (EU) 2025/914 amending the EU Benchmarks Regulation has been published in the Official Journal of the EU. The amending Regulation amends the scope of the rules for benchmarks, the use of benchmarks provided by a third-country administrator and certain reporting requirements. Further information can be found in our Financial Regulatory Developments update, EU provisional agreement on regulation amending the Benchmarks Regulation. The regulation will enter into force on 8 June and will apply from 1 January 2026.

The International Organization of Securities Commissions (IOSCO) has published final reports on finfluencers, online imitative trading practices and digital engagement practices, accompanied by a press release. These reports are part of IOSCO's Roadmap for Retail Investor Online Safety to enhance retail investor protection from fraud, excessive risk taking and misinformation, in the digital age.

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HM Treasury (HMT) has published Phase 1 of its two-part consultation on reforming the Consumer Credit Act 1974 (CCA), accompanied by an updated webpage. The proposals aim to modernise the CCA to better align with new financial products and technology while promoting a competitive consumer credit market which supports the growth of the UK economy. The new regime will repeal many of the CCA provisions, to be replaced with rules in the UK Financial Conduct Authority (FCA) Handbook as part of a more flexible, outcomes-based approach. Further details can be found in our client bulletin, Goodbye old friend? HM Treasury consultation on Consumer Credit Act 1974 reform.

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The European Banking Authority (EBA) has repealed its guidelines on the specification of types of exposures to be associated with high risk. The decision follows the application of the revised Capital Requirements Regulation (CRR 3) which no longer includes the high-risk exposure class and now only refers to subordinated debt exposures. As a result, the guidelines are no longer applicable.

The UK Payment Systems Regulator (PSR) has published an update on what it has seen since the implementation of its authorised push payment (APP) fraud reimbursement scheme in October 2024. The data covers UK payments made via the Faster Payments system from the start of the reimbursement policy (7 October 2024) to the end of 2024.

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The European Central Bank (ECB) has announced that the amendment to the TARGET Guideline, which would allow non-bank payment service providers (non-bank PSPs) to participate in TARGET is postponed. This has resulted from delays in some euro area countries in transposing the required amendments to the Settlement Finality Directive and revised Payment Services Directive (PSD2) into their national legislation. The amendment, outlined in Decision ECB/2025/2, is now expected to enter into force in October.

A corrigendum to Commission Delegated Regulation (EU) 2024/1774, which supplements the Regulation on digital operational resilience for the financial sector (DORA), was published in the Official Journal of the European Union (OJ). Commission Delegated Regulation (EU) 2024/1774 contains regulatory technical standards (RTS) specifying ICT risk management tools, methods, processes and policies and the simplified ICT risk management framework. It reflects mandates under Articles 15 and 16(3) of DORA. The corrigendum replaces a reference to Article 15 of Commission Delegated Regulation (EU) 2024/1772 in Article 22 of the Delegated Regulation (ICT-related incident management policy) with a reference to Article 8(2) of that Delegated Regulation.

The UK Bank Resolution (Recapitalisation) Act 2025 has received royal assent and was published. The Act makes provision for recapitalisation costs in relation to the special resolution regime under the Banking Act 2009, in particular in so far as the regime is applied to smaller banks which do not hold MREL (a minimum requirement for own funds and eligible liabilities). It: (i) expands the statutory functions of the Financial Services Compensation Scheme (FSCS), requiring it to provide funds to the Bank of England upon request which could be used to meet certain costs arising from the use of the resolution regime to manage the failure of a bank, building society or Prudential Regulation Authority (PRA) authorised investment firm; (ii) allows for the FSCS to use its levy-raising powers to recover any funds provided to the Bank of England after a failure event through imposing levies on the banking sector; (iii) extends the Bank of England's ability, through explicit provision, to require the issuance of shares in connection with a resolution, to facilitate the Bank's use of the funds provided by the FSCS to meet a failing bank's recapitalisation costs; and (iv) makes a number of minor and consequential amendments to legislation to support the measures outlined above and ensure FSCS funds can be used effectively in a resolution. The provisions of the Act are expressed to come into force on such day as HM Treasury may appoint by statutory instrument.

The UK Property (Digital Assets etc) Bill has completed its third reading in the House of Lords with no further amendments and passed to the House of Commons for consideration. The Bill will give effect to recommendations of the Law Commission to confirm in statute that a thing that is digital or electronic in nature is not prevented from being personal property. The Bill had its first reading in the House of Commons on 12 May and it has now been referred to a Second Reading Committee.

The Cross Market Operational Resilience Group's (CMORG) AI Taskforce has released its AI Baseline Guidance Review (dated January 2025), accompanied by a press release. The CMORG AI Taskforce conducted a baseline review of existing guidance on the mitigation of generative-AI (Gen-AI) risks and developed materials on good practice in the financial sector.

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The UK Financial Services and Markets Act 2023 (Private Intermittent Securities and Capital Exchange System Sandbox) Regulations 2025 were published, alongside an explanatory memorandum. The Regulations largely reflect the draft Regulations published in November 2024. The Regulations establish the Private Intermittent Securities and Capital Exchange System (PISCES) Sandbox, a new innovative market for trading private company shares, using the Financial Market Infrastructure powers in the Financial Services and Markets Act 2023. The Regulations set the framework for potential PISCES operators to apply to the Financial Conduct Authority (FCA), to operate intermittent trading events for participating private companies and investors.

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The European Parliament's Committee on Economic and Monetary Affairs (ECON) has released a draft report (dated 14 May) and motion for a European Parliament resolution on the impact of artificial intelligence (AI) on the financial sector. The report highlights the broad adoption of AI and its benefits across the EU financial services sector, including in fraud detection, anti-money laundering and personalised financial advice, among other areas. While acknowledging risks with AI-usage related to data quality and cybersecurity, ECON is of the view that these are already addressed through multiple pieces of sectoral legislation at both national and EU level, including the EU AI Act. With concerns of regulatory overlaps and legal uncertainties—which can limit the use of AI and complicate compliance for financial institutions— ECON advocates for responsible use of AI instead of new restrictive legislation. The motion for a resolution calls on the European Commission to: (i) provide clear guidance on how existing financial regulations apply to AI, ensuring consistent definitions and a simplified regulatory framework to avoid duplicative requirements; (ii) refrain from introducing new sector-specific AI regulation that can add complexity and uncertainty to already established sectoral rules, potentially creating barriers in cross-border markets; and (iii) support industry measures to enhance the understanding and responsible use of AI and provide clearer guidance with regard to the EU AI Act's requirements for financial institutions to comply with AI literacy requirements.

The European Parliament's Committee on Economic and Monetary Affairs (ECON) has published a draft report (dated 13 May) and motion for a European Parliament resolution on improving access to finance for SMEs and scale-ups. The motion for a resolution has regard to various recent European Commission (EC) communications, including on the Savings and Investment Union (SIU) and competitiveness compass, and other key publications and reports such as the Draghi report and Letta report.

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The European Banking Authority (EBA) has published an updated report, together with a press release, on the monitoring of the liquidity coverage ratio (LCR) and the net stable funding ratio (NSFR) in the European Union. This report provides updated guidance following the March 2023 banking turmoil, which highlighted the need for enhanced supervision of liquidity aspects resulting from changes in interest rates and related trends in deposit behaviour and concentrations.

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The Ninth Commencement Regulations–the Financial Services and Markets Act 2023 (Commencement No. 9) Regulations 2025–under the Financial Services and Markets Act 2023 (FSMA 2023) were made and have been published. The Ninth Commencement Regulations continue the process provided for in FSMA 2023 of revoking laws relating to financial services which were derived from EU law and replacing them, for the most part, with regulators rules. For more information see our briefing on FSMA 2023. In particular, these regulations make the following changes, among others:

• Revoke UK Commission Delegated Regulation (EU) 2017/58, which contains regulatory technical standards (RTS) supplementing the UK Markets in Financial Instruments Regulation (600/2014) (UK MiFIR) relating to transparency requirements for trading venues and investment firms in respect of bonds, structured finance products, emission allowances and derivatives.
• Revoke the Capital Requirements (Capital Buffers and Macro-prudential Measures) Regulations 2014 (SI 2014/894) (Capital Buffers Regulations). In September 2024, HM Treasury published a draft version of a statutory instrument restating the Capital Buffers Regulations.

The revocations came into force on 14 May, except in respect of the Capital Buffers Regulations, which will be revoked on 31 July.

The Group of Central Bank Governors and Heads of Supervision (GHOS), the oversight body of the Basel Committee on Banking Supervision (BIS), met to discuss the implementation of Basel III and its work on climate-related financial risks. The GHOS members unanimously reaffirmed their expectation to implement Basel III in full and consistently and as soon as possible, noting that approximately 70% of member jurisdictions have now implemented, or will shortly implement, the standards. The GHOS tasked the Committee with continuing to monitor and assess the full and consistent implementation of Basel III. GHOS members also discussed the Committee's proposed Pillar 3 disclosure framework for climate-related financial risks. The Basel Committee will publish a voluntary disclosure framework for jurisdictions to consider. In addition, the GHOS discussed the Committee's broader work on climate-related financial risks and tasked the Committee with prioritising its work to analyse the impact of extreme weather events on financial risks.

The UK Financial Conduct Authority (FCA) has published a final policy statement (PS25/4), together with an updated webpage and press release, on final rules extending the new payment optionality for investment research to pooled investment funds. The rules were consulted on previously and will allow fund managers to pay for investment research using a joint payment option for research and execution services, subject to a set of guardrails. The feedback was largely positive, although respondents recommended more flexibility around guardrails. In response, the FCA has amended its proposed guardrails on written policies, research budgets, cost allocation and disclosure.

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