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We had a fun session of the Financial Services Club this week, in light of the lack of clarity on Brexit from the UK Gov. The discussion was our regular New Year kick-off meeting with special guest David Doyle, sage of all EU regulations affecting Financial Services. David provided us with great insight into the key banking and insurance changes ahead, but I wondered throughout whether we could be bothered.
The reason being that we’re leaving. However, even if the UK exits, it will probably be in our own interests to implement all EU regs in Financial Services. Why? Well, Switzerland does for this very reason: it makes it easy to be a trading partner still. In fact, it wouldn’t surprise me if we do end up retaining passporting but only for as long as we continue to lead the implementation of EU regs. That’s what the UK has tried to do for the past twenty years and, if we continue, we may well maintain our role as the financial hub of Europe. Just a thought.
Anyways, in terms of the regs that we need to watch, here’s my interpretation of David’s speech.
We have entered the six month presidency of the EU under Malta from January 1st 2017. Previous presidencies, with the most recent being the Netherlands and Slovakia, have different priorities and the Maltese priorities are driven by the objective to restore trust in the EU, with a need for a dialogue and reflection on the EU’s future as well as the pertinent issues relating to migration, security and economy. As a result, during the next 6 months, the presidency will focus on six key areas: migration, single market, security, social inclusion, Europe’s neighbourhood and maritime sector.
This translates into some generic things that will impact Financial Services, including:
The Single Market Strategy covering a range of activities including copyright in the digital space, geo-blocking regulation and a review of consumer protection cooperation rules;
General Data Protection Regulation (GDPR) is applicable from 25 May 2018 and likely to have many onerous measures such as a requirement for data protection officers, data protection processors, accountability by design and default, consumer rights to reject and be forgotten and more; and
Money-laundering or terrorism financing updates.
The specific Financial Services Directives and Regulations of import during the next year are:
The Banking Union Directives, including:
Oh, and then there’s Brexit, with the likelihood that Britain will trigger Article 50 before the end of March which will kickstart the lengthy road of EU/UK exit negotiations.
There is then a raft of other stuff that is continuing from previous presidencies through the rest of this year …
All this against a backdrop of continuing low-interest rates, continuing challenges of non-performing loans (especially in Italy and Greece) and the unclear landscape of President Trump’s position on dismantling the Dodd-Frank Regimes, which he implied during the election campaign, especially removing proprietary trading ban and abolishing the CFPB.
David presented for over an hour and said a lot, lot more. There were key insights into Brexit, the Capital Markets Union, the Payment Services Directive and the Markets in Financial Instruments Directive. I would share them here, but you need to be a member of the Financial Services Club to get the full insight … so join!
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