BBA Announces Changes to LIBOR
On June 12, the British Bankers' Association (BBA) published a press release announcing changes to the London Interbank Offered Rate (LIBOR). The reforms follow the publication of the Wheatley Review in September 2012, and include:
From July 1, the publication of BBA LIBOR individual panel banks' daily submissions for USD, EUR, GBP, CHF and JPY will be embargoed for three months. The daily calculation and publication of BBA LIBOR fixing rates will continue unaffected. The rates for a whole month at a time will be published at the beginning of the fourth month; the first delayed release of individual bank submissions will be provided on the first business day of November 2013.
The publication of "same day" EURO LIBOR rates for one week and one month will cease from July 31. These two rates were supplemental to the "spot" EUR LIBOR rates for all seven LIBOR tenors, which will continue as usual. Press Release.
Draft Alternative Investment Fund Manages Regulations 2013 Published
On June 12, the Draft Investment Fund Managers Regulations 2013, together with an explanatory memorandum, were published. The Regulations come into force on July 22.
The Regulations implement the majority of the Alternative Investment Fund Managers Directive (2011/61/EU) (AIFMD). The AIFMD aims to introduce a harmonised regulatory framework across the EU for EU-established managers (AIFMs) of alternative investment funds (AIFs).
The Regulations implement the AIFMD by amending the Financial Services and Markets Act 2000 (FSMA) and other relevant legislation (in the schedules to the Regulations) so that managing an AIF, which is required to be authorised under the AIFMD, is regulated under the FSMA. Stand-alone provisions in the main body of the Regulations (and further amendments in the schedules) also apply requirements of the AIFMD both to persons regulated under that regime and to other persons who are not required to be authorised under the AIFMD but whom the AIFMD imposes requirements on.
The UK Government will review the Regulations and publish a report setting out the conclusions of the review by July 22. Draft Investment Fund Managers Regulations 2013. Explanatory Memorandum.
ESMA Finalises Guidelines on Remuneration Policies and Practices Under MiFID
On June 11, the European Securities and Markets Authority (ESMA) published a final report on the guidelines on remuneration policies and practices under the Markets in Financial Instruments Directive (2004/39/EC) (MiFID) (ESMA/2013/606). Remuneration policies should be aligned with effective conflicts of interest management duties and conduct of business risk management obligations, in order to ensure that clients' interests are not impaired by the remuneration policies and practices adopted by the firm in the short, medium and long term.
The final report also contains feedback received from ESMA's September 2012 consultation on the draft guidelines and sets out material changes to the guidelines made by ESMA following consultation. Competent authorities to which these guidelines apply must notify ESMA whether they comply or intend to comply with the guidelines, stating their reasons for non-compliance where they do not comply or do not intend to comply, within two months of the date of publication of the translated versions by ESMA. Final Report.