Highlights of my week: Summer holidays from today … back on 9th September! I wish all my readers Happy Holidays – wherever you are allowed to go! To close the summer season, the European Commission extended the Green Deal by announcing the “Fit for 55” package of proposals designed to maintain the EU’s global leadership role. Actual disbursements from the RRF have now been approved. The ECB is going to develop work on the digital Euro but is still keeping its options open on an actual launch. More questioning if the EU is really doing enough on money laundering. Reviews of MiFID, MiFIR and Solvency II continue (How will the EU’s SII review compare with UK post-Brexit changes?). The work on the stability implications of “third-country” CCPs continues apace so I will have more to say in my `Brexit and the City’ videos in due course – the latest one on the ending of the City’s Golden Age has now had 12k views just this week. So the topic is interesting to someone!
Graham Bishop
(This e-mail provides the headers of a selection of the articles published this week. If you would like to upgrade to our Gold service and access all articles - with live links to the underlying news - please click on the button)
Articles from 9 - 15 July 2020
General Financial Policy
Remarks by Commissioner Gentiloni at the Eurogroup press conference : It was a very important moment because it symbolised a new period in the transatlantic relationship. In terms of our relations with the US, we have gone from a winter of discontent to a summer of cooperation.
ECOFIN Council gives green light to first recovery disbursements : EU economic and finance ministers today adopted the first batch of Council implementing decisions on the approval of national recovery and resilience plans. Austria, Belgium, Denmark, France, Germany, Greece, Italy, Latvia, Luxembourg, Portugal, Slovakia and Spain got the green light for the use of EU recovery and resilience funds to boost their economies and recover from the COVID-19 fallout.
Banking Union
Accountancy Europe: Money laundering is a real issue: are we doing enough to fight it? : Drug dealers reinvesting their criminal activity’s revenues into a legal business. Tax evaders partially hiding their income. Corrupted civil servants accepting bribery. These are just some of the unlawful activities that generate money laundering (ML).
Capital Markets Union
ESMA publishes methodology for assessing third country CCPs systemic importance : The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today published a methodology for assessing whether a third country central counterparty (TC-CCP) or some of its clearing services are of such substantial systemic importance that the TC-CCP should not be recognised to provide certain clearing services or activities in the European Union.
The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today launched seven public consultations : The European Securities and Markets Authority (ESMA), the EU’s securities markets regulator, today launched seven public consultations to gather stakeholder feedback on how to implement its central counterparty (CCP) recovery mandates.
AFME welcomes ESMA consultation on MiFIR transparency requirements : We appreciate ESMA’s clarity in stating that its data does not currently reflect the existing market structure. Ahead of the MiFIR review, it is vital to base analysis upon data that provides a clear picture of the EU trading landscape.
MIFID 2 Review – Market Structure: EBF priorities : The EBF is a true supporter of the EC Capital Markets Union Action Plan and the ambition to further integrate capital markets in the EU. We therefore welcome a review of MiFID II/MiFIR that is aimed at facilitating issuers’ and end-clients’ use of EU capital markets for the purposes of their financing and risk management.
ESMA consults on the review of transparency requirements under MiFIR : The Consultation Paper focuses on technical issues and addresses topics that do not require a prior change of MiFID II/MiFIR.
EIOPA: Consultation on the revision of the Solvency II Guidelines on Contract Boundaries and Valuation of Technical Provisions : As part of the 2020 review of Solvency II, EIOPA identified several divergent practices regarding the implementation and supervision of calculation of technical provisions.
The International Capital Market Association's Assessment of Market Practice and Regulatory Policy : The Quarterly Assessment is on the orderly wind-down of LIBOR in the bond market. View Article
Environmental, Social, Governance (ESG)
Statement by President von der Leyen on delivering the European Green Deal : Reflecting the whole-of-government approach or the whole-of-society, the whole-of-economy approach.This was the message almost exactly two years ago to the day – it was 16 July – when I put on the table my Political Guidelines, and in there the core part was the European Green Deal.
Bruegel: Fit for 55 marks Europe’s climate moment of truth : With Fit for 55, Europe is the global first mover in turning a long-term net-zero goal into real-world policies, marking the entry of climate policy into the daily life of all citizens and businesses.
CEPS: Fit for 55 – is the European Green Deal really leaving no-one behind? : This week the European Commission will publish ‘Fit for 55’ – the package intended to set the EU on the path to a greenhouse gas (GHG) emissions reduction of 55% by 2030 and, ultimately, climate neutrality by 2050. The package will contain more than a dozen legislative proposals, both for new and existing laws.
TCFD: Statement of Michael R. Bloomberg on the G20’s Support of TCFD Framework : The G20’s announcement supporting global implementation of the TCFD framework recognizes the importance of a coordinated approach to climate risk disclosure and adds new momentum to the effort to address the economic risks of climate change. View
Accountancy Europe: New Roadmap enhances EU Sustainable Finance Strategy : Accountancy Europe welcomes the European Commission’s (EC) renewed strategy for financing the transition to a sustainable economy.
European Commission: Draft proposal for a social taxonomy : The draft report will argue that in the face of a pandemic, unanswered social questions around a sustainable transition, continuing human rights abuses and continuously rising costs for housing, the time is right to identify economic activities that contribute to advancing social objectives
European Commission: Public Consultation Report on Taxonomy extension options linked to environmental objectives : This draft proposal will be focussed on support for the environmental transition needed in the whole economy – it proposes further clarity on both: activities that are significantly harmful to environmental sustainability, and those that have no significant impact on it.
GRI welcomes role as ‘co-constructor’ of new EU sustainability reporting standards : Statement of Cooperation signed by GRI and EFRAG. The announcement of a Statement of Cooperation between GRI and EFRAG Project task Force sees both organizations agree to share technical expertise to co-construct new EU sustainability reporting standards and contribute to further global convergence.
Fin Tech Regulation
ECB: Preparing for the euro’s digital future: Blog post by Fabio Panetta, Member of the Executive Board of the ECB...We are entering the age of digital money. Much like commodity or representative money in the past, digital money is emerging in response to changes in society and technology.
EBF committed to actively participating in digital euro investigation : The project seeks to clarify the demand, design and interaction of an electronic form of money issued by the Eurosystem with the payments and banking system.
Economic Policies Impacting EU Finance
Eurogroup: Meeting with US Treasury Secretary Yellen and more : Economic and financial policies, Banking union, Euro area fiscal stance, The euro as a digital currency: stock-taking
Brexit and the City
Federal Trust - Graham Bishop: Brexit has ended the Golden Age of the City of London : The Chancellor's Mansion House speech acknowledges the importance of financial services for the British economy. But it gives little hope that the British government will be able to prevent the decline of the sector as a consequence of Brexit. View Article
FCA commits to being a more innovative, assertive and adaptive regulator : The FCA today makes a commitment to be a more, innovative, adaptive and assertive regulator. The commitment reflects the FCA’s Business Plan for 2021/22, the first annual plan since Nikhil Rathi joined the FCA as Chief Executive in October 2020.