Herbert Smith Freehills assists with first prevention of corruption clause in Olympic Games host city contract

Sylvia Schenk, a consultant in our Frankfurt disputes team, has worked with global anti-corruption NGO Transparency International to secure the first prevention of corruption clause in an Olympic Games host city’s contract. The International Olympic Committee (IOC) announced on 31 July that the 2028 games would go to Los Angeles. Although the contract must be ratified by the full IOC membership in September, the IOC has, for the first time, included an anti-corruption clause in the contract accepted by the city. The document includes mandates for nondiscrimination, protection of human rights and prevention of fraud or corruption “including by establishing and maintaining effective reporting and compliance.”

Sylvia advises clients on compliance, sports law, sustainability and human rights. She began seriously working against human rights abuses and corruption in global sports in 2006 after a career as a track athlete, including competing in the 1972 Olympic Games in Munich. For further details, see the article in Corporate Counsel.

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Filed under Announcements, Bribery and Corruption, Herbert Smith Freehills

NEW SANCTIONS REPORTING REQUIREMENTS FOR NON-FINANCIAL SECTOR BUSINESSES

With effect from 8 August, the Government has introduced significant new reporting requirements in relation to EU asset freeze regimes. Previously, only businesses in the financial sector were subject to the obligations, found in UK financial sanctions instruments, to report specified information to the Office of Financial Sanctions Implementation (“OFSI“) in Her Majesty’s Treasury (“HMT“). From 8 August, further sectors, including auditors, external accountants, tax advisers and lawyers, have been brought within the scope of these obligations and may commit a criminal offence if they fail to comply with the relevant reporting requirements.

The European Union Financial Sanctions (Amendment of Information Provisions) Regulations 2017 (the “Regulation“) implements this change, and applies in respect of information received on or after 8 August. Continue reading

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Filed under Corporate Crime, Sanctions and Money Laundering, UK

UK GOVERNMENT PUBLISHES RESPONSE ON THE LEGAL FRAMEWORK FOR SANCTIONS POST-BREXIT

On 2 August 2017, the UK Government published its response to the public consultation on the UK’s future legal framework for imposing and implementing sanctions after the UK’s exit from the European Union (see our previous blog post).

The response sets out detailed answers to questions raised during the consultation, outlining the proposed powers for the imposition of financial and trade restrictions and the designation of individuals, as well as the proposed procedures under which such powers will be exercised. The Queen’s Speech on 21 June 2017 confirmed the Government’s intention to introduce a Sanctions Bill during the current Parliamentary session (2017-2019), with further guidance promised on certain issues in due course.

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Filed under Europe, Sanctions and Money Laundering, UK

Asset managers and their senior management (including MICs) warned of action for regulatory non-compliance in Hong Kong

Boards and senior management (including Managers-in-Charge of Core Functions (MICs)) of asset managers have been called on by the Hong Kong Securities and Futures Commission (SFC) (31 July 2017 circular) and the Hong Kong Monetary Authority (2 August 2017 circular) to ensure they maintain adequate management oversight of their firm’s business activities and to ensure maintenance of appropriate standards of conduct and proper risk management measures, after the SFC identified a number of potential regulatory concerns.

The SFC has said that it will continue to closely monitor asset managers and will not hesitate to take action against any licensed corporations and their senior management for failure to comply with regulatory requirements.

Our recent e-bulletin highlights the SFC’s concerns. If you have any questions or would like to know how this might affect your business, please feel free to contact William Hallatt, Hannah Cassidy, Natalie Curtis, or your usual Herbert Smith Freehills contact.

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Filed under Hong Kong, Regulatory Reform

US PRESIDENT SIGNS IRAN, NORTH KOREA AND RUSSIA SANCTIONS BILL – WITH TWO SIGNING STATEMENTS

H.R. 3364 (the “Countering America’s Adversaries Through Sanctions Act”) overwhelmingly passed the House and Senate and has now been signed into law by the US President, albeit with two partly critical signing statements (here and here). The law represents significant development in sanctions against Iran, North Korea, and Russia.

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Filed under Sanctions and Money Laundering, US

Singapore: consultation on regulations for the provision of digital advisory services

In line with its recognition of the rapid expansion of, and new products within, the FinTech sphere, the Monetary Authority of Singapore (MAS) issued a consultation paper on 7 June 2017 on the provision of digital advisory services (i.e. advice on investment products using automated, algorithm-based tools, also known as “robo-advisory services”). The consultation closed on 7 July 2017. Continue reading

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Filed under Asia, Singapore

FCA publishes proposals to extend the Senior Managers and Certification Regime

The FCA has published proposals to replace the Approved Persons Regime with the Senior Managers and Certification Regime (SMCR) currently in force for banks. Almost all financial services firms will be required to comply with the SMCR. There is a separate consultation paper to extend the current Senior Insurance Managers Regime applicable to insurers to the full SMCR. Our recently published briefing contains a high level summary of the key elements of the new regime. The consultation ends on 3 November 2017. Continue reading

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Filed under Asset management, Banking, Funds, Investment banking, Investment Funds, UK

HKMA and PWMA in Hong Kong collaborate to develop a Treat Customers Fairly Charter for the PWM industry

On 8 June 2017, the Hong Kong Monetary Authority (HKMA) announced that it has been working together with the Private Wealth Management Association to develop a Treat Customers Fairly Charter (the Charter) to further promote a customer-centric culture in the private wealth management (PWM) industry.  The Charter is designed to complement, not change, current laws and regulations and the existing terms and conditions between banks and their customers.  It is stated to be a commitment by PWM institutions in Hong Kong to support and implement the principle of treating customers fairly.

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Filed under Hong Kong

Failure to Prevent the Facilitation of Tax Evasion offences to be implemented from 30 September 2017 – Criminal Finances Act 2017

The Criminal Finances Act 2017 (Commencement No. 1) Regulations 2017 were introduced on 13 July 2017 and will bring into effect the two new corporate criminal offences of "failure to prevent" the facilitation of UK and foreign tax evasion, included in Part 3 of the Criminal Finances Act 2017 ("the Act"), from 30 September 2017.

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Filed under UK Legislation

Hong Kong SFC consults on new rules and code for open-ended fund company structure

On 28 June 2017, the Securities and Futures Commission (SFC) launched a two-month consultation (Consultation) on the detailed legal and regulatory requirements applicable to the new open-ended fund company (OFC) structure.

Currently, investment funds in Hong Kong are established only in unit trust form. The OFC structure will allow investment funds to be established in corporate form.  The Securities and Futures (Amendment) Ordinance 2016, which is yet to take effect, provides the basic legal framework of the OFC structure and also empowers the SFC to make subsidiary legislation and issue codes and guidelines for the regulation of OFCs.

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Filed under Hong Kong