Earlier today the Supreme Court handed down its hotly-anticipated judgment regarding the certification of an opt-out competition collective action brought by Walter Merricks against Mastercard. The claim is seeking £14bn in damages on behalf of some 46.2 million UK consumers, in respect of losses alleged to have resulted from the use of anti-competitive multilateral interchanges fees.
In this blog post, we round-up forthcoming developments in the UK and at EU and International levels in financial services regulation for August 2019.
On 21 February 2019, the FCA announced its first decision under its competition enforcement powers, finding three asset management firms have breached competition law. This decision is an important assertion of the FCA’s intention to use its competition powers – previous matters which involved the FCA were subsequently taken over by the European Commission under EU competition law. In its announcement, the FCA emphasised its commitment to taking enforcement action to protect competition, issuing a warning to the asset management industry to avoid undermining the proper process for setting the prices of shares in IPOs and placings and the potential impact failure to do so has on the UK’s capital markets.
To read our full briefing on the decision, please click here.
On 28 June 2017, the FCA published the highly anticipated final findings of its Asset Management Market Study ("Final Report"), which can be accessed here. This follows the release of its interim report in November 2016 and the subsequent intensive consultation process with industry, in which some 153 submissions were filed.
Herbert Smith Freehills recently held its annual disputes client conference exploring some key legal and compliance risks facing major corporates. Following opening remarks by Mark Shillito, head of dispute resolution for the UK and US, there were presentations on cyber security, Brexit, insurance, class actions, decision analysis, privilege and internal investigations.
A summary of the conference from our Litigation team is below – if reading the full version of this post, you can jump down to read more detail on any of the sessions by clicking on the relevant heading.
The FCA has published its Asset Management Market Study Interim Report, which can be accessed here, with annexes. The FCA sets down a clear marker as to its direction of travel. Clearly uninhibited by Brexit on the horizon, it is entirely consistent with the thrust of recent European regulatory initiatives, driving hard a consumer focused agenda that champions value for money, transparency and accountability to investors. The report picks up on many of the themes that have recently received material press attention, including:
On 1 April 2015 the Financial Conduct Authority (FCA) obtained new concurrent competition powers under the Competition Act 1998 (CA98) and the Enterprise Act 2002 (EA02) for financial services in the UK. The Payment Systems Regulator (PSR) has also obtained competition enforcement powers for certain UK retail payment systems. Continue reading
The Competition and Markets Authority (CMA) and the Financial Conduct Authority (FCA) have agreed a new Memorandum of Understanding (MoU) which sets out a framework for co-operation between the two regulators in relation to competition issues, consumer protection, access to payment systems and the sharing of information for the performance of their functions. The MoU, dated 12 June 2014, replaces an earlier MoU of April 2013 between the CMA’s predecessor, the OFT, and the FCA. Continue reading
The FSA and the Bank of England (BoE) have published the results of their review into barriers to new entrants to the banking sector. The Review sets out significant changes to regulatory requirements and authorisation processes which, taken together, aim to reduce some of the regulatory barriers to entry into the banking sector and thereby facilitate an increased competitive challenge to existing banks. The reduction of barriers to entry will be welcome news to new entrants to the banking market, although it is interesting to note (since under the new regime, it is the Financial Conduct Authority (FCA) that will have the direct competition remit) that it is the concessions that the Prudential Regulation Authority (PRA) will make on capital and liquidity that are most likely to facilitate increased competition.