Latest Shake-up of the Remuneration Provisions for Banks and Investment Firms Part 2: Banks and credit institutions

Authors: Mark Ife and Paul Ellerman

After over two years of debate, agreement has finally been reached on the proposed directive amending the Capital Requirements Directive (which is generally being titled CRD5), and the European Council has published its final text.

As detailed in our previous briefing, however, the proposed new prudential regime for investment firms, will remove most investment firms from the scope of CRD5 and subject them to the specific remuneration rules in the new Investment Firms Directive (IFD) and Investment Firms Regulation (IFR). Consequently, the revised CRD5 is likely only to apply to banks and “bank-like” investment firms.

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Harmonising the regulation of market abuse in Europe

The European Commission has published its proposals for a Regulation on insider dealing and market manipulation (“the Regulation”) and a Directive on criminal sanctions for intentional market abuse (“the Directive”). The new measures will extend the scope of the existing regime to ensure that regulation keeps pace with market developments, to reinforce the investigative and sanctioning powers of regulators, and to better combat market abuse across commodity and related derivative markets.

The Commission has also published Frequently Asked Questions on the proposals and Frequently Asked Questions on Emissions Allowances. The proposals accompany revisions to the Markets in Financial Instruments Directive which aim to increase financial market oversight and transparency.

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