The FSA is consulting (as it is required to do under the Act) on the new power given to the FCA under the Financial Services Act 2012 to issue temporary product intervention rules without the chore of a consultation (CP12/35).
Such rules cannot be in force for more than 12 months – but that alone is far from an adequate safeguard when the rules we are talking about include banning a product from sale.
So, what more is needed to allay concerns that it will be used inappropriately? Continue reading
As regulatory rules are increasingly made in Europe, within the UK, the new Financial Conduct Authority (FCA) will move to becoming – as Hector Sants put it – a “supervisory arm” of Europe in relation to conduct issues. But has the UK really given enough thought to compatibility with European legislation, and to the need for coordination and cooperation with the ESAs and other competent authorities, or are we enshrining potential problems for ourselves in the proposed legislation and policy approach?
In considering the proposals in the UK’s Financial Services Bill (the FS Bill) to give FCA product intervention powers, the interaction with European requirements and the role of the European Supervisory Authorities (the ESAs) assume heightened importance. Concerns about this interaction were a continuing theme emerging from responses to the FSA’s discussion paper on product intervention.
The FCA has confirmed that its Product Intervention Committee and the Board will have due regard to how the national approach fits within the wider EU legislative framework and that they will, where appropriate, recommend consideration of the same issues at EU level. There is also an acknowledgment that there may be a need to change national rules with the advent of new European rules. These are welcome assurances, but may not go far enough to address some of the issues to which the interaction of UK and EU product intervention powers may give rise.
The introduction of the Financial Services Bill to Parliament last Friday is a significant milestone in the reform of the financial services regulatory architecture.
This briefing highlights the key differences between this Bill, and the draft Bill published in June 2011 (covered in our earlier briefing).
Today, the Joint Committee appointed by both Houses of Parliament to conduct pre-legislative scrutiny of the draft Financial Services Bill 2011, reported on its examination of the Bill. The report is critical of many aspects of the Bill as not going far enough, and recommends a number of significant amendments to the objectives, powers and accountability of the new regulators. This briefing summarises the recommendations. Continue reading