Apparently 2014 is the year of the horse, or so I have heard. It seems more likely that the City will come to regard it as the year of the hearse, come to take away the remains of a once loved financial services industry, sadly now regulated to death. That might not be the most up-beat note on which to start the year, but there are many ways in which this year will be pivotal to the future of the industry. We still have a chance to save ourselves, but it is a long way from certain that we will do so.
You will, I am sure, be looking forward to the full implementation of AIFMD. Getting the application in is now an urgent priority. Yes, you don’t need to be AIFMD-authorised until 22 July; no you can’t leave it any longer before you make the formal application to FCA. If you have not yet been brave enough to look at the application form, lose no time in enjoying a preview. There’s plenty to do to keep you amused over the coming months, but actually it is more urgent than that. If you haven’t viewed the FCA’s recent comments, you should look at Alternative Investment Fund Managers Directive (AIFMD) – Financial Conduct Authority.
It may well be that you have not been able to look at AIFMD because you have been tackling EMIR. Clearly EMIR is very important otherwise the European Commission would not have rejected ESMA’s advice for a postponement of reporting of transactions in exchange traded derivatives. And ESMA would not have taken so long to authorise trade repositories. So, it begins in earnest on 12th February. EMIR – Financial Conduct Authority. Luckily you have not got anything else pressing over the next couple of months. Except AIFMD, that is.
For an investment firm, its capitalisation is hardly the most pressing concern of its customers. Much to the firm’s chagrin, customers are more concerned with their own well-being than the firm’s; it does not really matter to them if you go under, provided that you have done the right thing by CASS. So they won’t ask you how you are getting on with CRD IV – they will leave that to the regulator, the regulator who was made to care because the EU believes that it is good for the soul of the investment firm that it should be capitalised as if it were a bank. So unless you are lucky enough to be a new-look BIPRU firm, you will have spent your Christmas adjusting for a standard which will mean that if you were a bank and the crisis hit again, you would survive. If, on the other hand, you spent Christmas enjoying mince pies, you have some urgent work to do. CRD IV – Financial Conduct Authority. Luckily you have not got anything else pressing over the next couple of months. Except EMIR, that is. Oh, and AIFMD.
So it is, as I mention to you the FCA consultation on the use of dealing commission, that I imagine myself playing with fire. Actually, I can already hear the sniggering as I dare to mention new rules that won’t be in place for many months. That’s tomorrow’s problem. Well, only sort of. You see, FCA is just clarifying what it always intended and now that it is clear, we can’t credibly claim we did not understand. CP13/17 – Consultation on the use of dealing commission rules – Financial Conduct Authority. So, as you have not got much else on, you may as well look at how you measure up against the revealed truth.
As feelings of helplessness envelope the industry, there actually is something you can do about it – you can respond to the government’s Balance of Competences survey and tell them what they can do with the European regulators. https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/251514/PU1568_BoC_FSFMC_CfE_proof4.pdf. Pity you won’t have time.
Oh, and FCA is taking a particular interest in outsourcing. Are you?
Happy New Year.