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The Future of Financial Services Regulation

4 October 2016

The Financial Services Group hosted a seminar last week, looking at the Future of Financial Services Regulation, particularly in the light of the Brexit vote.

The seminar featured opening talks from both Jessica Arrol on the apparently rapidly approaching PRIIPs Regulation and Vanessa Walters on MiFID 2. The talks were followed by a Brexit panel discussion chaired by Kate Troup. The panel included Jonathan Bayliss, head of Financial Services Regulation and William Garner. We were also fortunate enough to have European representation, welcoming Olivier Cavadani from our Geneva office and David Louis, of our Luxembourg office.

Key takeaways from the event

UK Implementation of the PRIIPs Regulation

Jessica Arrol opened the seminar with a talk on the upcoming Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation (the Regulation), due to be implemented on 31 December 2016.  Following a previous rejection of the Level 2 measures in the European Parliament and calls for a delay from the European council, Jessica remained cautiously optimistic that a delay will be announced shortly and that it would be the most sensible course of action.

The Regulation introduces an obligation on the manufacturers of PRIIPs to draw up a key information document (KID). The content of the KID is prescribed in the Regulation and in follow-up regulatory technical standards (it was the proposed draft of these which has just been rejected by European Parliament).  A person advising on or selling a PRIIP must provide a retail investor with the KID in good time before the retail investor is bound. The definition of a PRIIP is very broad and catches a wide range of financial instruments including regulated and unregulated collective investment schemes, shares in investment trusts, insurance based investment products, derivatives and structured products. 


Vanessa Walters provided an overview of MiFID 2 and its key implications. This covered the general objectives of MiFID 2, the changes to MiFID that it introduces (including the additional investor protection provisions) and the new areas that it brings under regulation (including organised trading facilities). Vanessa went on to discuss the cost implications for firms and how firms should be preparing for some of the IT changes that will be required to comply with the increased reporting requirements.

Financial Services Regulation post Brexit
  • The overriding principle of the discussion was that our clients should not panic, but should ensure they are prepared for the potential outcomes post-Brexit, whether “hard” or “soft”.
  • The UK financial services sector has played a major role in shaping (and indeed gold plating on occasion) financial services regulations within the European Union and Jonathan Bayliss is hopeful that in time common sense will prevail and a passporting deal for the financial services sector in the UK can be struck.
  • David Louis, head of the Luxembourg office, offered a non-British perspective of Brexit from within the EU, insisting that Luxembourg is keen to stand as a key business partner with Britain and not a competitor.
  • Representing Switzerland (a third country) in the discussion, Olivier Cavadani of our Geneva office was able to offer us the Swiss experience and potential approaches in negotiating financial services deals cross-border with the EU.
  • Nobody knows what the ultimate outcome of negotiations on Brexit will be and whilst we remain hopeful that a sensible agreement will be reached, businesses need to be prepared.

Charles Russell Speechlys offers clients a wide ranging international perspective both within and beyond the EU and is well placed to advise clients on the challenges that the changing regulatory landscape may present.

If you would like to discuss any of these issues further, please contact Jonathan Bayliss on +44 (0)20 7427 6699 or at jonathan.bayliss@crsblaw.com.