Corporate & Financial Weekly Digest

Corporate & Financial Weekly Digest

ESMA Publishes Opinion on Position Limits on UK Natural Gas Contracts Proposed by the FCA

Posted in EU Developments, Financial Markets

On October 5, the European Securities and Markets Authority (ESMA) published an opinion, dated September 24, on position limits on UK natural gas commodity futures and options contracts proposed by the UK Financial Conduct Authority (FCA).

ESMA received a notification from the FCA on February 7, under Article 57 of the revised Markets in Financial Instruments Directive (MiFID II), regarding the exact position limits the FCA intended to set for UK natural gas commodity futures and options contracts, in accordance with the methodology for calculation established in Delegated Regulation 2017/591 (RTS 21) and taking into account the factors set out in Article 57(3) of MiFID II.

In its opinion, ESMA concluded that the spot month position limit and the other months’ position limits comply with the methodology established in RTS 21 and are consistent with the objectives under Article 57 of MiFID II. Additionally, ESMA notes that the position limits set for the spot month and the other months “appear to achieve a reasonable balance between the need to prevent market abuse and to ensure an orderly market and orderly settlement, while ensuring that the development of commercial activities in the underlying market and the liquidity of the ICE Natural Gas contracts are not hampered.”

ESMA’s opinion is available here.

 

California Adopts Law Regarding Female Representation on Boards of Directors of Publicly Held Companies

Posted in SEC/Corporate

On September 30, California Governor Jerry Brown signed into law California Senate Bill 826 (SB 826), which requires a publicly held corporation with shares listed on “a major United States stock exchange” and whose principal executive offices are located in California (as reported on the corporation’s annual report on Form 10-K) (Covered Corporations) to have at least one female director serving on its board of directors by December 31, 2019. By December 31, 2021, a Covered Corporation must have at least (a) three female directors if its board consists of six or more members, (b) two female directors if its board consists of five members or (c) one female director if its board consists of four or fewer members. Under SB 826, a female is defined as any individual who self-identifies as a woman, regardless of such individual’s designated sex at birth.

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CFTC Releases White Paper Addressing Cross-Border Swaps Regulation

Posted in CFTC

On October 1, Commodity Futures Trading Commission Chairman J. Christopher Giancarlo released a white paper addressing the regulation of cross-border swaps. The white paper, titled “Cross-Border Swaps Regulation Version 2.0: A Risk-Based Approach with Deference to Comparable Non-U.S. Regulation,” sets forth various proposed changes to the CFTC’s current cross-border approach.

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CFTC and Australian Securities Regulator Sign FinTech Cooperation Agreement

Posted in CFTC

The Commodity Futures Trading Commission and the Australian Securities and Investments Commission (ASIC) have entered into a cooperation arrangement on financial technology innovation. The arrangement is intended to facilitate cooperation and the sharing of information between the CFTC and ASIC relating to financial technology and the use of technology for purposes of regulation and oversight of financial markets and participants.

More information is available here.

 

NFA Issues Notice on Calculating Financial Ratios on NFA Forms PQR and PR

Posted in CFTC

National Futures Association (NFA) has issued a notice to commodity pool operator (CPO) and commodity trading advisor (CTA) members clarifying the method by which CPOs and CTAs should calculate the Current Asset/Current Liability (CA/CL) ratios and the Total Revenue/Total Expenses (TR/TE) ratios for purposes of NFA Forms PQR and PR.

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LIBOR Replacement Language Published for Comment

Posted in Banking

The Alternate Reference Rates Committee, operating under the auspices of the Federal Reserve, has published two consultations concerning the replacement of the London Inter-bank Offered Rate (LIBOR) in financial contracts. One consultation deals with floating rate notes and the other deals with syndicated business loans. The consultations contain draft fallback provisions for contracts referencing LIBOR that are intended to minimize disruption when the calculation of LIBOR, in its current form, is discontinued or the rate is no longer usable as a practical matter. Continue Reading

Federal Banking Agencies Issue Interagency Statement on Sharing Bank Secrecy Act Resources

Posted in Banking

On October 3, the Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Financial Crimes Enforcement Network, the National Credit Union Administration and the Office of the Comptroller of the Currency released a joint statement related to the permissible sharing of Bank Secrecy Act (BSA) resources.

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HM Treasury Publishes Draft EMIR SI Relating to Non-UK CCPs Post-Brexit

Posted in Brexit, Financial Markets, UK Developments

HM Treasury published a draft statutory instrument (SI) under the European Market Infrastructure Regulation (EMIR) relating to non-UK central counterparties (CCPs) after the United Kingdom’s withdrawal from the European Union (exit day). It has also published a supporting explanatory memorandum.

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ESMA Updates Q&As Relating to the Market Abuse Regulation

Posted in EU Developments, Financial Markets

On October 1, the European Securities and Markets Authority (ESMA) published an updated version of its sets of question and answer documents (Q&As) on the Market Abuse Regulation (MAR). ESMA has added three new questions and answers relating to the delay of the disclosure of inside information by a credit or financial institution to preserve financial stability under Article 17(5) of MAR:

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