Global Trustee and Fiduciary Services Bite-Sized Issue 12 2023

Global Trustee and Fiduciary Services Bite-Sized | Issue 12 | 2023 4 QUICK LINKS AIFMD BENCHMARK REGULATION CBDC COSTS & CHARGES CRYPTOASSETS FUND LIQUIDITY LIBOR TRANSITION MiCA OPERATIONAL RESILIENCE UK PRIIPs SUSTAINABLEFINANCE/ESG ASIA EUROPE IRELAND NORTH AMERICA UNITED KINGDOM If entities provide further factual information such as a breakdown of the costs to put the aggregate number in context, or include this information in their wider communication documentation, the FCA confirms that it will not take enforcement action to the extent that the firm contravenes the restriction on adding further information to the UCITS KIID or the prescriptive requirements of the PRIIPs KID. This also extends to materials issued by MiFID firms that distribute PRIIPs or UCITS. Firms must continue to comply with other relevant rules and requirements. These include the Consumer Duty and, where this does not apply, Principle 7, which requires firms to ensure communications are fair, clear and not misleading, and the requirements in COBS 2.1.1R to act honestly, fairly and professionally in accordance with the best interests of clients. The aim of the forbearance Statement is to give greater flexibility for costs to be explained, including putting aggregate costs in context – pending more substantive change which will be possible through legislation which will give the FCA power to change the rules more substantively. Link to Full Statement here CRYPTOASSETS UK Fund Tokenisation: A Blueprint for Implementation On 23 November 2023 the Investment Association published the Interim Report from the Technology Working Group to the Asset Management Taskforce. The Blueprint provides nine recommendations divided into two stages: • Stage 1- Recommendations the industry should follow to progress towards the full investment value chain operating on distributed ledger technologies (DLT) via a series of incremental stages covering: – Regulatory certainty for UK fund tokenisation; – Fostering DLT innovation across the UK investment management industry; and – Money laundering regulations registration process. • Stage 2 - Recommendations the industry should follow to identify the prioritisation and characteristics of future stages and work with the UK authorities to implement them, covering: – Industry to develop the details of further stages of fund tokenisation; – Availability of digital forms of money to settle transactions; – Legal considerations for investible assets; – Central Securities Depositary requirements and evolution of responsibilities; – Availability of digital identity; and – Availability of banking services. In addition to the Blueprint, the Financial Conduct Authority (FCA) published a letter to the Technical Working Group responding to the Blueprint and detailing the work it has undertaken as part of the development of the ‘baseline approach’ set out in the Blueprint, confirming that UK funds may transition some functions to DLT under the current rules laid out in the FCA Handbook. Link to the Blueprint here Link to the FCA Letter here