Global Trustee and Fiduciary Services Bite-Sized Issue 4 2024

Global Trustee and Fiduciary Services Bite-Sized | Issue 4 | 2024 6 QUICK LINKS AIFMD BENCHMARK REGULATION CBDC COSTS & CHARGES CRYPTOASSETS CYBERSECURITY DIVERSITY & INCLUSION FINTECH IFD/IFR LIBOR TRANSITION MIFID II/MIFIR OPERATIONAL RESILIENCE PRIIPS RETAIL INVESTMENT STRATEGY SETTLEMENT SUSTAINABLE FINANCE/ESG UCITS ASIA LUXEMBOURG NORTH AMERICA UNITED KINGDOM FCA Updates Position on Cryptoasset Exchange Traded Notes for Professional Investors On 11 March 2024, the UK Financial Conduct Authority (FCA) published a statement on requests from Recognised Investment Exchanges (RIEs) to create a UK listed market segment for cryptoasset-backed Exchange Traded Notes (cETNs). The FCA states that these products would be available for professional investors, such as investment firms and credit institutions authorised or regulated to operate in financial markets only. The FCA says that exchanges will need to continue to make sure sufficient controls are in place, so trading is orderly and proper protection is afforded to professional investors. cETNs must meet all the requirements of the UK Listing Regime, for example on prospectuses and on-going disclosure. The FCA states that it continues to believe cETNs and crypto derivatives are ill-suited for retail consumers due to the harm they pose. As a result, the ban on the sale of cETNs (and crypto derivatives) to retail consumers remains in place. The FCA continues to remind people that cryptoassets are high risk and largely unregulated. Those who invest should be prepared to lose all their money. The FCA states that it is collaborating with government, international partners and industry to develop the UK’s cryptoasset regulatory regime and lead international standards in this space. Link to Full Statement here CYBERSECURITY Cyber Solidarity Package: Council and Parliament Strike Deals to Strengthen Cyber Security Capacities in the EU On 6 March 2024, the Council of the EU presidency and European Parliament’s negotiators reached a provisional agreement on the so-called ‘cyber solidarity act’, as well as on a targeted amendment to the cybersecurity act (CSA). Main elements of the cyber solidarity act The new regulation establishes EU capabilities which aim to make Europe more resilient and reactive in front of cyber threats, while strengthening cooperation mechanisms. It aims to: • Support detection and awareness of significant or large-scale cybersecurity threats and incidents; • Bolster preparedness and protect critical entities and essential services, such as hospital and public utilities; • Strengthen solidarity at EU level, concerted crisis management and response capabilities across member states; and • Contribute to ensuring a safe and secure digital landscape for citizens and businesses. The new regulation also provides for the creation of a cybersecurity emergency mechanism to increase preparedness and enhance incident response capabilities in the EU. It aims to support: • Preparedness actions, including testing entities in highly critical sectors (healthcare, transport, energy, etc.) for potential vulnerabilities, based on common risk scenarios and methodologies; • A new EU cybersecurity reserve consisting of incident response services from the private sector ready to intervene at the request of a member state or EU institutions, bodies, and agencies as well as associated third countries in case of a significant or large-scale cybersecurity incident; and • Mutual assistance in financial terms. Finally, the new regulation establishes an evaluation and reviewmechanism to assess, amongst others, the effectiveness of the actions under the cyber emergency mechanism and the use of the cyber security reserve, as well as the contribution of this regulation to strengthening the competitive position of the industry and service sectors.