1. Welcome to Legal Shorts, a short briefing on some of the week’s developments in
the financial services industry.
Listen to this week's Legal Shorts on CLTV by going to
http://vimeo.com/cummingslaw
If you would like to discuss any of the points we raise below, please contact me or
one of our other lawyers.
Claire Cummings
020 7585 1406
claire.cummings@cummingslaw.com
www.cummingslaw.com
EVENTS:
N@ked Short Club on Resonance FM on Monday 16 February: Claire
Cummings will participate in a discussion on hedges funds on the
N@ked Short Club on Monday 16 February. The radio programme will be
hosted by Dr. Stu between 9 and 10pm on Resonance FM (join on 104.4FM
or online via www.resonancefm.com).
The Bloomberg Hedge Fund Start-up Conference 2015 on Thursday 5
March: Claire Cummings will be taking part in this year’s Bloomberg
start-up conference, which will be held at Bloomberg’s offices on Finsbury
Square on 5 March from 9.00am – 6.00pm. To register please go to
www.bloomberglp.com/HF15_reg.
BDO/Cummings Law Asset Management Webinar: Tax & Legal Update
on Wednesday 11 March Cummings Law will join BDO to present a
webinar giving an update on recent tax and legal issues in the asset
management industry on Wednesday 11 March from 1.00pm – 2.00pm. To
register please contact Helen Armstrong on helen.armstrong@bdo.co.uk
Short video on reverse solicitation available soon: A two minute video
on reverse solicitation presented by Claire Cummings will be available
shortly on CLTV at http://vimeo.com/cummingslaw.

2. G20 issues communique on financial services issues
The G20 has published a communique following the meeting of finance
ministers and central bank governors in Istanbul on 9 and 10 February
2015. Areas addressed include: (i) the "too big to fail" problem; (ii)
enhancing cross-border cooperation, particularly in the areas of resolution;
(iii) OTC derivatives markets reform: (iv) implementing the shadow
banking roadmap; (v) work by the Financial Stability Board (FSB) on
potential financial stability risks arising from systemically important CCPs;
and (vi) counter-terrorism financing work to be undertaken by FATF.
FSB publishes letter to G20 finance ministers
The Financial Stability Board has published a letter that it has sent to G20
finance ministers and central bank governors outlining its priorities for
financial reforms during the Turkish G20 Presidency. In the letter, the FSB
sets out the regulatory developments it expects before the G20 leaders'
summit in November this year. The FSB's work programme is intended to
advance the regulatory priorities set in the G20 leaders' summit in Brisbane
in November 2014, relating to the following areas of reform: (i)
implementation of agreed reforms; (ii) finalising the design of remaining
post-crisis reforms; and (iii) addressing new risks and vulnerabilities,
particularly those relating to market-based finance and conduct.
FCA publishes guidance on transaction reporting user pack
The FCA has published final guidance on the transaction reporting user pack
(TRUP) following the results of its guidance consultation in May 2014.
TRUP provides guidance on the transaction reporting obligations that come
from MiFID, which are implemented through SUP 17 of the FCA
Handbook. The feedback received provided overall support for the FCA’s
clarifications, which covered the following areas: (i) how the unit price
should be reported for different instruments; (ii) how to report the venue for
a transaction; (iii) the transaction reports a firm sends for its transactions
must accurately reflect the change in position for the firm and its client(s)
resulting from the transactions; and (iv) a firm hitting its own order on a
trading venue should transaction report the resultant transaction. Subject to a
few exceptions, the new version of TRUP is effective immediately.

3. House of Lords launches inquiry into proposed CMU
Following confirmation last week by the European Commission that it will
launch a green paper consultation on a capital markets union (CMU), the
House of Lords EU Sub-Committee on Economic and Financial Affairs has
announced the launch of an inquiry into the Commission's proposals. The
inquiry will examine what the CMU is, the problems it is seeking to address,
the key components of the CMU, the timetable and what drawbacks exist in
pursuing a CMU and what obstacles need to be overcome. Public evidence
sessions will be held this month and the Sub-Committee will publish its
findings in March.
Investment Association paper on transaction costs and charges
The Investment Association has published a discussion paper on the
meaningful disclosure of costs and charges. The aim of the paper is to
define a framework for charge and transaction cost disclosure that would
provide the underlying component pieces for good disclosure. It is based on
a set of principles for good disclosure, which are set out in appendix 1 to the
paper, and builds on the Association's work over the past three years. The
paper sets out the difference between product charges and transaction costs
and explains why both should be disclosed separately. It also proposes a
single methodology that it considers could be introduced in disclosures to
clients and proposes a "product neutral approach" for charge and transaction
cost disclosure. The issues discussed in the paper will also be the subject of
regulatory outputs in the UK and the EU in the near future, such as MiFID
II.
EU approves MDL4 and Wire Transfer Regulation agreement
The EU Council has approved the political agreement with the European
Parliament on the proposed Fourth Money Laundering Directive (MLD4)
and the proposed revised Wire Transfer Regulation (WTR). In its press
release, the Council states that its approval will enable adoption of the
package of measures at second reading. Member states will have two years
to transpose MLD4 into national law, while the WTR will be directly
applicable.

4. European Parliament to consider MMF Regulation
The European Parliament has updated its procedure file on the proposed
Regulation on Money Market Funds (MMF Regulation). The Parliament
will now consider the proposed Regulation during its plenary session to be
held on 25 March 2015. The Parliament had previously indicated that it
would consider the Regulation at its 28 April 2015 plenary session.
EU and Greece fail to agree on bailout
Greece and Eurozone finance ministers this week failed to agree on a
solution to the bailout but talks will resume next week. Jeroen
Dijsselbloem, the chairman of Eurogroup finance ministers, said that the
ministers had “had an intense discussion, constructive, covering a lot of
ground, also making progress, but not enough progress yet to come to joint
conclusions”. The Greek finance minister has proposed a six-month
transition in which Greece would be allowed to issue more short-term debt,
receive the proceeds of ECB holdings of Greek bonds and tap unused bank
rescue funds while renegotiating its debt. Greece would swap its euro zone
loans for GDP-linked bonds and its ECB-held debt for interest-bearing
perpetual bonds with no reimbursement date. EU officials have said the
most Greece can expect is a further extension of the repayment deadline for
its euro zone loans, a lower interest rate and perhaps a prolonged
moratorium on debt service payments, in return for continued reforms under
some form of external supervision.
EU Council proposal on Benchmark Regulation
The EU Council has published the latest compromise proposal relating to
the proposed Benchmark Regulation, which has been agreed as a negotiating
mandate for the Council Presidency for the negotiations with the European
Parliament. The proposal recommends that COREPER agree on the
negotiating mandate for the proposed Regulation, as set out in the Annex
and to invite the Council Presidency to start, when practicable, negotiations
with the European Parliament on the basis of that mandate with a view to
reaching an agreement at first reading.

5. Cummings
Tel: + 44 20 7585 1406
Mob: + 44 7734 057 327
www.cummingslaw.com
13 February 2015
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