Global Trustee and Fiduciary Services Bite-Sized Issue 8 2023

Global Trustee and Fiduciary Services Bite-Sized | Issue 8 | 2023 3 QUICK LINKS ANTI-MONEY LAUNDERING CBDC COSTS & CHARGES CRYPTOASSETS CULTURE & CONDUCT CYBERSECURITY EMIR FINTECH FSB FUND LIQUIDITY MIFID II/MIFIR SUSTAINABLE FINANCE/ ESG AUSTRALIA ASIA IRELAND NORTH AMERICA UNITED KINGDOM The identified shortcomings concern: • Significant differences across firms and Member States in the format and content of ex-post disclosures; • Differing practices and sometimes no disclosure of information on inducements; • Lack of disclosure of implicit costs to clients; • Lack of consistency in the way firms illustrate the cumulative impact of the costs and charges on the return of the investment; and • Disclosing cost figures only in nominal amounts and not also the corresponding percentages. Concurrently with the CSA, ESMA coordinated and ran its first mystery shopping exercise on the ex-ante cost and charges information provided to retail clients. In most cases, mystery shoppers received information about costs and charges before the investment service was provided, however the quality and the timing of the information provided differed between firms. Link to the Statement here CRYPTOASSETS FSB Finalises Global Regulatory Framework for Crypto-asset Activities On 17 July 2023 the Financial Stability Board (FSB) published its global regulatory framework for crypto-asset activities to promote the comprehensiveness and international consistency of regulatory and supervisory approaches. The framework takes account of lessons from events of the past year in crypto-asset markets and feedback received during the FSB’s public consultation. The framework consists of two distinct sets of recommendations: High-level recommendations for the regulation, supervision and oversight of crypto-asset activities and markets. Revised high-level recommendations for the regulation, supervision, and oversight of “global stablecoin” arrangements. The final recommendations draw on the implementation experiences of jurisdictions and build on the principles – ‘same activity, same risk, same regulation’; high-level and flexible; and technology neutral – that informed the consultative framework. In light of events of the past year, the FSB has strengthened both sets of high-level recommendations in three areas: i. Ensuring adequate safeguarding of client assets; ii. Addressing risks associated with conflicts of interest; and iii. Strengthening cross-border cooperation. The recommendations focus on addressing risks to financial stability and do not comprehensively cover all specific risk categories related to crypto-asset activities. Central Bank Digital Currencies (CBDCs), envisaged as digitalised central bank liabilities, are not subject to these recommendations. The FSB has been working closely with the sectoral standard-setting bodies (SSBs) and international organisations to ensure that the work underway regarding the monitoring and regulation of crypto- asset activities andmarkets is coordinated, mutually supportive, and complementary. The global framework includes a shared workplan that the FSB and SSBs have developed for 2023 and beyond. Through this, they will continue to coordinate work under their respective mandates to promote the development of a comprehensive and coherent global regulatory framework, including through the provision of more granular guidance by SSBs, monitoring and public reporting. Link to the Framework here