Clifford Chance

Welcome to this week's global fintech round-up, summarising fintech regulatory developments that have happened around the world along with our Clifford Chance fintech publications and upcoming events.Watch the video here to hear more.

Details of these and previous developments can also be found on our Fintech Topic Guide on the Clifford Chance Financial Markets Toolkit.

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CLIFFORD CHANCE PUBLICATIONS AND MATERIALS

• (15 Feb 2021) Talking Tech video – Tech trends 2021: predictions for PropTech
• (12 Feb 2021) Talking Tech video – Tech trends 2021: predictions for US content moderation and privacy reform
• (12 Feb 2021) Talking Tech article – Are all search engines incompatible with sui generis database rights? Quite possibly, yes

SPOTLIGHT: 

Tech trends 2021: predictions for Tech and Antitrust

Sharis Pozen, Partner and co-chair of our global Antitrust team, shares her predictions for Tech and antitrust in 2021 in this short video. From continued global antitrust enforcement against Big Tech firms and greater focus by antitrust authorities on the use of algorithms​, machine learning and blockchain​ to the growth in antitrust litigation in adtech and more scrutiny of Tech M&A, Sharis reveals what companies should be anticipating.

Watch the video here to hear more.

GLOBAL LEGAL AND REGULATORY UPDATES

Africa

Nigeria:

• (11 Feb 2021) Securities and Exchange Commission (SEC) statement on the regulatory treatment of cryptoassets in light of the letter​ issued by the Central Bank of Nigeria (CBN) on 5 February 2021. CBN's letter prohibited financial institutions from providing services to cryptoasset exchanges, which was deemed to contradict the SEC's statement of September 2020 that stated cryptocurrencies fall under the existing regulatory regime covering securities exchanges and transactions on exchanges. The SEC has therefore clarified that entities impacted by CBN's letter fall outside the regulatory framework.

Americas

Canada:       

• (11 Feb 2021) The Ontario Securities Commission has approved the first Bitcoin exchange-traded fund (ETF) in North America, granting permission to Accelerate Bitcoin ETF to trade on the Toronto Stock Exchange | SEDAR filing

US:  

• (9 Feb 2021) Blockchain Research Institute and Chamber of Commerce report containing recommendations on how the Biden-Harris administration could reimagine US technology strategy and policy. Among other things, the report sets out five key priorities: embracing cybersecurity to protect identity and privacy; understanding the digital dollar and other cryptocurrencies; engaging with citizens and holding officials accountable; stimulating America's innovation economy; and retooling government services. | Press release

APAC

Australia:            

• (12 Feb 2021) Hearing transcript from the Senate Select Committee on Financial Technology, in which the Committee discussed the barriers facing firms wishing to launch Bitcoin ETFs. The following day, Cathie Armour, the Australian Securities and Investments Commission (ASIC) Commissioner clarified ASIC's position on Bitcoin ETF initiatives, stating to the Committee that an ETF would be permitted as long as there were appropriate rules in place in the market on which it was traded.

China:            

• (11 Feb 2021) The Xiong'an branch of the Agricultural Bank of China has announced it has developed a hardware wallet for the country's central bank digital currency (CBDC). The wallet, which was developed in collaboration with the Party Working Committee of the Xiong'an New Area and the People's Bank of China branch in Shijiazhuang, supports dual offline payments without an internet connection and without requiring the use of a mobile phone. | Press release (in Chinese)

Europe

Europe:         

• (18 Feb 2021) Several institutions have published their responses to the EU Commission's proposals for digital operational resilience in the financial sector (DORA), including:
  • the International Regulatory Strategy Group; and
  • the World Federation of Exchanges
• (17 Feb 2021) European Securities and Markets Authority statement on the risks connected to trading decisions based on information shared on social media | Press release
• (17 Feb 2021) European Insurance and Occupational Pensions Authority (EIOPA) supervisory convergence plan for 2021. Among other things, EIOPA intends to prioritise work on the supervision of emerging risks, including the development of a set of principles for digital responsibility, establishing a system for the exchange of information between national competent authorities regarding cybersecurity and cyber-attacks, and by implementing the objectives and goals set out in its Cyber Underwriting Strategy, which was published in February 2020. | Press release

Bulgaria:      

• (17 Feb 2021) Speech from Nina Stoyanova, Deputy Governor and Head of the Banking Department of the Bulgarian National Bank, in which she discusses forthcoming developments in the area of payment services and digitalisation in the EU, including prioritising the digitisation of financial services, improving the acceptance of digital payments in the public and private sector and creating a common space for financial data

Guernsey:    

• (15 Feb 2021) Guernsey Financial Services Commission revised rules and guidance on cybersecurity, which have been designed to ensure the Bailiwick's regulatory regime continues to comply with international standards | Press release

Luxembourg:              

• (8 Feb 2021) Commission de Surveillance du Secteur Financier report​ on its recent work in the area of financial innovation, including the creation of a new 'innovation hub' within its Innovation, Payments, Market Infrastructures and Governance Department, and its research into distributed ledger technologies, cryptoassets and their service providers, the emergence of new payment services providers, the use of artificial intelligence, and the provision of robo-advice and crowdfunding services

Russia:          

• (15 Feb 2021) Bill on amendments to parts one and two of the Tax Code (in Russian) has been introduced to the State Duma. The proposed law defines cryptocurrencies as property and introduces a tax on profits made from trading them. Entities are required to report on any cryptoasset transactions over RUB 600,000 (EUR 8,100) on an annual basis. | Press release (in Russian)

Sweden:       

• (12 Feb 2021) The Swedish Central Bank, Riksbank, has announced that its pilot project to develop a technical solution for a central-bank issued digital krona is being extended to February 2022. The next year of the project will focus on performance, scalability and the testing of offline functions, as well as bringing external participants into the test environment. | Press release

UK:

• (18 Feb 2021) Financial Conduct Authority (FCA) update on the outcomes of its recent Digital Sandbox pilot. The pilot provided enhanced support to firms seeking to develop innovative solutions to the challenges caused by the COVID-19 pandemic. The FCA hosted a series of open showcase sessions where participants presented the solutions they had developed, including to:
  • improve access to finance for SMEs;
  • improve the financial resilience of vulnerable consumers; and
  • detect and prevent fraud and scams.
• (17 Feb 2021) Information Commissioner's Office data analytics toolkit​, which has been designed to guide organisations through some of the key data protection points they need to think about when undertaking a project involving data analytics and personal data | Press release
• (15 Feb 2021) FCA report​ on the opportunities and challenges posed to financial institutions and consumers by the introduction of a digital identity system.

CLIFFORD CHANCE EVENTS

Clifford Chance Global Funds Week 2021 (22-26 February 2021):
Clifford Chance are delighted to invite you to our Global Funds Week 2021. The week-long series will feature multiple panel discussions and fireside chats with leaders in the asset management industry from across the globe. Topics include: tech and fintech developments impacting the funds sector in 2021; trends and predictions in ESG; diversity and inclusion in the fund management industry – taking stock, harnessing change and looking to the future; foreign investment restrictions across the globe; and what to expect on regulatory enforcement in 2021. | Please see the full list of speakers here. For Asia Pacific clients, please register using the APAC registration form. For all others, please register using the Global registration form.

UK and EU Trade Cooperation Agreement (25 February 2021):
Clifford Chance and the International Trade & Forfaiting Association (ITFA) invite you to an exploration of the new UK-EU Trade and Cooperation Agreement, the blueprint for future relations between the bloc and the UK. Economists and lawyers will draw out the costs and potential opportunities, and will consider how the agreement works with particular reference to trade finance and the role of fintech. | To register, please see the event registration form.

Additional Information

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This publication does not necessarily deal with every important topic nor cover every aspect of the topics with which it deals. It is not designed to provide legal or other advice. Clifford Chance is not responsible for third party content. Please note that English language translations may not be available for some content. 

The content above relating to the People's Republic of China (PRC) is based on our experience as international counsel representing clients in business activities in the PRC and should not be construed as constituting a legal opinion on the application of PRC law. As is the case for all international law firms with offices in the PRC, whilst we are authorised to provide information concerning the effect of the Chinese legal environment, we are not permitted to engage in Chinese legal affairs. Our employees who have PRC legal professional qualification certificates are currently not PRC practising lawyers.