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. 

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

CLIFFORD CHANCE BRIEFINGS AND MATERIALS

• (21 Oct 2022) Talking Tech article – Metaverse and privacy: The views of the Spanish Data Protection Agency
• (20 Oct 2022) Talking Tech article – Digital settlement assets - the next stage in UK cryptoasset regulation
• (20 Oct 2022) Talking Tech article – Venture Debt: A lifeline for tech start-ups and growth companies
• (19 Oct 2022) Clifford Chance briefing – New Bargaining Chips: US Department of Commerce Imposes New Export Controls on the Semiconductor Industry and Imposes Changes to the UVL and Entity List
• (19 Oct 2022) Clifford Chance briefing – Competition Policy for FinTech M&A – What to Expect When You're Expecting…a FinTech M&A Deal

GLOBAL LEGAL AND REGULATORY UPDATES, INDUSTRY GUIDANCE AND PUBLICATIONS

International

• (21 Oct 2022) The Bank for International Settlements Innovation Hub has completed its first retail central bank digital currency (CBDC) system. Project Aurum was carried out by the Innovation Hub's Hong Kong Centre in partnership with the Hong Kong Monetary Authority and the Hong Kong Applied Science and Technology Research Institute. Aurum is a full-stack (front-end and back-end) CBDC system comprising a wholesale interbank system and a retail e-wallet system. The aim was to bring to life two very different types of tokens: intermediated CBDC and stablecoins backed by CBDC in the interbank system. | Project webpage
• (19 Oct 2022) CFA Institute has released a paper entitled Ethics and Artificial Intelligence in Investment Management: a Framework for Professionals, which includes new research and an accompanying ethical decision framework to motivate the evolution of ethical practices in the development of artificial intelligence (AI) technologies in investment management. | Press release

Africa

South Africa:

• (19 Oct 2022) Financial Sector Conduct ​Authority notice declaring cryptoassets as a financial product under the Financial Advisory and Intermediary Services Act.

APAC

Hong Kong:

• (24 Oct 2022) The Hong Kong Monetary Authority (HKMA) has announced the official launch of Commercial Data Interchange, one of the key initiatives under the HKMA's 'Fintech 2025' strategy to create a next-generation data infrastructure and form an ecosystem for secure and seamless data exchange in Hong Kong. | Press release

Singapore:   

• The Monetary Authority of Singapore (MAS) has published two consultation papers proposing regulatory measures to reduce the risk of consumer harm from cryptocurrency trading and to support the development of stablecoins as a credible medium of exchange in the digital asset ecosystem. These measures will be part of the Payment Services Act. Consultation deadline: 21 December 2022 | Consultation Paper on Proposed Regulatory Measures for Digital Payment Token Services | Consultation Paper on Proposed Regulatory Approach for Stablecoin-Related Activities | Press release
• (18 Oct 2022) MAS consultation on proposed amendments to the limits currently imposed on each personal payment account that contains e‑money issued by a major payment institution. Consultation deadline: 25 November 2022.

Europe

EU:

• (24 Oct 2022) The EU Commission has launched the EU Supervisory Digital Finance Academy, which is intended to help financial supervisory authorities to seize the opportunities and cope with the risks related to the use of advanced technologies in the financial sector. | Press release
• (21 Oct 2022) Commission Delegated Regulation (EU) 2022/1988 on extending the transitional period for continuing to provide crowdfunding services under the Crowdfunding Regulation has been published in the Official Journal. The Delegated Regulation extends the transitional period from 10 November 2022 to 10 November 2023, allowing ECSPs that have been authorised under national law to continue their business activities to avoid disruption to the crowdfunding markets.
• (18 Oct 2022) Report on approaching the regulation and supervision of decentralised finance, commissioned by the EU Commission and written by Professor Tarik Roukny.

France:          

• (21 Oct 2022) Speech by First Deputy Governor of the Banque de France, Denis Beau, on the mounting risks to the fintech innovation ecosystem and how the Banque de France and the Autorité de contrôle prudentiel et de resolution (ACPR) can help to tackle them.
• (19 Oct 2022) Speech by Governor of the Banque de France and Chairman of the ACPR, François Villeroy de Galhau, on helping fintechs to become a lasting and integral part of the financial landscape while continuing to keep pace with the digital transformations under way, especially in cryptoassets.

UK:

• (25 Oct 2022) Financial Conduct Authority Discussion Paper (DP22/5) on the potential competition impacts of Big Tech entry and expansion in retail financial services. | Press release
• (25 Oct 2022) The House of Commons Business, Energy and Industrial Strategy Committee has published a report urging the Government to publish a draft Digital Markets Bill 'without delay' to help deter predatory practices by big tech firms. | Press release
• (21 Oct 2022) Financial Secretary to the Treasury and City Minister, Andrew Griffith MP, has tabled an amendment to Financial Services and Markets Bill, which would amend the Financial Services and Markets Act 2000 to clarify that the powers relating to financial promotion and regulated activities can be relied on to regulate cryptoassets and activities relating to cryptoassets. Cryptoasset is also defined, with a power to amend the definition.
• (20 Oct 2022) The House of Commons Science and Technology Committee has launched an inquiry into the governance of AI. In the inquiry, MPs will explore how risks posed to the public by the improper use of AI should be addressed, and how the Government can ensure AI is used in an ethical and responsible way. The Committee is seeking evidence on the current governance of AI, whether the Government’s proposed approach is the right one, and how their plans compare with other countries. The deadline for responses is 25 November 2022. | Call for evidence
• (19 Oct 2022) Speech by Carolyn Wilkins, an external member of the Bank of England's Financial Policy Committee, on the governance of decentralised finance, calling on the crypto industry to build best practices in governance, codes of conduct, and set high expectations for transparency.

EVENTS

• Global Financial Markets Perspectives Series: Space Tech – a universe of ‘here and now’ investment opportunities (online, 8 November 2022): Space Tech is not just about futuristic colonies on Mars and asteroid-mining, it is also about the constellations of satellites that are already supporting so much of the tech here on earth, including ESG applications such as environmental monitoring. It is also critical infrastructure for the defence sector. Our panellists will discuss opportunities in the sector, New Space, financing considerations and the future direction of the industry. | To register, please see the event series registration form.
• Global Financial Markets Perspectives Series: The future of banking – can CBDCs and custody of digital assets change the financial markets? (online, 15 November 2022): In this session we will consider some use cases for Central Bank Digital Currencies and how they may impact the financial markets particularly when combined with digital assets. This session will provide practical insights for in-house lawyers on novel legal issues that arise from CBDCs and how the role of custodian of digital assets may be evolving. | To register, please see the event series registration form
• Global Financial Markets Perspectives Series: Managing AI in an evolving legal landscape (online, 29 November 2022): Our experts will examine recent legal developments in a number of jurisdictions, consider key issues affecting the successful deployment and management of AI and machine learning, look ahead to expected changes to relevant regulatory regimes and discuss what businesses can do to prepare.| To register, please see the event series registration form