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

Now available on-demand: International Festival of Fintech:

Thank you to everyone who joined the third Clifford Chance International Festival of Fintech last week, particularly our incredible speaker line up. We were fortunate to have international industry experts representing a variety of market-leading organisations joining members of the global Clifford Chance fintech team to offer their insights and practical guidance on navigating rapidly-evolving legal, regulatory and market developments across the sector including the latest on AI, digital bonds, tokenisation and global crypto. All sessions are now available to watch on demand.

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GLOBAL LEGAL AND REGULATORY UPDATES, INDUSTRY GUIDANCE AND PUBLICATIONS

International

• (18 Mar 2024) The Financial Stability Board (FSB) has reissued its 2016 Guidance on Arrangements to Support Operational Continuity in Resolution with a new supplementary note on the digitalisation of critical shared services as an addendum. The supplementary note does not create any new guidance or requirements. Rather, it specifies, for each section of the 2016 guidance, how authorities and firms should think about the continuity of critical shared services in resolution when those services are digital. | Press release
• (14 Mar 2024) Bank for International Settlements (BIS) working paper on DeFi leverage, which highlights the importance of considering user behaviour, market dynamics, and automated risk mitigation in the design and management of collateralised borrowing platforms with emerging tokenised assets.

Africa

Nigeria:         

• (15 Mar 2024) Securities and Exchange Commission (SEC) proposed major amendment to the rules on issuance, offering platforms and custody of digital assets

APAC

Australia:     

• (14 Mar 2024) Federal Court of Australia judgment in Australian Securities and Investments Commission (ASIC) v Finder Wallet Pty Ltd [2024] FCA 228, which concluded that Finder Wallet Pty Ltd did not provide unlicensed financial services in relation to cryptoasset related product Finder Earn. ASIC had argued that the Finder Earn product was a debenture because customers deposited money with Finder Wallet on the understanding that their money would be repaid, together with a return for allowing Finder Wallet to use their capital. The Court rejected this contention and found that the product was not a debenture within the meaning of s 9 of the Corporations Act 2001. ASIC has 28 days to lodge any application for appeal to the Full Federal Court. | ASIC press release

Hong Kong:

• (14 Mar 2024) The Hong Kong Monetary Authority (HKMA) has announced the launch of Phase 2 of the e-HKD Pilot Programme, with a view to further exploring innovative use cases for an e-HKD in Hong Kong | Press release

Indonesia:   

• (8 Mar 2024) The Indonesian Financial Services Authority (OJK) has issued new regulations (in Indonesian) to implement technological innovation in the financial sector, including in relation to digital financial assets and cryptoassets. The regulations are intended to create an integrated fintech ecosystem with an activity-based approach which aims to support innovation and ensure consumer protection and effective risk mitigation. | Press release (in Indonesian)

Europe

EU:  

• (19 Mar 2024) Regulation (EU) 2024/886 on instant credit transfers in euro, which has been published in the Official Journal and will enter into force on 8 April 2024. The regulation amends and modernises the Single Euro Payments Area (SEPA) Regulation on standard credit transfers in euro by adding to it specific provisions for instant credit transfers in euro.
• (18 Mar 2024) The European Central Bank (ECB) has announced that it is establishing seven new workstreams to develop the digital euro rulebook and has issued calls for candidates for each, inviting leading experts in payments infrastructure and architecture, technical specifications and scheme management to apply. | Press release
• (18 Mar 2024) ECB article on whether there is a digital divide in payments and understanding why cash remains important for so many
• (13 Mar 2024) The EU Commission has adopted three Delegated Regulations containing regulatory technical standards (RTS) supplementing the Digital Operational Resilience Act (DORA), specifying: 
  • the criteria for the classification of ICT-related incidents and cyber threats, setting out materiality thresholds and specifying the details of reports of major incidents;
  • the detailed content of the policy regarding contractual arrangements on the use of ICT services supporting critical or important functions provided by ICT third-party service providers; and
  • ICT risk management tools, methods, processes, and policies and the simplified ICT risk management framework.
• (13 Mar 2024) The EU Parliament has approved the Artificial Intelligence (AI) Act, which introduces harmonised rules to promote investment and innovation in AI, and to ensure that AI developed and used within the EU is trustworthy and subject to an appropriate legal framework. The Act is subject to a final lawyer-linguist check before formal adoption by Parliament (expected before the end of the legislature) and also needs to be formally approved by the EU Council before it can be published in the Official Journal. | Press release
• (13 Mar 2024) European Banking Authority (EBA) final draft regulatory technical standards (RTS) that set out the requirements, templates and procedures for handling complaints received by issuers of asset referenced tokens (ARTs), under the Markets in Cryptoassets Regulation (MiCA) | Press release

UK:

• (19 Mar 2024) Financial Conduct Authority (FCA) Business Plan 2024/25, which states that the FCA plans to deliver a market abuse regime for cryptoassets in the coming year
• (19 Mar 2024) UK Finance blog post on securing digital assets in the age of digital currencies

Middle East

UAE:

• (8 Mar 2024) Dubai International Financial Centre (DIFC) Digital Assets Law DIFC Law No. 2 of 2024, which came into effect on 8 March 2024 and sets out the legal characteristics of digital assets as a matter of property law, as well as how digital assets may be controlled, transferred and dealt with by interested parties. The DIFC has also enacted a new Law of Security and related amendments to select existing legislation to cater for the consequences of the new digital assets regime and revised security regime. | Press release