Chancellor Jeremy Hunt has unveiled a package of 30 reforms to financial services regulation.
The package, known as the Edinburgh Reforms, includes a plan to “lift and shift” regulatory obligations towards the government and the regulators, enhancing their power to shape future policy and repeal EU-derived laws under the Financial Services and Markets Bill.
The government will split retained EU law into tranches, with Solvency II covered in the first and rules on packaged retail and insurance-based investment products (PRIIPS) in the second. Ministers expect “significant progress” on both tranches by the end of next year.
The UK PRIIPs regime will be replaced by an alternative retail disclosure framework, with the Financial Conduct Authority (FCA) to decide the format and presentation requirements for disclosure.
The government will also release an updated Green Finance Strategy in early 2023 and consult in the first quarter on bringing environmental, social and governance ratings providers into the regulatory perimeter.
Under new remit letters for the Prudential Regulation Committee and the FCA, both regulators will receive a new secondary objective under the Financial Services and Markets Bill: to promote the UK economy’s international competitiveness and growth, particularly in financial services.
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