Global Investment Law Watch – Page 9 – Exploring the legal and regulatory issues affecting the worldwide investment community.

Europe: Commission Launches SFDR Consultations

Sep 19 2023

On 14 September, the European Commission launched both a public consultation and a targeted consultation on the implementation of the Sustainable Finance Disclosure Regulation (SFDR).

The Commission aims to understand how the SFDR has been implemented since its initial application in March 2021, as well as to gain an understanding of its potential deficiencies, and to explore potential improvements of the European framework for sustainable finance. These consultations form part of the Commission’s comprehensive assessment of the SFDR framework that was first announced by Commissioner Mairéad McGuinness in December 2022. While the public consultation is addressed to a wide range of individuals and organisations with a general knowledge of the SFDR, the targeted consultation is aimed at financial market participants (FMPs), investors, NGOs, public authorities, regulators, and others that are either subject to the provisions of the SFDR or otherwise have an in-depth knowledge or experience in the area of sustainable finance disclosures.

Spot Bitcoin ETFs – Coming to an Exchange Near You (Maybe)!

Aug 29 2023

By: Rich Kerr, Peter Shea, Andrew Hinkes, and Brian Doyle-Wenger

On 29 August 2023, the United States Court of Appeals for the District of Columbia Circuit (Court) issued a decision siding with Grayscale Investments, LLC (Grayscale) and vacated the U.S. Securities and Exchange Commission’s (SEC) rejection of the NYSE Arca’s (NYSE) request for approval of a listing rule that would permit it to list shares of the Grayscale Bitcoin Trust (GBT) for trading.

Brokers Beware – The Massachusetts Fiduciary Rule is Here to Stay

Aug 28 2023

On 25 August 2023, the Massachusetts Supreme Judicial Court reversed a Massachusetts Superior Court ruling and denied Robinhood Financial LLC’s attempt to block the implementation of Massachusetts’s unique fiduciary duty rule, adopted in February 2020 within weeks of the final adoption of the SEC’s Regulation Best Interest, which imposes the duties of care and loyalty on broker-dealers (Fiduciary Rule). A summary of the Fiduciary Rule is available here. Robinhood’s action to overturn the Rule was brought after the Commonwealth of Massachusetts brought an administrative action accusing Robinhood of violating Fiduciary Rule with its video game-like design and marketing tactics.

People’s Republic of China: State Council Issued New Policy for Attracting Foreign Investment

Aug 28 2023

By: Chloe Duan and Grace Ye

On 13 August 2023, the central government of China issued Opinions of the State Council on Further Optimizing the Environment for Foreign Investment and Increasing Efforts to Attract Foreign Investment (New Policy). The New Policy covers broad range of aspects in relation to incentivizing foreign investors to make investments in China.

Australia: The Reserve Bank’s Central Bank Digital Currency Trial

Aug 28 2023

By Daniel Knight and Kithmin Ranamukhaarachchi

Last week the Reserve Bank of Australia (RBA) released its report on the CBDC research project which it conducted with the Digital Finance Cooperative Research Centre (see here). The project entailed the trial of relevant use cases in a live transactional environment, making use of CBDC issued by the RBA that carries a real legal claim on the RBA. The trial, which took place between March and July this year, set out to understand the value of a CBDC to the Australia economy and payments systems.

The SEC’s New Rules for Private Fund Advisers: A Dose of Transparency for the Private Markets

Aug 24 2023

By: Ken Holston, TJ Bright, Pablo Man, Matthew Mangan, Chris Phillips-Hart, Annabelle North

On August 23, 2023, the SEC adopted sweeping new rules that will impose substantial regulation on the management and operation of private funds by investment advisers. The rules appear to be somewhat less burdensome than the rules originally proposed in February 2022.

ICYMI: Integrity Council Launches Global Benchmark and Core Carbon Principles for Voluntary Carbon Markets

Aug 18 2023

By: Cheryl Isaac and Christine Mikhael

In case you missed it: late last month, the Integrity Council for the Voluntary Carbon Market (“ICVCM”) launched its Core Carbon Principles (CCPs) and Program-level Assessment Framework (Framework). With the publication of these new standards (developed with the input of hundreds of stakeholders in the voluntary carbon markets), we now have a set of fundamental principles for high-quality credits that create a verifiable climate impact, and a framework for determining whether carbon credit programs are eligible to label themselves as being in compliance with the CCPs.

EUROPE: ELTIFs to become standalone product in Ireland

Aug 17 2023

By Shane Geraghty and Gayle Bowen

On the 16 August 2023, following positive engagement with the Central Bank of Ireland (the “CBI”), Irish Funds (the Irish funds industry representative body) announced that the CBI had indicated that it intends to develop a standalone European Long Term Investment Fund (ELTIF) chapter to be included in the CBI’s Alternative Investment Fund (‘AIF’) Rulebook. This will result in ELTIFs becoming a standalone regulated product in Ireland and facilitate the authorisation by the CBI of ELTIFs under Regulation (EU) 2015/760 and its upcoming amending regulation, Regulation (EU) 2023/606 (the ‘ELTIF Regulations’).

Australia: Consultation Opens for Proposed Review of Managed Investment Schemes

Aug 14 2023

By Kane Barnett and Bernard Sia

The Australian Government has released the long awaited consultation paper on the review of the regulatory framework for managed investment schemes. The consultation paper comes on the back of the Government’s announcement of the review earlier in March this year (see our previous update). The current regulatory regime for managed investment schemes commenced in 1998.

United States: SEC Charges 11 Firms with Record Retention Violations

Aug 11 2023

By: Neil Smith , Hayley Trahan Liptak and Peter Shanley

For over twenty months, the U.S. Securities and Exchange Commission (SEC) has steadily announced settled orders against broker-dealers and investment advisers for failure to retain business-related communication. On 8 August 2023, the SEC released another round of settled orders with 11 firms for violation of Exchange Act Rule 17a-4 for failing to retain off-channel business-related communication. One dually registered broker-dealer and investment adviser was also charged with violating recordkeeping provisions of the Investment Advisers Act of 1940. The content of the orders, and the firms involved, show the SEC’s attention may be shifting from wide-spread violations at large institutions to more limited compliance failures at firms of differing sizes. The assessed penalties, although still considerable, are consistent with this shift.