Application of the definition of “sustainable investment" in Article 2(17) SFDR to investments in funding instruments that do not specify the use of proceeds, such as the general equity or debt of an investee company
Interpretation of “investment in an economic activity that contributes to an environmental objective" or “investment in an economic activity that contributes to a social objective" in Article 2(17) SFDR
Article 9(3) SFDR, carbon emissions reductions and other benchmark questions
500 employee PAI threshold
Periodic disclosure frequency for portfolio management services.
The Russian war on Ukraine, against a backdrop of already-increasing inflation, has profoundly impacted the risk environment of EU financial markets, with overall risks to ESMA’s remit remaining at its highest level
Contagion and operational risks are now considered very high, like liquidity and market risks. In the first half of 2022 financial markets saw faltering recoveries, increasing volatility and likelihood of market corrections
The Russian war drove a commodities-supply shock which added to pre-existing pandemic-related inflation pressures. Monetary policy tightening also gathered pace globally, with markets adjusting to the end of the low interest rates period
Separately, crypto-markets saw large falls in value and the collapse of an algorithmic stablecoin, highlighting again the very high-risk nature of the sector.
ESAs report on risks and vulnerabilities in the EU financial system - Autumn 2022
The ESAs issued their Autumn 2022 joint risk report, highlighting that the deteriorating economic outlook, high inflation and rising energy prices have increased vulnerabilities across the financial sectors. The ESAs advise national supervisors, financial institutions and market participants to prepare for challenges ahead.
Wolfsberg Group guidance on requests for information best practice
The Wolfsberg Group published best practice guidance on requests for information (RFI),which are used as part of an anti-money laundering transaction monitoring process.
The guidance focuses on RFIs initiated as a result of transaction monitoring and is not intended to address inquiries issued relating to transactions blocked or rejected as a result of sanctions screening or payment transparency events.
An RFI is used when a provider of payment services (a correspondent) seeks to understand the background of a transaction that has been processed through an account or relationship in its books and is directed at the customer entity that sent the payment instruction to the correspondent. The RFI process is seen as a vital source of information that allows a correspondent to see how a respondent's anti-money laundering programme works.
The Wolfsberg Group is an association of leading international financial institutions that aims to develop frameworks and guidance for the management of financial crime risks, particularly with respect to know your customer, anti-money laundering and counter terrorist financing policies.
EBA AML/CFT newsletter
The European Banking Authority (EBA) issued its newsletter which covered -
Guidelines on the role and responsibilities of the AML/CFT compliance officer (these apply from 1 December 2022)
Update on EuReCA (the EBA's new AML/CTF database)
Joint ESAs Report on the withdrawal of authorisation for serious breaches of AML/CFT rules
Report on the functioning of AML/CFT colleges.
In terms of future developments, the newsletter flags a public consultation, later in 2022, on guidelines on effective ML/TF risk management and access to financial services (Anti-derisking Guidelines).