Sophisticated Investor Funds – Page 7 – Global Investment Law Watch

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.

EU Regulators launch review of SFDR compliance in the investment fund sector

Aug 04 2023

By: Shane Geraghty and Áine Ní Riain

On 6 July, the European Securities and Markets Authority (ESMA) announced it had launched a Common Supervisory Action (CSA) with National Competent Authorities (NCAs) on the integration of sustainability risks and on sustainability-related disclosures in the investment fund sector.

EU Commission announces much anticipated political agreement on AIFMD 2

Aug 03 2023

By: Shane Geraghty and Áine Ní Riain

On 20 July, the European Commission announced political agreement between the European Parliament and the European Council on proposed amendments to the EU’s Alternative Investment Fund Managers Directive (AIFMD). This follows the Commission’s proposal in the form of a draft directive amending AIFMD (AIFMD 2) issued in November 2021, protracted negotiations between the Commission, the Council and the European Parliament since 8 March of this year, and the issuance in June of a compromise text by the Council.

Australia: “Greenwashing” – Are the ACCC and ASIC Aligned?

Jul 26 2023

By Jim Bulling and Ben Kneebush

‘Greenwashing’ has been a priority for both the Australian Competition and Consumer Commission (ACCC) and the Australian Securities and Investments Commission (ASIC) for some time now.

ASIC’s approach to ‘greenwashing’ first emerged over a year ago with the publication of Information Sheet 271 (considered previously in our post), and was expanded with the release of Report 763 (considered previously in our post).

On 14 July 2023, the ACCC released its long-awaited draft guidance titled Environmental and Sustainability Claims – Draft Guidance for Business. The aim of this was to aid businesses in avoiding ‘greenwashing’ when making environmental or sustainability claims.

Australia: Mandatory Climate Disclosures Framework Takes Shape With Release of New Consultation Paper and ISSB Standards

Jun 30 2023

By: Jim Bulling and Kai Luck

On 27 June 2023, the Australian Treasury released a further consultation paper (consultation period open until 21 July 2023) on the introduction of a mandatory climate disclosure framework in Australia.

Under a phased-in approach, by 2027-28, all entities required to lodge financial reports will be subject to the disclosure framework. Larger entities fulfilling two of three criteria (consolidated revenue of AUD$500 million or more, consolidated gross assets of AUD$1 billion or more and 500 or more employees) will be required to lodge reports first, from 2024-25 with smaller entities which satisfy two of three criteria (consolidated revenue of AUD$50 million or more, consolidated gross assets of AUD$25 million or more, and 100 or more employees) having an extra two years to comply.

United States: SEC’s Stunning Enforcement Actions Against Binance and Coinbase

Jun 08 2023

By Rich Kerr, Eden Rohrer, and Max Black

In a stunning move, over the last two days, the Securities and Exchange Commission (SEC) has filed back-to-back enforcement actions against major crypto exchanges Binance (See here) and Coinbase (See here). This clearly indicates that the SEC is flexing its enforcement power over both international exchanges as well as those exchanges with a focus on the United States. Please visit the K&L Gates Fintech and Blockchain Law Watch to see commentary about these developments from our Digital Assets team.

People’s Republic of China: MOU of ETF Products Between China and Singapore Exchanges

Jun 01 2023

By Chloe Duan and Grace Ye

Shanghai Stock Exchange (SHSE) announced that it has entered into a memorandum of understanding (MOU) with Singapore Exchange (SGX) to establish a link for exchange-traded funds (ETFs) between two exchanges. SHSE and SGX are also aiming to jointly develop more ETF products available to investors on both markets via the link.

Australia: Proposed Reforms to the Anti-Money Laundering and Counter-Terrorism Financing Regime

May 29 2023

By Daniel Knight and Grace Hall

The Australian Government has committed to reforming Australia’s AML/CTF regime, with proposed reforms aimed to strengthen and modernise the framework.

In April 2023, the Attorney-General released the first of two consultation papers outlining the proposed reforms to the regime. Subsequently, as part of the 2023-24 Federal Budget, the Government announced that it will provide $14.3 million in funding over the next four years to support policy and legislative reforms to the AML/CTF regime.

Europe: ESMA Advocates More Specific Restrictions on the Costs Fund Managers May Pass on to Investors

By Áine Ní Riain and Gayle Bowen

The European Securities and Markets Authority (ESMA) has suggested that the European Commission should clarify the costs that UCITS management companies and AIFMs may pass on to investors under existing rules that prohibit “undue costs”. Costs for this purpose include fees payable to the manager and other fund service providers and all other one-off, recurring or transaction-related costs. The purpose of the proposed clarification would be to provide for better convergence between the approaches of different EU member states, and a better basis for national regulators to take supervisory and enforcement actions in this area.

United States: New Conference, More Rulemaking?

May 22 2023

At the Conference On Emerging Trends In Asset Management sponsored by the US Securities and Exchange Commission (SEC) and held 19 May 2023, Chair Gary Gensler, and Director of the SEC’s Division of Investment Management, William Birdthistle, called for greater discourse with industry participants and highlighted the strengths of recent rulemaking activities of the SEC.

Mr. Birdthistle kicked off the conference by referring to funds and investment advisers as “critical agents” in the investment management industry and in advancing the SEC’s mission. He also acknowledged the need for the SEC and its staff to be open to different opinions. He did not, however, indicate how such different views have been—or would be—addressed in the rulemaking process or otherwise.

Category:Sophisticated Investor Funds