Investment management update - March 2022

24 March 2022

Welcome to the March 2022 edition of our investment management update. This publication has been tailored to highlight topical news, cases and changes in the law impacting the investment management sector.

This month’s edition includes the following updates:

  • HM Treasury’s response to its review of the UK’s fund regime;
  • ESMA’s sustainable finance roadmap for 2022-24, and an initial consultation on ESG scores and ratings providers; and
  • ESMA’s briefing on the use of tied agency marketing models, indicating regulatory action for non-EU firms marketing to investors in the EU.


  • The Economic Secretary, John Glen MP, gave a speech outlining the UK’s proposed reforms to the on-shored Solvency II HM Treasury’s aim is to streamline and better adapt the EU’s regulations to the UK’s insurance sector. A consultation is due to begin in April 2022.
  • HM Treasury has published its response to its 2021 consultation on the Review of the UK Funds Regime. The report summarises the feedback received in response to the Call for Input and details the Government’s next steps. There will be further work on simplifying the tax regime for funds, developing a new unauthorised contractual scheme, and considering means to help firms with the fund authorisation process.
  • The FCA released an update on LIBOR transition, summarising developments so far and refocusing the Working Group on Sterling Risk-Free Reference Rates on new objectives to finalise transition.
  • The FCA has provided updated guidance to firms on how to submit a change in control notification. A backlog in notifications has resulted in a delay of around two months between the submission of a notification and its allocation to an FCA case officer. The FCA’s webpage details how firms should submit information to ensure the process is as timely as possible and warns that transacting without an FCA decision is a criminal offence.


  • ESMA has published an ESG timeline detailing the publication and implementation dates for sustainable finance regulations, including the Sustainable Finance Disclosure Regulation (SFDR) and the Taxonomy Regulation.
  • ESMA has also published a sustainable finance roadmap, detailing its planned initiatives between 2022 and 2024. These actions include supervisory reviews to tackle greenwashing, further guidance on the SFDR including minimum standards for Article 8 funds, and the creation of pan-EU ESG product and benchmark labels.
  • ESMA has published its Opinion on reforms to the Money Market Funds (MMF) Regulation. The recommendations are in response to perceived deficiencies in MMFs that were revealed during the pandemic in March 2020. Global regulators are also coordinating reforms between different jurisdictions. ESMA proposals include removing amortised costs for LVNAVs, decoupling regulatory thresholds from redemption fees, gates, and suspensions, and mandating the use of at least one liquidity risk management tool. The European Commission will consider the recommendations before publishing its proposals later in 2022.
  • ESMA launched a call for evidence on ESG ratings providers. The questionnaire is directed to ESG ratings providers, the users of ESG ratings, and the entities covered by ESG ratings. The survey had a short timeframe and closed on 11 March 2022.
  • The European Commission has launched a consultation on potential improvements to suitability and appropriateness assessments under MiFID II. The consultation forms part of the EU’s Retail Investment Strategy, which will separately look at issues such as whether to ban inducements. The consultation closed on 21 March 2021.
  • The ESAs have published their joint response to the European Commission’s call for advice on digital finance. The response considers the need for improved consumer protections to address the increasing dependence on digital platforms and improving the regulation and supervision of mixed activity groups.
  • ESMA published a supervisory briefing on firms that use tied agents for the purposes of marketing under MiFID II. Regulators’ concern is that UK firms might be circumventing the rules after Brexit. We analysed the briefing in depth here.


  • The Financial Stability Board has published a report on developments and risks in crypto currencies. The report concludes that the growth in stablecoins, unbacked crypto currencies and decentralised finance could pose risks to global financial stability.