Updated Regulatory Requirements In Light Of COVID-19

In response to COVID-19, regulators have recognised the many operational challenges caused by current restrictions and have issued a number of regulatory flexibilities for investment firms, funds and fund service providers.

In April, the Central Bank of Ireland (the “Central Bank”) published a market update on new consultations and guidelines and how regulated firms should act and respond to the temporary measures imposed at this time. Here is a high level overview of these expectations, how they must be adhered to and how GECKO Governance can help you meet your compliance obligations.

Extension to Regulatory Filings:

Extensions have been granted by the Central Bank to relevant firms with regards to the submission of various file types and their applicable periods. Click here to view the table published on the Central Bank’s website, outlining how firms should submit the relevant regulatory file in correspondence with their designated timeframe also bearing in mind the extension granted also varies depending on the filing in question. With regard to all other reports and files which have not been outlined in the table published, these are expected to be filed to the Central Bank within the existing reporting timeframes.

Client Asset and Investor Money Requirements

In a situation where an investment firm or fund service provider cannot meet the filing deadlines applicable to assurance reports as a result of the pandemic, the Central Bank has agreed to provide a two month extension to the date on which the filing should have been made for any report falling due from April 2020 to July 2020. Any firms wishing to avail of this extension should contact the Central Bank immediately.

Updates to Central Bank Regulatory Policy Frameworks

Securities markets, investment management activities and investment firms all undergo regular assessments of the domestic regulatory policy framework carried out by the Central Bank. Recognising the rapidly evolving nature of the situation we are faced with, the Central Bank will delay updates to its domestic regulatory policy frameworks and also delay the publication of its feedback statement arising from Consultation Paper 130 (CP130), with regards to the treatment, Correction and Redress of Errors in Investment Funds.

Risk Mitigation Programmes for Investment Firms and Fund Service Providers

The Central Bank expects investment firms and fund service providers in a position to meet the existing RMP implementation dates, to continue to do so. Effective engagement is required between the investment firm or fund service provider and the Central Bank when submitting documentation to the regulator within a given timeframe detailed in a risk mitigation programme (“RMP”). The entity should notify the Central Bank supervisor if they are unable to meet the deadline, with reasoning, whereby the Central Bank will then assess whether such deadlines should be extended on a case-by-case basis.

The Central Bank is not the only regulator to issue flexibility publications. In the last six weeks alone, there have been a total of 12 non-COVID-19 publications issued by EU regulators as they continue to progress their agendas and supervisory priorities. At the beginning of March, ESMA issued the official translations of its final guidelines on stress testing and reporting by Money Market Funds (MMFs). During this time there is an understandable focus, reporting and disclosure being at the top of their regulatory agenda by regulators and firms, on governance and controls, the fair pricing of assets and fund shares/units, and liquidity management in open-ended funds.

GECKO’s 3 Click Concept

COVID-19 has certainly highlighted the need for technological solutions both now and in the future as firms have to adapt and respond to altered working conditions such as remote working and travel restrictions.

Having carried out a recent survey on the ‘Needs of the Technological Financial Services Industry’ we know the greatest pain points for financial institutions are:

• Reporting;
• Thematic Inspections;
• And Overall Management and Oversight of Regulatory Compliance.

GECKO can help you address all of the above and clearly exemplify the steps taken to manage and adhere to obligations. The GECKO system ensures that you track and monitor continual changes like these outlined above and help you avoid landing into a ‘fine mess’ with regulators. The image below illustrates GECKO’s 3 Click Concept:

With just three clicks of a button, GECKO can save staff time and energy trawling regulator websites, PDFs and rejigging cells and columns to fit. Our document repository, real-time stamped audit trail and time-saving client on boarding and AML features enables users to simplify any process.

Get in touch with us if you urgently need to streamline your governance processes, store information and efficiently track and monitor your regulatory requirements and work processes. Our team has many years of extensive risk and compliance experience in-house, which gives us a unique perspective.

The GECKO system and team are readily available to assist you in assimilating the provisional requirements and reporting dates issued by the Central Bank. Please do not hesitate to reach out to us.