Shearman & Sterling LLP | FinReg | UK Government Announces Boost to UK FinTech and Financial Services
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  • UK Government Announces Boost to UK FinTech and Financial Services

    The U.K. Government has announced plans to boost the U.K.'s fintech and financial services sectors. Chancellor of the Exchequer Rishi Sunak outlined the plans at U.K. FinTech Week, describing the government's vision for a greener and more technologically advanced financial services sector. The Government's announcement builds on the recommendations in the recent Kalifa Review of U.K. Fintech and Lord Hill's Review of the U.K. Listing Regime.  Key elements of the proposals include: 
    • Supporting growth of fintech firms

    The U.K. Financial Conduct Authority will implement its "scale box" initiative, to enable fintech start-ups to test new propositions, and will launch the second phase of its Digital Sandbox, which enables firms to test projects tackling sustainability and climate-related challenges. A new Centre for Finance, Innovation and Technology will also be established to identify and address challenges to the fintech sector.
    The Department for International Trade has announced plans to support the U.K. as a global fintech hub. The DIT is creating a new Export Academy to provide free advice to selected high-potential firms on legal, tax, regulatory, accounting and market entry issues. It will also introduce a FinTech Champions scheme that will harness the experience of successful firms to promote expansion of the U.K.'s place as a global fintech hub and help up-and-coming businesses scale up and up-skill.
    • Digital finance

    The Bank of England and HM Treasury are launching a Taskforce to explore a possible U.K. central bank digital currency. They will also work together with the FCA to establish a new sandbox for firms planning to develop technologies to improve financial market infrastructure.
    • Listing rules reforms

    Following the publication of Lord Hill's report on the U.K. Listings Review, which proposes reforms to the U.K. listings regime to make it more attractive to companies, the government plans to consult on changes to the prospectus regime. This will include exploring how companies could more easily provide forward-looking financial information, which is particularly relevant for technology firms with high-growth potential. The government will also convene a group of experts to consider improvements to the efficiency of rights issues. There will be a consultation on broader reforms to the U.K.'s. wider capital markets regime in summer 2021, which will consider proposals such as abolishing the share trading obligation and double volume cap.

    The Chancellor has also published a separate written statement, setting out his response to Lord Hill's report.

    View HM Treasury's announcement of its plans.

    View the Department for International Trade's announcement

    View details of the BoE and HMT's Taskforce on a U.K. CBDC.

    View details of the Chancellor's response to Lord Hill's report.

    View details of the Kalifa Review.

    View details of the U.K. Listings Review.

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    TOPICS: FinTechSecurities