The European Council adopted a set of conclusions on the role of regulatory sandboxes and experimentation clauses in an innovation-friendly, future-proof, sustainable, and resilient EU regulatory framework. The Council calls on EC calls on EC to present the findings of this evaluation in the first half of 2021, followed by practical recommendations for the possible future use of regulatory sandboxes and experimentation clauses at EU level in the second half of 2021.
Regulatory sandboxes are defined as concrete frameworks which, by providing a structured context for experimentation, enable, where appropriate in a real-world environment, the testing of innovative technologies, products, services, or approaches for a limited time and in a limited part of a sector or area under regulatory supervision while ensuring that appropriate safeguards are in place. Experimentation clauses, often the legal basis for regulatory sandboxes, are defined as legal provisions that enable the authorities tasked with implementing and enforcing the legislation to exercise on a case-by-case basis a degree of flexibility in relation to testing innovative technologies, products, services or approaches. In these conclusions, the Council affirms that regulatory sandboxes can offer significant opportunities, particularly to innovate and grow for all businesses, especially small and medium enterprises, including micro-enterprises, as well as startups, in industry, services, and other sectors. The Council, therefore, encourages EC to continue considering the use of experimentation clauses on a case-by-case basis when drafting and reviewing legislation. It also encourages EC to evaluate the use of experimentation clauses in ex-post evaluations and fitness checks on the basis of an exchange of information with member states.
Keywords: Europe, EU, Banking, Insurance, Securities, Regulatory Sandbox, Experimentation Clauses, Fintech, Regtech, Suptech, European Council
Previous ArticleHKMA Revises Submission Timelines for Several Existing Returns
The Hong Kong Monetary Authority (HKMA) revised the Supervisory Policy Manual module CG-5 that sets out guidelines on a sound remuneration system for authorized institutions.
The European Banking Authority (EBA) published the final guidelines on the monitoring of the threshold and other procedural aspects on the establishment of intermediate parent undertakings in European Union (EU), as laid down in the Capital Requirements Directive (CRD).
In a recent Market Notice, the Bank of England (BoE) confirmed that green gilts will have equivalent eligibility to existing gilts in its market operations.
The Financial Conduct Authority (FCA) published the policy statement PS21/9 on implementation of the Investment Firms Prudential Regime.
The European Banking Authority (EBA) proposed regulatory technical standards that set out criteria for identifying shadow banking entities for the purpose of reporting large exposures.
The Board of the International Organization of Securities Commissions (IOSCO) proposed a set of recommendations on the environmental, social, and governance (ESG) ratings and data providers.
The European Securities and Markets Authority (ESMA) published recommendations from the Working Group on Euro Risk-Free Rates (RFR) on the switch to risk-free rates in the interdealer market.
The European Central Bank (ECB) published a paper as well as an article in the July Macroprudential Bulletin, both of which offer insights on the assessment of the impact of Basel III finalization package on the euro area.
The International Swaps and Derivatives Association (ISDA) published a paper that explores the impact of the Fundamental Review of the Trading Book (FRTB) on the trading of carbon certificates.
The Prudential Regulation Authority (PRA) published the remuneration policy self-assessment templates and tables on strengthening accountability.