Featured Product

    AMF France Proposes Minimum Environmental Criteria Under SFDR

    AMF France, the financial market regulator of France, proposed, to include into European Law, the minimum environmental requirements that financial products must meet to be classified in context of Article 8 or Article 9 under the Sustainable Finance Disclosure Regulation (SFDR). Additionally, the French Prudential Supervisory Authority (ACPR) published reporting updates for the banking sector.

    Proposal on Minimum Environmental Criteria Under SFDR

    In its review, AMF France has proposed to introduce the minimum criteria concerning environmental impact for financial products in the European Law categorized under Article 8 or Article 9 of the SFDR. The SFDR regulation, adopted in 2019, was designed by the European Union co-legislators and the Commission as an Environmental, Social and Governance (ESG) transparency regime for financial entities and products. The SFDR regulation requires financial market participants to publish information on their sustainability communications and practices, however it does not impose minimum requirements or define the concept of sustainable investment. In order to avoid ambiguity and to better meet the expectations of savers, AMF France draws on existing market practices and regulations and sets out following recommendations which could be implemented very quickly in European Law and would be a useful addition to the current regulatory framework:

    • Minimum environmental criteria should be established for the classification of products as Article 9 or Article 8. Compliance with these criteria would be subject to national supervision. The criteria for Article 9 should continue to be more stringent than those for Article 8.
    • A minimum proportion of portfolio assets for Article 9 funds should consist of investments aligned with the Taxonomy. This percentage could increase over time as the European economy advances towards sustainability.
    • Financial market participants that manage Article 8 and 9 funds should adopt a binding ESG approach in their investment decision-making process. The EU framework for minimum criteria should identify a set of acceptable ESG approaches that can be implemented by financial players.
    • Article 9 funds should exclude investments in fossil fuel activities that are not aligned with the European Taxonomy. Investment in such activities would be possible for Article 8 products provided that they meet strict conditions that ensure that these activities are engaged in an orderly transition.

    In a more exploratory approach, AMF France also proposes to introduce the concept of transition and engagement policies. The regulator has identified possible avenues for a quantitative definition of assets in transition. With this, AMF France aims to make a constructive contribution to a new phase of European regulation on sustainable finance.

    Reporting Update for Banks

    ACPR modified the Functional Business Cards of its information system to integrate the developments from the Decree 03/2023. The modified version incorporates changes related to the repeal of the EBA/GL/2020/07 guidelines on COVID-19 reporting by the European Banking Authority (EBA), and the implementation of instruction 2022-I-15 relating to the declaration of additional information applicable to class 2 and 3 investment firms and investment holding companies relating to FINREP statements. With regard to REMUNERATION collection, a dedicated communication will be published, and the Functional Business Cards will be updated in the coming weeks.

     

    Related Link (in French and English): Update on Functional Business Cards

    Keywords: Europe, France, Banking, ESG, Climate Change Risk, Sustainable Finance, SFDR, Reporting, Remuneration, ACPR, AMF France

    Featured Experts
    Related Articles
    News

    EBA Finalizes Templates for One-Off Climate Risk Scenario Analysis

    The European Banking Authority (EBA) has published the final templates, and the associated guidance, for collecting climate-related data for the one-off Fit-for-55 climate risk scenario analysis.

    November 28, 2023 WebPage Regulatory News
    News

    EBA Mulls Inclusion of Environmental & Social Risks to Pillar 1 Rules

    The European Banking Authority (EBA) recently published a report that recommends enhancements to the Pillar 1 framework, under the prudential rules, to capture environmental and social risks.

    October 31, 2023 WebPage Regulatory News
    News

    BCBS Consults on Disclosure of Crypto-Asset Exposures of Banks

    As a follow on from its prudential standard on the treatment of crypto-asset exposures, the Basel Committee on Banking Supervision (BCBS) proposed disclosure requirements for crypto-asset exposures of banks.

    October 19, 2023 WebPage Regulatory News
    News

    BCBS and EBA Publish Results of Basel III Monitoring Exercise

    The Basel Committee on Banking Supervision (BCBS) and the European Banking Authority (EBA) have published results of the Basel III monitoring exercise.

    October 18, 2023 WebPage Regulatory News
    News

    PRA Updates Timeline for Final Basel III Rules, Issues Other Updates

    The Prudential Regulation Authority (PRA) recently issued a few regulatory updates for banks, with the updated Basel implementation timelines being the key among them.

    October 18, 2023 WebPage Regulatory News
    News

    US Treasury Sets Out Principles for Net-Zero Financing

    The U.S. Department of the Treasury has recently set out the principles for net-zero financing and investment.

    October 17, 2023 WebPage Regulatory News
    News

    EC Launches Survey on G7 Principles on Generative AI

    The European Commission (EC) launched a stakeholder survey on the draft International Guiding Principles for organizations developing advanced artificial intelligence (AI) systems.

    October 14, 2023 WebPage Regulatory News
    News

    ISSB Sustainability Standards Expected to Become Global Baseline

    The finalization of the two sustainability disclosure standards—IFRS S1 and IFRS S2—is expected to be a significant step forward in the harmonization of sustainability disclosures worldwide.

    September 18, 2023 WebPage Regulatory News
    News

    IOSCO, BIS, and FSB to Intensify Focus on Decentralized Finance

    Decentralized finance (DeFi) is expected to increase in prominence, finding traction in use cases such as lending, trading, and investing, without the intermediation of traditional financial institutions.

    September 18, 2023 WebPage Regulatory News
    News

    BCBS Assesses NSFR and Large Exposures Rules in US

    The Basel Committee on Banking Supervision (BCBS) published reports that assessed the overall implementation of the net stable funding ratio (NSFR) and the large exposures rules in the U.S.

    September 14, 2023 WebPage Regulatory News
    RESULTS 1 - 10 OF 8938