Publication
Horizon Scanning: Investigations and Enforcement
In this horizon scan, we focus on key developments affecting companies operating in the UK, including in light of the recent change in UK government.
Global | Publication | July 29, 2016
Welcome to Essential Corporate News, our weekly news service covering the latest developments in the UK corporate world.
On July 26, 2016 the Executive Remuneration Working Group, established by the Investment Association in September 2015 to review pay structures in UK listed companies, issued its Final Report. The Working Group published its Interim Report in April 2016 and consulted widely throughout May and June 2016 with a wide range of stakeholders. The Working Group’s core recommendation in the Final Report is that companies be given the flexibility to select the remuneration structure that is most appropriate for their business, rather than focusing solely on the currently dominant Long Term Incentive Plan (LTIP) pay structure. The Working Group has set out a framework of structures to illustrate what this flexibility might look like in practice. The framework of structures should not be seen as an exhaustive or approved list of alternatives, but as examples designed to explore the practicalities of a more flexible system.
The Report contains the following ten recommendations aimed at rebuilding trust in executive pay structures in the UK:
(Executive Remuneration Working Group, Final Report, 26.07.16)
The Financial Conduct Authority (FCA) has updated its statement (which was initially published in May 2016) on closed periods and preliminary results under the Market Abuse Regulation (MAR) to refer market participants to the European Securities and Markets Authority’s (ESMA) Q&A on MAR which was recently updated to include a question on this matter. The FCA notes that the approach taken to this matter in ESMA’s Q&A on MAR is similar to the approach the FCA had taken in its May statement.
(FCA, Closed periods and preliminary results under MAR, 20.07.16)
On July 26, 2016 the European Securities and Markets Authority (ESMA) published its final report on the draft implementing technical standards (ITS) regarding the procedures and forms for exchanging information with ESMA as referred to in Article 33 of the Market Abuse Regulation (MAR).
Article 33(5) of MAR requires ESMA to develop draft ITS to determine the procedures and forms to be used for the following two types of submission of information:
ESMA has submitted the final draft ITS for endorsement to the European Commission.
On July 27, 2016 the European Commission published Commission Implementing Decision (EU) 2016/1223 amending Decision 2011/30/EU on the equivalence of certain third country public oversight, quality assurance, investigation and penalty systems for auditors and audit entities and a transitional period for audit activities of certain third country auditors and audit entities in the EU in the Official Journal.
Following assessment, it was determined that Mauritius, New Zealand and Turkey have public oversight, quality assurance, investigation and penalty systems for auditors and audit entities that meet requirements equivalent to those set out in Articles 29, 30 and 32 of (the Statutory Audit Directive (Directive 2006/43/EC), and therefore these countries’ systems are considered equivalent to those for auditors and audit firms of the Member States.
In addition, the transitional period granted by Decision 2011/30/EU (as amended by Commission implementing decision of 13 June 2013) in respect of auditors and audit entities in Bermuda, Cayman Islands, Egypt and Russia has been extended to apply to financial years starting during the period of July 2, 2010 to July 31, 2018.
On July 18, 2016 the Office of Tax Simplification (OTS) published two discussion papers aimed at small companies.
The papers discuss the following:
For both papers, the deadline for comments is September 30, 2016, but the OTS asks that comments are ideally submitted by September 12, 2016. The OTS plans to publish its conclusions in October 2016.
(OTS, Sole Enterprise with Protected Assets: A discussion paper, 18.07.16)
On July 25, 2016 the joint working party of The Law Society Company Law Committee and The City of London Law Society (CLLS) Company Law and Financial Law Committees published a guidance note on the execution of documents using an electronic signature. The note has been approved by Leading Counsel.
The Guidance sets out the legislative framework for electronic signatures and the principles for determining whether certain types of documents that have been signed with an electronic signature have been validly executed. The types of documents considered are simple contracts, documents subject to a statutory requirement to be in writing, signed or under hand, deeds and minutes and resolutions.
The Guidance also addresses:
The Guidance is limited in scope to commercial contracts entered into (and certain other documents signed) in a business context, rather than those to which consumers or other individuals outside a business context are a party.
(Law Society/CLLS, Note on the Execution of a Document Using an Electronic Signature, 25.07.16)
Publication
In this horizon scan, we focus on key developments affecting companies operating in the UK, including in light of the recent change in UK government.
Publication
On 3 September 2024, the ECJ delivered its judgment in Illumina’s appeal against the General Court’s (GC) judgment confirming the European Commission’s (EC) powers to review concentrations under the EU Merger Regulation (EUMR) in circumstances where no Member State has jurisdiction under national law.
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