Covid19 & financial regulatory filings

On 17 March, the FCA published guidance to FCA regulated firms about how to handle a range of items in the Covid19 outbreak. The guidance webpage is being updated regularly, but as things stand the FCA's guidance seems broadly reasonable to me. 

Given my past experiences, of particular interest to me is the FCA's position on market trading and reporting, and I some of my thoughts on the topic have been reported on Ignites. 

The FCA exhorts firms to continue to record phone calls. The greatest impact here to be felt by firms and institutions who deal with a calls from and to retail customers/investors. But given that they will know they do a lot of business over the phone, by and large those firms should have sufficiently sophisticated systems which allow such calls to be recorded remotely. Where that is not possible, firms should tell personnel to keep contemporaneous written notes of all calls, ideally electronically. Again, most firms should have systems and controls in place to handle that too. As such, I would expect the firms which have difficulty with adapting to a reduced phone taping regime would be of two types: (i) firms which are improperly prepared for BCP scenarios – which means the issue they have with phone taping is a symptom and not a cause; or (ii) firms which are properly prepared but who suffer a force majeure-type failure somewhere in their systems or processes – which is not something you can necessarily avoid. In scenario (ii), the overarching requirements will be to act reasonably, put things right as soon as possible and keep lines of communication with the regulator open.

On regulatory reporting, firms may be familiar with an inability to submit regulatory reports from time to time (for example when AIFMD Annex IV reporting first came in, GABRIEL and the xml template had some teething issues and many filings were delayed past the deadline). In these case, firms should at least work on a "best efforts" basis. So long as they can show they have all they need to make a timely submission, and that the submission has been delayed for reasons beyond their control, the regulator is usually quite understanding (in my experience). Here, though, the key is that even if you can’t make the filing, the FCA will expect you'll have all the information you need and done all you can to be in a position that you could have made the filing in a timely manner. In other words, if Connect or GABRIEL go down, you might not be able submit a filing, but you should have prepared it and saved the files on your system ahead of the filing deadline in any event.