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Welcome to the weekly Financial Services highlights from the Lexis®PSL Financial Services team for the week ending 29 June 2017.
On 22 June 2017, EU27 leaders endorsed the procedure for deciding on the relocation of the EU agencies currently located in the UK—including the European Medicines Agency and the European Banking Authority (EBA). The general principles are based on a ‘fair and transparent’ decision-making process with an organised call for offers, based on specified objective criteria such accessibility of the location and adequate education facilities for the children of agency staff. The rules regarding offers to host and the information to be included are also set out. The deadline for Member States to submit offers to host one or both agencies is 31 July 2017.
On 22 June 2017, the Financial Conduct Authority (FCA) published its monthly email to all regulated firms. The round-up highlights the FCA’s new guide to the foundations of good cyber security, and includes findings on the recent thematic review of the general insurance sector, in which the FCA found significant shortcomings, including examples of mis-selling and customer detriment. Finally, the FCA reminded firms about the launch of its Live & Local events, which are being launched from July 2017.
On 23 June 2017, the FCA released Handbook Notice No 45, updating on legislative changes and giving consultation feedback. The changes include increases in fees and levies for 2017/18, changes to the Conduct of Business sourcebook (COBS) to give clients more freedom of choice when selecting suppliers, changes to the Market Conduct sourcebook (MAR) to ensure consistency with the Market Abuse Regulation and the European Securities and Markets Authority (ESMA) guidelines, and changes to reporting requirements.
On 23 June 2017, the FCA published its Enterprise Act Annual Report 2017. The report sets out the changes the FCA have made during the reporting period to impose a requirement, set standards, give or amend guidance for business, or secure compliance with such standards and guidance. Where these changes were qualifying regulatory provisions (QRPs), the report sets out the associated costs for business.
On 26 June 2017, the four stakeholder groups (SGs) of the European Supervisory Authorities (ESAs) published a letter addressed to the European Commission vice-president, Valdis Dombrovskis, to reinforce certain messages that are agreed on across the financial sectors in relation to the role of the SGs and convergence tools.
On 26 June 2017, the European Commission adopted non-binding guidelines on the disclosure of non-financial information by companies, and published a set of FAQs on them. The aim is to help companies fulfil the requirement to disclose relevant and useful information on environmental and social matters in a consistent and more comparable way. The Commission believes appropriate non-financial disclosure is an essential element to enable sustainable finance, and the guidelines propose that companies should disclose relevant information on the actual and potential impacts of their operations on the environment, and on how current and foreseeable environmental matters may affect the company.
On 21 June 2017, the EBA launched the 2016 credit valuation adjustment (CVA) risk monitoring exercise as part of its mandate to monitor the own funds requirements for CVA risk. This picks up from policy recommendation 4 of the EBA’s February 2015 CVA report. The EBA said it expects institutions to complete the exercise by 14 September 2017. The EBA has put on hold its draft guidelines on the treatment of credit valuation adjustment (CVA) risk under the supervisory review and evaluation process (SREP) until further notice, due to continued developments in the CVA risk framework at international level.
On 21 June 2017, the EBA released draft amending regulatory technical standards (RTS) on credit valuation adjustment (CVA) proxy spread. The RTS propose limited amendments to the Commission Delegated Regulation (EU) 526/2014 for determining proxy spread and limited smaller portfolios for credit valuation adjustment risk.
On 22 June 2017, the European Central Bank (ECB) published the text of a keynote speech given by Pentti Hakkarainen, a member of the supervisory board of the ECB, at the FIBI International Banking Conference 2017 in Dublin. Mr Hakkarainen focused on whether competition in the banking industry is a positive thing for the state of global financial stability. He noted that it can be perceived as producing a race to the bottom in terms of banking stability but that this problem can be avoided by providing a robust prudential environment.
On 22 June 2017, the EBA released a discussion paper on the treatment of structural FX. The EBA says that the various interpretations of the FX provision have led to differences in its application, both in EU Member States and across banks, which could lead to significant differences in capital requirements across institutions with similar exposures. The EBA aims to harmonise the application and enforcement of this provision and intends to produce own initiative guidelines on this topic. Comments are sought by 22 September 2017.
On 22 June 2017, the Basel Committee on Banking Supervision (BCBS) published a report on the range of practices in implementing the countercyclical capital buffer (CCyB) policy, examining the varying discretionary elements of jurisidictions’ CCyB policy frameworks and practices. The report also highlights the importance of implementing the Basel standards and provides information on implementation practices related to CCyB policies.
On 23 June 2017, the mandatory buy-in regime of the Central Securities Depositories Regulation (CSDR) could have ‘devastating consequences’ for credit repo market liquidity, the International Capital Market Association (ICMA) warned in a recent report. The trade body also says that the net stable funding ratio (NSFR) under Basel III represents the ‘biggest challenge’ to credit repo intermediation.
On 25 June 2017, the European Commission approved, under EU rules, Italian measures to facilitate the liquidation of BPVI and Veneto Banca under national insolvency law. These measures involve the sale of some of the two banks’ businesses to be integrated into Intesa Sanpaolo. Deposits remain fully protected.
On 26 June 2017, the Council of the EU asked the permanent representatives committee (Coreper) to approve the final compromise texts of two proposals. One proposal is for a regulation laying down common rules on securitisation and creating a European framework that is simple, transparent and standardised. The second proposal is a proposal for a regulation amending Regulation 575/2013 on prudential requirements for credit institutions and investment firms.
On 27 June 2017, the Prudential Regulation Authority (PRA) and Financial Policy Committee (FPC) published a document containing two consultations. The first consultation sets out the FPC's proposed recommendation to the PRA to exclude claims on central banks from the leverage exposure measure in the UK leverage ratio framework, and compensate for the resulting reduction in capital required by the leverage ratio framework by increasing the minimum requirement from 3% to 3.25%. The second consultation sets out the PRA's proposals for implementing the FPC's proposed recommendation, should it be adopted by the FPC. The consultations close on 12 September 2017.
On 27 June 2017, the Bank of England (BoE) published the first of the Financial Policy Committee (FPC) twice-yearly financial stability reports (FSRs) for 2017. The FSR sets out the FPC’s assessment of the outlook for financial stability in the UK. Overall, the FSR finds that the risks from the domestic environment are at a standard level: most financial stability indicators are neither particularly elevated nor subdued.
On 22 June 2017, the FCA published a new guide on the foundations of good cyber security. The guide covers key points on effective cyber security practice, including encryption, disaster recovery and network and computer security.
On 28 June 2017, the National Audit Office (NAO) published a report ‘Bank of England Progress delivering the ‘One Mission, One Bank’ strategy’. The NAO believes clear responsibility for delivering the ‘one mission, one bank’ strategy has enabled the bank to make progress towards many of its specified actions, such as the organisation and reward of staff. However, the NAO said some of the more challenging elements still require progress such as embedding cultural change and delivering significant data projects.
SI 2017/692: The Money Laundering Regulations 2007 and the Transfer of Funds (Information on the Payer) Regulations 2007 are replaced with updated provisions that implement in part the Fourth Money Laundering Directive (2015/849/EU) (MLD4) and the Wire Transfer Regulation (2015/847/EU) (WTR). The changes come into force on 26 June 2017.
SI 2017/693: These Regulations implement aspects of Article 30 (requiring a central register of beneficial ownership information for corporate and other legal entities) of MLD4, in relation to companies, including unregistered companies, and limited liability partnerships. They also make minor changes to and extend the scope of Part 21A of the Companies Act 2006 (CA 2006), which requires companies to keep a register of people with significant control over the company (a PSC register), its application to LLPs, and the Register of People with Significant Control Regulations 2016, SI 2016/339, to bring the UK’s domestic regime into compliance with the Directive’s requirements. The Regulations come into force on 26 June 2017.
On 22 June 2017, International Monetary Fund (IMF) managing director Christine Lagarde spoke about the organisation’s efforts to combat money laundering and terrorist financing at the Financial Action Task Force (FATF) plenary meeting.
On 22 June 2017, a report published by Europol and the European Union Intellectual Property Office (EUIPO) revealed organised crime groups are involved in intellectual property crime. It also found EU-based criminal gangs involved in distributing counterfeit goods rely predominantly on manufacturers based abroad. The growing role of technology in intellectual property crime was also observed as counterfeit goods are increasingly distributed via online marketplaces.
On 23 June 2017, the Serious Fraud Office (SFO) announced it had closed its investigation into the conduct of liquidity auctions held by the BoE during the financial crisis in 2007-2008. The focus of the investigation was whether assistance had been provided to certain financial institutions to enable them to bid successfully for the available funding, to the possible detriment of other institutions. The SFO said there was no evidence of criminality in relation to the matter.
On 23 June 2017, HM Treasury released an advisory notice about the risks posed by unsatisfactory money laundering and terrorist financing controls. The list warns that DPRK and Iran are high risk for the purposes of the Money Laundering Regulations (MLR) 2007, and advises firms to apply enhanced due diligence measures in accordance with the risks. It also warns that appropriate actions should be taken to minimise risks, which may include enhanced due diligence measures in high-risk situations, in relation to Bosnia and Herzegovina, Ethiopia, Iraq, Syria, Uganda, Vanuatu, and Yemen.
On 23 June 2017, the Financial Action Task Force (FATF) released details of its plenary meeting in Valencia on 21-23 June. The main issues discussed were combating terrorist financing and improving transparency of beneficial ownership.
On 26 June 2017, the Joint Money Laundering and Steering Group (JMLSG) issued revised guidance on the provisions of the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017. The guidance also takes account of the draft risk factor guidelines published by the European Supervisory Agencies in October 2015, which have not yet been published in their final form.
On 26 June 2017, the Financial Reporting Council launched a public consultation on revised material to make auditors aware of their responsibilities under UK law with respect to money laundering. The existing material has been updated to take account of new legislation passed by the government to transpose MLD4 into UK Law. The consultation closes on 8 September 2017.
On 26 June 2017, HM Revenue and Customs (HMRC) published guidance on Money Laundering Supervision: Enforcement Measures under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 (the Regulations). The guidance sets out how HMRC will use its enforcement powers under the Regulations and says HMRC may treat any breach of the Regulations as a criminal matter.
On 26 June 2017, HMRC published guidance on Money-laundering supervision: money service businesses. The guidance sets out how such businesses should comply with measures under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017.
On 26 June 2017, the joint committee of the ESAs published final guidelines on anti-money laundering and countering the financing of terrorism. The guidelines are part of the ESAs’ work on creating consistency and efficiency in the approach to anti-money laundering and countering the financing of terrorism by both credit and financial institutions, and anti-money laundering and countering the financing of terrorism supervisors.
On 26 June 2017, the joint committee of the ESAs published draft regulatory technical standards (RTS) to help Member States determine when payment service providers and electronic money issuers should appoint a central contact point (CCP) to support anti-money laundering and countering terrorist financing (AML/CTF).
On 27 June 2017, the FCA published a webpage reminder about new money-laundering notification requirements for firms authorised under the Financial Services and Markets Act 2000 (FSMA 2000) and supervised by the FCA under the Money Laundering Regulations. Firms are required to notify the FCA if they carry out certain activities that come under these Regulations but are not part of their FSMA permissions. The Money Laundering Regulations 2017 came into force on 26 June 2017 and update the UK’s anti-money laundering regime. Regulation 23 requires authorised persons to inform the FCA if they are undertaking money service business (MSB) or trust or company service (TCSP) activities.
On 26 June 2017, the CMA published a speech by CMA Chairman, David Currie, marking the end of the CMA’s first three years since replacing the Office of Fair Trading (OFT) and the Competition Commission. The CMA has streamlined processes, resulting in investigation of 57 mergers of the 600 or so brought to the CMA's attention in the past year, versus an annual average of 84 in the preceding five years. The CMA has also reduced the average duration of phase 1 investigations to 34 working days, compared to around 40 in the final years of the OFT. Mr Currie notes the CMA is better as a joined up entity, for example carrying out a consumer law review as part of a market study into care homes. Mr Currie also highlights record fines imposed by the CMA in the past year, asserting that substantial fines on companies help to cement the CMA's reputation as a determined and effective enforcer, and help to deter others from breaking the law.
SI 2017/701: Parts of Directive 2014/65/EU on markets in financial instruments (MiFID II) are transposed into UK law. Provisions are also made giving effect to Regulation (EU) 600/2014 on markets in financial instruments (MiFIR). These changes come into effect in part on 29 June 2017, and in full on 3 January 2018.
SI 2017/699: A new regulatory regime governing data reporting service providers (DSRPs) is established to transpose Title V and parts of Title VI of MiFID II. These changes come into effect in part on 3 July 2017, and in full on 3 January 2018.
On 22 June 2017, ESMA announced is to renew the composition of the consultative working group of its post-trading standing committee (PTSC). It is looking for candidates from any part of the EU and from across the spectrum of European post-trading. The PTSC contributes to fostering supervisory convergence among the national authorities in post-trading matters by developing guidelines, opinions, Q&As, peer reviews and by determining common supervisory actions. Expressions of interest from stakeholders are sought by 31 July 2017.
On 22 June 2017, a poll conducted by RSRCHXchange, the aggregator and marketplace for institutional research, has shown 85% of asset managers expect to comply with MiFID II rules in Q4 2017 or later. However, just two weeks before the regulation comes into force, more than half (54%) of funds still feel they don’t have enough information on research unbundling.
On 22 June 2017, the FCA issued a consultation on proposed changes to the FCA Handbook so that it is consistent with the EU Benchmarks Regulation (EU) 2016/1011 (BMR), most of which will apply from 1 January 2018. Comments are sought by 22 August 2017.
On 22 June 2017, the Securities and Markets Stakeholder Group (SMSG) issued an own initiative report in which it advises ESMA on various issues relating to the product intervention measures that ESMA and national competent authorities (NCAs) will be able to take under the MiFIR.
On 23 June 2017, Commission Implementing Regulation (EU) 2017/1110 and Commission Implementing Regulation (EU) 2017/1111 laying down implementing technical standards (ITS) with regard to forms, templates and procedures pursuant to MiFID II were published in the Official Journal of the EU.
On 23 June 2017, the Governing Council of the European Central Bank (ECB) adopted a recommendation to amend Article 22 of the Statute of the European System of Central Banks and of the European Central Bank. The amendment will give the ECB a clear legal competence in the area of central clearing, which would enable the Eurosystem to exercise the powers that are foreseen for central banks issuing a currency under the review of the European Market Infrastructure Regulation (EMIR) proposed by the European Commission.
On 23 June 2017, the European Commission launched a consultation on the development of secondary markets for non-performing loans (NPLs), with a view to addressing the large volumes of NPLs currently held by banks in the EU. The Commission is seeking to understand the legal barriers, estimate the problems' scale and evaluate whether action at EU level is appropriate. Comments are due by 20 July 2017.
On 23 June 2017, the European Commission published four draft delegated regulations supplementing the Benchmarks Regulation. The Commission has invited feedback on the drafts by 20 July 2017. The proposed delegated regulations cover the following matters:
On 26 June 2017, the Committee on Payments and Market Infrastructures (CPMI) and the International Organization of Securities Commissions (IOSCO) published a consultative report for public comment on harmonisation of critical over-the-counter (OTC) derivatives data elements (other than UTI and UPI), third batch. Comments and feedback are due by 30 August 2017.
On 26 June 2017, the Council of the EU published a corrigendum to the Commission staff working document addressing information barriers in the small and medium enterprise (SME) funding market in the context of the Capital Markets Union, published on 6 June 2017. The amended version corrects an error in the footnote cross-referencing.
On 27 June 2017, ESMA published final guidelines on trading halts under MiFID II. Under MiFID II Member States must require a regulated market to be able to temporarily halt or constrain trading if there is a significant price movement in a financial instrument on that market or a related market during a short period and, in exceptional circumstances, to be able to cancel, vary or correct any transaction.
On 28 June 2017, ESMA sent a letter to the European Parliament, the European Commission and Council of the EU, updating them on the implementation of ESMA’s IT projects regarding the recast Markets in Financial Instruments Directive (MiFID II).
On 22 June 2017, the European Commission announced it is seeking preliminary views on an initiative aimed at reducing national regulatory barriers to the cross-border distribution of investment funds. The initiative forms part of the Commission’s Capital Market Union action plan. The deadline for feedback is 20 July 2017.
On 23 June 2017, ESMA published advice from the Securities and Markets Stakeholder Group (SMSG) on the issues that it believes should be the focus of an upcoming review of securities lending practices by undertakings for collective investment in transferable securities (UCITS). ESMA is intending to carry out a peer review of compliance with its 2014 guidelines for competent authorities and UCITS management companies in the second half of 2017.
On 23 June 2017, the Council of the EU published a Presidency progress report on the proposal for a Regulation of the European Parliament and of the Council amending Regulations (EU) 1616/2013 and (EU) 2015/1017 as regards the extension of the duration of the European Fund for Strategic Investments (EFSI) as well as the introduction of technical enhancements for that Fund and the European Investment Advisory Hub.
On 27 June 2017, the FCA published a policy statement, PS17/13: Investment and corporate banking: prohibition of restrictive contractual clauses, which sets out rules to ban clauses that restrict competition without being clearly beneficial to clients.
On 26 June 2017, the European Parliament’s Committee on Economic and Monetary Affairs (ECON) responded to the European Banking Authority’s report of 20 December 2016 on ‘Covered bonds: recommendations on harmonisation of covered bond frameworks in the EU’, calling for a directive to address the various issues highlighted. The motion for a European Parliament resolution stresses that domestic and cross-border investments in covered bonds have worked well in EU markets under the current legislative framework and says that diversity of sound and safe products should be maintained.
On 27 June 2017, the European Parliament set the indicative plenary sitting date—11 September 2017—for the first reading of the proposed regulation amending Regulation (EU) 345/2013 on European venture capital funds and Regulation (EU) 346/2013 on European social entrepreneurship funds. The proposed regulation seeks to strengthen the internal market for venture capital and social entrepreneurship funds by developing the use of EuVECA (European venture capital funds) and EuSEF (European social entrepreneurship funds) labels for marketing qualifying funds.
On 27 June 2017, the general secretariat of the Council of the EU invited the permanent representatives committee (PRC) to approve the final compromise text relating to amendments to the European Venture Capital Funds Regulation (EU) 345/2013 (EuVECA) and the European Social Entrepreneurship Funds (EuSEF) Regulation 346/2013.
On 28 June 2017, IOSCO announced that it will hold a World Investor Week from 2-8 October 2017, to promote greater investor education and protection worldwide. IOSCO says securities regulators across the globe will provide a variety of activities, including launching investor-focused communications and services, promoting contests to increase awareness of investor education initiatives, organising workshops and conferences, and conducting local and national campaigns in their own jurisdictions.
On 28 June 2017, the FCA published the final findings of its asset management market study and announced a package of remedies it will take forward to address the concerns identified in its interim report into the sector.
On 23 June 2017, the PRA updated supervisory statement SS34/15 to include updated notes for completing the Mortgage Lenders and Administrators Return (MLAR). The update follows the PRA’s consultation CP45/16, ‘Amendments to Notes for completion of the MLAR’, to which it received no responses. The notes take effect on 1 July 2017.
On 23 June 2017, the chair of the EBA, Andrea Enria, gave the introductory speech at the joint ESAs’ Consumer Protection Day. Mr Enria reviewed the progress the ESAs had made in supporting a better functioning of the Single Market and looked ahead at the potential for technological developments to transform markets.
On 28 June 2017, the EBA published its annual consumer trends report for 2017. The report covers the retail banking products that fall in the EBA's consumer protection mandate, including mortgages, personal loans, deposits, payment accounts, payment services and electronic money. The report also provides an overview of the topical issues identified in 2017 that may impact consumers and other market participants, namely indebtedness, banking fees and costs, selling practices, innovation in payments, foreign currency loans, alternative financial services providers, and innovative uses of consumer data.
On 22 June 2017, the executive director for insurance at the PRA, David Rule, wrote a Dear CEO letter to insurance CEOs with observations based on feedback from the monitoring-the-market questionnaire that was recently completed by market insurers. The PRA says the findings show another year of continued softening in premium rates and some evidence of widening in terms and conditions. However, while premium rates reduced, overall premium adequacy is marginally higher, which raises the question of whether some firms are taking an overly optimistic view of current pricing.
On 23 June 2017, the FCA published a speech made by its executive director of strategy and competition, Christopher Woolard, on improving access to insurance. Speaking at the launch of the Cancer and Travel Insurance conference on 20 June, Mr Woolard said the FCA wanted to understand the market and consumers’ journeys better and has launched a call for input focusing on access to travel insurance to get views from firms and to seek innovative solutions to these issues.
On 26 June 2017, the Law Commission (LC) laid its Final report: Pension funds and social investment Law Com No 374) before Parliament for comment. The report follows a 3 November 2016 request by the then Minister for Civil Society, Rob Wilson MP, that the LC look at how far pension funds may or should consider issues of social impact when making investment decisions.
On 26 June 2017, independent analysis commissioned and published by the Association of British Insurers (ABI) has shown the insurance and long term savings sector is one of the UK’s most productive industries, contributing more than £40bn a year to the economy. The analysis shows the sector is the world’s leading exporter of insurance and long term savings, selling £13bn more overseas than it buys back.
On 27 June 2017, HM Treasury published a letter, dated 26 June 2017, from HM Treasury economic secretary Stephen Barclay, to London Market Group (LMG) chair Nicholas Aubert, regarding the insurance linked securities (ILS) project. In the letter, Mr Barclay notes that with global insurance business evolving rapidly, the UK must innovate if London is to retain its important position in the market.
On 28 June 2017, EIOPA published the first set of comprehensive statistical information on the European insurance sector based on Solvency II regulatory reporting. EIOPA says the statistics contain ‘up-to-date and high-quality data’, including country breakdowns and distributions of key variables, providing a comprehensive picture of the European insurance sector, allowing comparability.
On 21 June 2017, the European Commission published the 226 responses it received to its public consultation on FinTech: a more competitive and innovative European financial sector. The consultation sought input from stakeholders to further develop the Commission’s policy approach towards technological innovation in financial services. The Commission says the feedback will help it gauge how FinTech can make the EU Single Market for financial services more competitive, inclusive and efficient.
On 22 June 2017, Faster Payments launched a new Trust Service that will potentially cut the cost for challenger banks and others of obtaining the services that are essential to securely access the UK’s payments systems.
On 22 June 2017, the ECB announced that its TARGET instant payment settlement (TIPS) service, for the settlement of instant payments in the euro area, is scheduled to start operating in November 2018. The aim is to increase integration across the region.
On 22 June 2017, the European Parliament published a scrutiny paper setting out the current position of the draft regulatory technical standards (RTS) on separation of payment card schemes and processing entities under Article 7(6) of the Interchange Fees Regulation (IFR). The European Commission and the European Banking Authority cannot agree on three issues, concerning independence requirement for firms’ staff, general employee share plans and benefits arrangements, and the conditions under which multiple directorships can be held by the same person.
On 23 June 2017, the European Commission adopted a delegated regulation setting out regulatory technical standards (RTS) for the co-operation and exchange of information between competent authorities on the establishment and freedom to provide services of payment institutions.
On 27 June 2017, following news that the European Commission adopted a delegated regulation setting out regulatory technical standards (RTS) for the co-operation and exchange of information between competent authorities on the establishment and freedom to provide services of payment institutions, the Council of the EU invited delegates to approve the text.
On 27 June 2017, the Financial Stability Board (FSB) published a report of work it has undertaken to analyse potential financial stability implications from FinTech, in order to identify supervisory and regulatory issues of which supervisory authorities should take note.
On 28 June 2017, the vice-chair of the supervisory board of the ECB, Sabine Lautenschläger, delivered a speech—‘Harmonisation paves the way for a European banking market’—at the Federal Financial Supervisory Authority 15th anniversary event in Bonn. Ms Lautenschläger said the stability of the financial system can only be ensured by global rules, and said she was worried by recent proposals by the US Department of the Treasury to postpone implementation, or cancel, elements of global reform. Ms Lautenschläger said she hoped that, once the Basel Committee has concluded its work on Basel III this year, all the major financial markets would implement the new standard—‘in Europe and elsewhere’.
The Court of Justice of the European Union gave a preliminary ruling in which it decided, among other things, that Article 7(1)(b) of Regulation (EU) No 1215/2012 should be interpreted as meaning that, where a credit institution had granted a loan to two jointly and severally liable debtors, the 'place in a Member State where, under the contract, the services were provided or should have been provided', within the meaning of that provision, was, unless otherwise agreed, the place where that institution had its registered office, and that also applied with a view to determining the territorial jurisdiction of the court called upon to hear and determine an action for recourse between those joint debtors.
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