Latest Legal and Regulatory news update - 18th June

Latest Legal and Regulatory news update - 18th June

In this issue:


Risk & Compliance



Information Law & TMT



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Coronavirus (COVID-19) virtual forum for in-house counsel

Join our free COVID-19 virtual forum on 30th June 2020, hosted in partnership with Radius Law and F‐LEX, to hear from your peers, share experiences and discuss best steps to protect your organisation during the coronavirus pandemic. Further information and registration details are available here.

Virtual networking lunch for junior lawyers

F-LEX are hosting free virtual networking lunches for paralegals, trainees and junior lawyers in collaboration with LexisNexis and Crafty Counsel. These sessions will be held every Wednesday, last for 45 minutes and provide a great opportunity for you to network with your peers. Further information and registration details are available here.



Risk & Compliance

Coronavirus (COVID-19)

The Information Commissioner’s Office (ICO) has published six data protection steps for organisations, setting out the key principles organisations need to consider regarding the use of personal information as lockdown restrictions start to ease and businesses begin to reopen following the coronavirus pandemic. See: LNB News 15/06/2020 13.

The ICO has also published guidance on information rights as workplaces and shops are beginning to reopen with lesser lockdown restrictions. The ICO has recognised the importance in knowing your data protection rights regarding personal information, particularly in relation to health data. See: LNB News 15/06/2020 12.

How can compliance teams ensure progress made with compliance initiatives is not lost during the coronavirus (COVID-19) lockdown period? As many commentators have observed, there is no coronavirus defence for non-compliance, so it is imperative that leadership teams keep on top of their compliance agendas and ensure business practices do not stray into shaky territory while businesses float in uncharted waters. See Q&A: How do Chief Compliance Officers and their leadership teams ensure the traction and momentum they have gained with their compliance initiatives are not lost during the lockdown period, while they are physically ‘out of sight’ from their commercial teams?

Crime prevention

The Office of Financial Sanctions Implementation has published specific guidance regarding financial and investment restrictions in the Russia financial sanctions regime. The guidance is only information at the time of publishing (17 June 2020) and will not apply until 11.00 pm, 31 December 2020, or when then the Russia (Sanctions) (EU Exit) Regulations, SI 2019/855 come into force. See: LNB News 17/06/2020 12.

The Serious Fraud Office (SFO) has announced the closure of its investigation into Da La Rue Plc, a British company manufacturing paper and security printed products. Following an extensive investigation and a thorough review of the available evidence, which started in July 2019, the SFO concluded that the case did not meet the prosecution test laid out in the Code for Crown Prosecutors. See: LNB News 16/06/2020 49.

MLex: A corruption probe into ABB, dropped in May 2020, saw the SFO conduct 15 interviews and 1,411 hours of investigation, MLex has been told in response to a Freedom of Information request. See News Analysis: Halted ABB probe saw SFO conduct 1,400 hours of investigation.

Kerri McGuigan, associate at Peters and Peters, discusses the launch of the European Financial and Economic Crime Centre which is designed to support co-operation between and among law enforcement authorities in EU Member States in the battle against serious and organised crime. See News Analysis: Enhanced support—the launching of the European Financial and Economic Crime Centre.

Compliance culture

Law360: The US Department of Justice’s (DOJ’s) recently amended corporate compliance guidance is valuable because it elucidates enhanced access to data, resource allocation, improved training, corporate benchmarking and consideration of foreign laws, say John Cunningham and Kody Sparks at Buchanan Ingersoll. See News Analysis: DOJ guidance provides meaningful compliance road map.

Legal services regulation

University College London (UCL) Centre for Ethics and Law has published its findings on a review of the current regulatory framework for legal services. The independent review, led by Professor Stephen Mayson, explored issues raised by the Competition and Markets Authority's 2016 legal services market study. The report concluded that the current regulatory structure provides an incomplete and limited framework for legal services regulation and that it is not able to meet the demands and expectations placed on it both in the short term and beyond. See: LNB News 11/06/2020 61.





Steven Gee QC, commercial barrister and arbitrator, and Kristina Lukacova, barrister, both at Monckton Chambers, discuss coverage under business interruption insurance during the coronavirus pandemic. See News Analysis: Proving causation—business interruption insurance coverage amid coronavirus (COVID-19).

The United Nations Conference on Trade and Development has published its World Investment Report 2020, which highlights that coronavirus will likely change the nature of global production. The report concluded that coronavirus will amplify existing challenges within the global production market, including the new industrial revolution, growing economic nationalism, and focus on sustainability. The outcome is likely to play out differently across countries and regions, resulting in four outcomes: reshoring, diversification, regionalisation and replication. See: LNB News 16/06/2020 39.

The Cabinet Office and Ministry for Housing, Communities & Local Government have updated their guidance on closing certain businesses and venues in England for the duration of the coronavirus pandemic. On 15 June 2020 further businesses and venues were allowed to reopen, including what has been deemed non-essential retail. See: LNB News 16/06/2020 30.


The case of Purbrick v Cruz involved a building dispute in which the employer, P, obtained a freezing injunction against the builder, C, who was sole shareholder and director of MM Cruz Developments Ltd (CDL). C resisted the continuation of the injunction on grounds of material non-disclosure in relation to the issue of whether he was the contracting party. C claimed CDL was the contracting party. The court determined that P had a good arguable case that C had contracted personally and continued the injunction. This is another case concerning the question of whether a person who signs a contract does so personally or as agent. Written by Richard B Ritchie, barrister, at XXIV Old Buildings, Lincoln’s Inn. See News Analysis: Parties to contract—whether signatory acting as agent or principal (Purbrick v Cruz).

The case of Glossop Cartons v Contact (Print and Packaging) considered the true measure and quantification of damages in a claim for fraudulent misrepresentation. It was held that the innocent party should not be compensated for potential commercial risks that they had appreciated at the time when entering into the agreement and factored into the purchase price. To do so would serve to overcompensate them for the consequences of the fraud. Written by Georgia Whiting, barrister, 4 King’s Bench Walk. See News Analysis: The correct approach to assessing damages in the case of deceit (Glossop Cartons v Contact (Print and Packaging).

The court in MV Promotions v Telegraph Media Group considered a part 8 claim for a declaration of construction or, alternatively, rectification. The relevant mistake was as to the identity of one of the contracting parties. The remedy sought would have tax consequences, but the contracting parties had not been motivated by those consequences at the time of contracting. The court rejected the construction claim and declined to exercise its discretion to grant rectification, despite the preconditions for rectification have been made out. This case provides a stark illustration of the need for caution when seeking to remedy issues voluntarily, particularly in cases where tax is a concern. Written by James Saunders, barrister, at New Square Chambers. See News Analysis: The pitfalls of voluntary rectification (MV Promotions v Telegraph Media Group).


The Advertising Standards Authority (ASA) has launched a UK Scam Ad Alert system designed to identify scam advertisements on digital advertising and social media platforms. Created in partnership with platforms, such as Google and Facebook, and alongside the Internet Advertising Bureau, the system will assist in taking down online paid-for scam ads, particularly those leading to fraudulent content. Consumers are now able to report scam ads to the ASA, who will alert all participating platforms. The platforms can then remove the offending ad, suspend the advertiser’s account or add them to a blocklist. See: LNB News 16/06/2020 33.





The Financial Reporting Lab, established by the Financial Reporting Council (FRC), has issued two reports to provide practical guidance to companies. The reports focus on the areas of corporate reporting that the Financial Reporting Lab has identified as being the most critical to investors during the economic uncertainty caused by the coronavirus pandemic. The first report sets out the nature of the disclosures that investors expect to see from companies during the coronavirus pandemic. It notes that, while historical information on a company's position is always valuable, reporting on a business’s future, its risks and its strategy is increasingly important in the current situation. The second report gives specific guidance on going concern, risk and viability disclosures that may be made by a company. See: LNB News 15/06/2020 54.

Company disclosures & records

Two related cases deal with the disclosure of company documents in the context of an investigation by the FRC.

The case of A v B [2020] EWHC 1491 (Ch) concerned an investigation by the FRC into the audit of the 2018 financial statements of the claimant company (A) under the Statutory Auditors and Third Country Auditors Regulations 2016, SI 2017/516. A claimed that certain documents, in the possession of its auditors (B) and sought by the FRC, were subject to privilege. A sought a declaration that B was obliged to withhold production to the FRC of such documents (or parts of documents, six in total) on the grounds of A’s assertion of its privilege, as it had provided the information to B on a limited waiver basis. There was no dispute as to B’s obligation to maintain the privilege if the documents were, in fact, privileged. The court found it was not appropriate to grant the declaration sought by A. The court held that the declaration sought neither dealt with the dispute as to the existence and extent of the legal rights between the parties in the most effective way, nor declared the true position as a matter of law. A proper appreciation of the source of the parties’ respective obligations pointed the way to the correct solution. It was for B to determine under its counterclaim whether a document was privileged, not because it had been under no obligation to disclose it if it made a determination that it was, but because it was the person by whom the duty to disclose on service of a statutory notice was imposed.

The case of A v B [2020] EWHC 1492 (Ch) concerned B’s counterclaim against A to determine whether or not any of the six documents fell into a category that meant B would be entitled to refuse to produce them in High Court. In respect of five of the documents, A raised questions of legal advice privilege. The sixth document was said to be protected from disclosure by litigation privilege. The court (applying established law) held that none of the disputed documents had fallen into that category.



Information Law & TMT


EU Member States, with the support of the European Commission, have agreed on technical specifications which should ensure safe exchanges of information between national contact tracing apps. Users travelling to another EU country will be notified if they have been in contact with an infected person even outside their country of origin. The proximity information shared between apps will be exchanged in an encrypted way so as not to identify individuals, in line with the EU data protection guidelines for apps. Additionally, no geolocation data will be used. See: LNB News 16/06/2020 87.

Data protection

The European Data Protection Supervisor (EDPS) has published an opinion on the European Commission’s communication from 19 February 2020, titled ‘A European strategy for data’, a strategy which aims to create a single European data space. In its opinion, the EDPS ‘applauds the Commission’s commitment to ensure that European fundamental rights and values, including the right to the protection of personal data, underpin all aspects of the Data Strategy and its implementation’, but suggests that proving the viability and sustainability of an alternative data economy model, one which is open, fair and democratic, and able to ensure a proper balance between the interest of the society and the data subject is maintained, should be a key objective of the data strategy. See: LNB News 17/06/2020 57.

The European Data Protection Board (EDPB) has, during its 32nd plenary session, adopted a statement on the interoperability of contact tracing apps, and a statement on the opening of borders and data protection rights. The EDPB has also adopted two letters to MEP Moritz Körner, concerning encryption and Article 25 of the General Data Protection Regulation (EU) 2016/679 (the GDPR) and a letter to the Committee of European Auditor Oversight Bodies on US Public Company Accounting Oversight Board arrangements. See: LNB News 17/06/2020 52.

The EDPB has responded to questions from members of the European Parliament regarding the lawfulness of a data access agreement reached between the UK and US. Among other things, the EDPB notes that when it comes to a possible adequacy decision for the UK, the EDPB considers that the data access agreement will have to be taken into account in the overall assessment of the level of protection of personal data in the UK. See: LNB News 16/06/2020 92.

The ICO has made a statement responding positively to the government laying the Age Appropriate Design Code, otherwise known as the Children's Code, before Parliament. The Children’s Code is required under section 123(1) of the Data Protection Act 2018 and aims to ensure online services appropriately safeguard children’s personal data. See: LNB News 12/06/2020 6.

Cloud computing

MLex: The EU’s cloud-computing venture, Gaia-X, introduced last week by France and Germany to respond to US and Chinese competitors, may fail to become a global standard. Also, as Franco-German industrial interests are not always aligned with the EU’s common interests, the project might clash with, rather than inspire, the bloc’s upcoming legislation on data sharing and governance. See News Analysis: Comment—EU cloud-computing venture may fail to become global standard.





Three new guidance documents and six updated guidance documents were published by HMRC late on 12 June 2020 to set out further information in relation to the revised version of the Coronavirus Job Retention Scheme (CJRS) that will operate from 1 July 2020 until 31 October 2020 (under which flexible furloughing will be allowed and the portion of a furloughed employee’s wages paid under the scheme through the grant will gradually taper). See News Analysis: Revised 1 July Coronavirus Job Retention Scheme: HMRC publishes further and updated guidance.

HMRC published updated guidance on the Self-Employment Income Support Scheme (SEISS) on 12 June 2020, providing further information on the extension of the SEISS to allow a second, and final, grant in August 2020 and providing examples of when an individual’s business might be ‘adversely affected’ by coronavirus (COVID-19). See News Analysis: HMRC updates Self-Employment Income Support Scheme (SEISS) guidance with further information on second and final grant.

The guidance on the treatment of certain travel expenses and home office equipment provided to employees during coronavirus (COVID-19) has been updated. See: LNB News 15/06/2020 76.

The Pensions Regulator has updated its COVID-19 guidance for employers on automatic enrolment (AE) and defined contribution pension contributions to recognise that from 1 July 2020, staff on furlough under the Coronavirus Job Retention Scheme may work part of the time for their employer. The guidance also recognises that for claims starting on or after 1 August 2020, employers will no longer be able to claim a grant for up to the statutory minimum AE employer contribution. See: LNB News 15/06/2020 18.





The Department for International Trade (DIT) has published the UK's negotiating objectives for Free Trade Agreements (FTAs) with Australia and New Zealand, with talks for each expected to take place by video conference in the coming weeks. The DIT also published a policy document setting out its roadmap towards membership of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Reaching trade deals with existing CPTPP members including Australia and New Zealand is part of that plan. See: LNB News 17/06/2020 76.

Adam Rendle, partner at Taylor Wessing, discusses the UK’s draft working text for a comprehensive free trade agreement and how the UK’s copyright policy may develop after Brexit. See News Analysis: Copyright in the UK post Brexit—how may the UK ‘take back control’?

Border controls

The Cabinet Office has confirmed that border controls for imported EU goods will be introduced in stages after IP completion day, in order to allow businesses affected by coronavirus to prepare. The new border controls and procedures come as the Chancellor of the Duchy of Lancaster, Michael Gove, formally notified the EU that there will be no extension to the transition period. See: LNB News 12/06/2020 61.

UK-EU cross-border services

With UK and EU banks’ passport rights to provide cross-border services between the UK and EU set to end on 31 December 2020, UK Finance has published a briefing discussing how the EU regime for cross-border services under the Markets in Financial Instruments (MiFIR) operates. See: LNB News 17/06/2020 91.



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About the author:
Allison is a former partner of Shoosmiths, with extensive experience of legal management and practice compliance.