Latest legal and regulatory news: 4th March

Latest legal and regulatory news: 4th March

In this issue:

In-house

Risk & Compliance

Commercial

Corporate

Info law and TMT

Employment

LexTalk®In-house: a Lexis®PSL community




In-house

 

Virtual networking and forum events

There’s no need to feel isolated if you’re working from home—join one of our virtual networking or forum events. Even if you aren’t working from home, take some time to network with your peers, find out what challenges they’re facing and how they are meeting those challenges.

24 March 2021
The commercial benefit of effective panel management
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An opportunity to share experiences and helpful insights with your peers under Chatham House rules. This month we focus on effective panel management. Discover how legal teams take a strategic approach to law firm management to demonstrate commercial value to their organisations.
28 April 2021
Making the intangible, tangible: Demonstrating value as an in-house legal function
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In this session we discuss how in-house counsel are approaching value creation through Chatham House peer discussion and sharing results from a benchmarking study of over 300 UK legal teams. Which activities provide higher value and increase the influence and impact of the legal team? What practical approaches can you consider to harness untapped areas of opportunity?
26 May 2021
Your essential regulatory and commercial news update: Brexit, COVID-19, Data Protection and more
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Iain Larkins, Founder and CEO from Radius Law and Sandra Martins, Head of Employment will highlight the key priorities for legal departments from recent government and regulatory guidance updates and recommended practical next steps to consider. Including Brexit and COVID-19 Stop Press alerts and how to prepare for the outcome of an adequacy decision.
Various dates
LexisNexis® Aspire Forum for Junior In-house Lawyers
To register your interest in joining the events, sign up as an Aspire member today
Aspire is a professional development and networking forum for junior in-house counsel. We have several events planned for the new year to continue supporting you through these uncertain times and provide a platform for you to connect with your peers. Events take place at the same time each month, from 5pm to 6.30pm.

 


 

Risk & Compliance

 

Data protection

MLex: The European Data Protection Board (EDPB) plans to present its opinion on proposed data adequacy decisions for the UK in mid-April 2021. See News Analysis: UK data adequacy decisions due to receive EDPB opinion in mid-April.

MLex: The UK is on the hunt for a new Information Commissioner who is up to the task of rewriting the country’s data protection laws to be more flexible and business-friendly after Brexit. See News Analysis: UK seeks new Information Commissioner with focus on post-Brexit overhaul of data protection rules.


Financial crime prevention

The European Banking Authority (EBA) has published final revised guidelines on money laundering and terrorist financing risk factors. The revisions take into account changes to the EU anti-money laundering and counter-terrorism financing legal framework and address new risks, including those identified by the EBA’s implementation reviews. In addition to strengthening financial institutions’ risk-based approaches to AML/CTF, the revisions support the development of more effective and consistent supervisory approaches where evidence suggests that divergent approaches continue to exist. See: LNB News 01/03/2021 84.

The Financial Action Task Force (FATF) has opened a consultation on its proposed guidance on proliferation financing risk assessment and mitigation. The guidance is being developed to help both the public and private sectors implement new requirements ‘to identify, assess, understand and mitigate proliferation financing risk as defined in Recommendation 1 and its Interpretive Note. The guidance seeks to assist both sectors in conducting a risk assessment in the context of proliferation financing, and applying corresponding risk mitigation measures.’ The FATF welcomes views on the content of the guidance, especially on the areas of focus it outlines. FATF is particularly interested in responses from financial institutions and designated non-financial businesses and professions. The deadline for responding is 9 April 2021. See: LNB News 02/03/2021 85.

The FATF has published comments from the G20 Finance Ministers and Central Bank Governors Meeting on 26 February 2021. FATF President, Dr Marcus Pleyer commended the Italian Presidency’s focus on digitalisation in financial services and said the FATF will ‘contribute to the Italian Presidency’s priority on financial inclusion’. The FATF will also continue working on its guidance on digital ID, will launch a review of the global implementation of standards on virtual assets and stablecoins, and will analyse the opportunities and challenges of digital transformation for anti-money laundering. Dr Pleyer added that ‘The FATF stands ready to support the G20 through work on environmental and climate crime, such as illegal deforestation and illegal wildlife trade’. See: LNB News 01/03/2021 83.

Multinational companies should take a pragmatic approach to US Foreign Corrupt Practices Act (FCPA) compliance by being aware of key risk areas (such as inappropriate gift-giving, liability for third-party actions, and countries with recurring corruption issues) and implementing custom-designed procedures that evolve with their operations, says Howard Weissman at Miller Canfield. See News Analysis: Mitigate key US FCPA risks with tailor-made compliance.


 

Additional Risk & Compliance updates this week

The Law Society has recommended that providers of training contracts pay trainees a minimum of £22,794 in London and £20,217 outside London from 1 May 2021. The increase has been calculated using the Consumer Price Index 12-month rolling inflation rate. There is no regulatory requirement to pay this recommended minimum salary, but the Law Society believes paying trainees at least this sum represents good practice. See: LNB News 26/02/2021 100.


Commercial

 

Spring Budget

In the Spring Budget 2021, on 3 March 2021, the Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP, announced a series of measures to aid business recovery following the coronavirus (COVID-19) pandemic and associated lockdowns. Measures include a rise in corporation tax, the introduction of loan schemes and grants, tax reductions for businesses and a new freeports policy. Harriet Brown, barrister at 15 Old Square Tax Chambers, Maudie Leach, senior solicitor at Macfarlanes, Zoe Feller, partner at Bird & Bird and Adam Cygan, professor at the University of Leicester, comment on the measures announced and the impact on businesses. See: LNB News 03/03/2021 113.


Brexit

The government has published new guidance for businesses that trade over £250,000 worth of goods with the EU annually, new guidance for businesses and holders of international EU protected designs, new promotional material for stakeholders, and updated guidance on taxes and tariffs for EU Businesses. See: LNB News 25/02/2021 87, LNB News 25/02/2021 35, LNB News 01/03/2021 11 and LNB News 02/03/2021 104.


Coronavirus

The High Court considered one of many topical insurance issues left unresolved by the recent Supreme Court ‘test case’ on business interruption insurance (The Financial Conduct Authority v Arch Insurance (UK) Ltd & Others [2021] UKSC 1), namely whether there was cover for losses arising from the coronavirus pandemic under a policy with a ‘closed list’ disease clause. The policy in question provided cover against the outbreak of a range of infectious diseases, including ‘Plague’ but not coronavirus. The policyholder argued that the word ‘Plague’ should be read as a general term for an infectious disease with a high mortality rate, epidemic or pandemic, such that loss caused by coronavirus would be covered. The court rejected this interpretation and held that the word ‘Plague’ was intended to refer to the specific disease caused by the bacterium Yersinia pestis. The clause therefore did not cover loss caused by coronavirus and the policyholder’s claim was struck out. Written by Martyn Naylor, barrister at 4 Pump Court Chambers. Martyn was instructed as junior counsel in the Supreme Court ‘test case’ and recently obtained summary judgment for an insurer in a ‘closed list’ disease clause case similar to the present. See News Analysis: COVID-19 and business interruption insurance—cover for ‘Plague’ (Rockliffe Hall v Travelers Insurance).

Following the Supreme Court decision of the Financial Conduct Authority’s (FCA) test case concerning non-damage business interruption (BI) insurance claims, and the FCA's consultation for the same, the FCA has published Final Guidance: Business interruption insurance test case—proving the presence of coronavirus. The guidance will run from 3 March 2021–31 January 2022, by which time the FCA expects that all issues relating to proving the presence of coronavirus will have been resolved. See: LNB News 03/03/2021 93.


E-commerce

The European Commission has launched a consultation on how to improve working conditions for people working through digital labour platforms. It has been acknowledged that although platform work can ‘offer increased flexibility, job opportunities and additional revenue, including for people who might find it more difficult to enter the traditional labour market’, certain types of platform work are linked with precarious working conditions, ‘reflected in the lack of transparency and predictability of contractual arrangements, health and safety challenges, and insufficient access to social protection’. In the first stage of its consultation the Commission seeks to gather the views of European social partners on the need and direction of possible EU action to improve the working conditions in platform work. The consultation will be open for a minimum of six weeks. See: LNB News 26/02/2021 5.


Corporate

 

Equity capital markets

HM Treasury has published the report of the review of the UK listing regime chaired by Lord Hill. Aimed at encouraging more growth companies (such as in the life sciences and tech sectors) to list in the UK, the detailed set of recommendations are primarily focused on changes to the Listing Rules. A fundamental review of the prospectus regime is also proposed. The Financial Conduct Authority (FCA) aims to publish a consultation paper on Listing Rules changes by the summer and make relevant rule changes by late 2021. See: LNB News 03/03/2021 101.


In the Spring Budget, on 3 March 2021, the Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP, announced measures including the increase in the maximum rate of corporation tax to 25% from 2023, the launch of the Recovery Loan Scheme and new schemes to boost small and medium-sized enterprises (SMEs). Maudie Leach, senior solicitor at Macfarlanes, Ben Jones, partner at Eversheds Sutherland, Zoe Feller, partner at Bird & Bird and Deepesh Upadhyay, principal associate at Eversheds Sutherland, comment on the measures announced and the impact on corporate law. See: LNB News 03/03/2021 118.


 

Companies House has announced it will recommence its compulsory and voluntary strike off process from 8 March 2021. The process had been temporarily halted on 21 January 2021 to ensure that companies were not negatively impacted by any delays caused by having a reduced workforce in the office due to the impact of the coronavirus pandemic. See: LNB News 26/02/2021 66.


 

Brexit

The European Commission has published updated guidance for stakeholders on the withdrawal of the UK from the EU and EU rules on company law. See: LNB News 25/02/2021 104.

The Council of the European Union has formally requested the European Parliament’s consent to its decision on the conclusion of the EU-UK Trade and Co-operation Agreement (TCA), and associated agreements reached between the EU and UK at the end of the Brexit transition period. The European Parliament’s consent will pave the way for the Council’s adoption of the decision on the final conclusion of the agreements, marking the last steps in the EU’s ratification of the agreements and allowing their full entry into force. In the meantime, following its adoption, the TCA Partnership Council’s decision extending provisional application of the TCA until 30 April 2021 entered into force on 26 February 2021. The decision has been published in the Official Journal of the European Union (OJEU). See: LNB News 01/03/2021 78.


 

E-signatures

Real Estate, Corporate and Finance analysis: Katherine Crowley of Womble Bond Dickinson, Dominic Sedghi of Macfarlanes and Jamini Raja of Addleshaw Goddard consider the publication of guides and checklists by various groups of professional support lawyers on the use of e-signatures, as well as the impact of the coronavirus and what the future holds for e-signatures. See News Analysis: Future of e-signatures for real estate, corporate and finance transactions.


Corporate governance

The Financial Reporting Council (FRC) has published guidance for companies on transparent and effective reporting when diverging from provisions under the UK Corporate Governance Code (UKCG Code). The central theme of the new guidance is flexibility. The guidance also recommends easy access to the provisions of the UKCG Code which have been departed from, and to set out clear and effective explanations for any divergence. See: LNB News 26/02/2021 66.


Info law and TMT

 

Data protection

The ICO has called on businesses to act now to ensure they are ready when the Children’s Code comes into force in six months. The Code will comprise 15 standards that must be met when it comes to protecting children’s data online. The ICO has undertaken industry research to gauge the extent to which businesses understand the Code, the results of which will be published in May 2021, and preliminary analysis suggests many businesses have not progressed past the preparation stages yet. See: LNB News 02/03/2021 103.

The ICO has also launched a call for ideas and examples of privacy information designs that cover some or all of the good practice outlined in the Children’s Code transparency standard. The ICO is keen to hear from stakeholders including online services, children’s rights advocates, designers and academics by 11pm 30 April 2021. Submissions can cover any relevant sector and be speculative designs, early-stage prototypes or projects already in use. See: LNB News 02/03/2021 20.

The Information Commissioner, Elizabeth Denham, has highlighted both the value and the challenges of modern data protection in a speech delivered at the Oxford Internet Institute on 3 March 2021. Denham stressed the necessity of public trust in data-driven innovation to maximise its positive impact. According to Denham, data-driven innovation should be part of the UK economy recovery strategy and discussions about the fair use of personal data should be undertaken with the public. See: LNB News 03/03/2021 117.

MLex: UK companies could see a rise of ‘vaccine passports’ required by law to offer access to certain venues, public events, or allow for international travel under plans being considered by the government. Privacy campaigners have criticised the move, and the ICO has also expressed concerns about the implications for privacy. See News Analysis: Vaccine passport plans spark UK privacy debate.

MLex: Real-estate company Deutsche Wohnen has seen the Berlin data protection authority appeal against a German court’s recent annulment of a fine of €14.5m. See News Analysis: Deutsche Wohnen’s data protection fine annulment appealed by Berlin watchdog.

The French data protection regulator, the Commission Nationale de l’Informatique et des Libertés (CNIL), has fined both a controller and a processor for the same data security breach. The CNIL has also set a deadline for website and mobile applications to meet cookies compliance. Jonathan Armstrong and André Bywater, both commercial lawyers at Cordery with a focus on compliance issues, discuss the implications of this case. See News Analysis: French regulator CNIL fines data controller and data processor for security breach and sets deadline for cookies compliance.


ePrivacy

The ICO has published an enforcement notice and a monetary penalty notice to Valca Vehicle and Life Cover Agency Ltd. The £80,000 fine comes after a total of 95,004 unsolicited direct marketing messages were received by subscribers between 15 June 2020 and 20 July 2020, resulting in 114 complaints. See: LNB News 25/02/2021 77.

The ICO has issued a fine of £50,000 to Muscle Foods Ltd after it sent approximately 135,651,627 marketing emails and 6,354,426 marketing SMS messages to individuals without their consent over a period of seven months. See: LNB News 03/03/2021 50.


Employment

 

Spring Budget

In the Spring Budget 2021, on 3 March 2021, the Chancellor of the Exchequer, the Rt Hon Rishi Sunak MP, announced the extension of the Coronavirus Job Retention Scheme, the confirmation of the fourth and fifth SEISS grant, income tax exemptions for coronavirus tests and home office expenses, high quality traineeships for younger people, payments for employers hiring new apprentices, support for apprenticeships across different employers, new technology to help with job finding, publication of the Low Pay Commission’s 2021 Remit, SSP rebate scheme, relaxation in Working Tax Credit hours requirement and additional support for Working Tax Credit claimants. Partner at Baker & McKenzie LLP, Stephen Ratcliffe, partner at Kingsley Napley, Katie Newbury, barristers at Richmond Chambers, Zoe Bantleman and Georgina Griggs and barrister at Pump Court Tax Chambers, Emma Chamberlain comment on the measures announced and the impact on employment. See: LNB News 03/03/2021 125.


 

Coronavirus

The Advisory, Conciliation and Arbitration Service (ACAS) has updated its guidance on getting the coronavirus vaccine for work. A new section has been added on how to offer support to staff that are getting the vaccine, and the section on what employers should do if they feel it is important for staff to receive the vaccine has been updated. Sections on disciplinary action and the options available to staff if they believe their employer is being unreasonable about the vaccine have been replaced with a general section on how to resolve any workplace issues about getting the vaccine. See: LNB News 01/03/2021 85.

On 15 February 2021, the government introduced new measures requiring those travelling to England from a ‘red-list’ country, or those who have travelled through a ‘red list’ country in the ten days prior to arrival, to quarantine in government managed hotels for ten days. Kerry Garcia, partner, Sarah Taylor, PSL and Lucy Hall, trainee, at Stevens & Bolton examine the possible ramifications and the key considerations for employers. See News Analysis: Welcome to the hotel quarantine—key considerations for employers.


 

Pensions

The Department for Work and Pensions (DWP) has published the government response to its automatic enrolment consultation, which aimed to review the alternative quality requirements for pension schemes used for automatic enrolment into workplace pensions. Upon reviewing the consultation responses, the Secretary of State for Work and Pensions, Thérèse Coffey, has concluded that the alternative quality requirements made under section 23A(1) of the Pensions Act 2008 should continue without revisions. See: LNB News 25/02/2021 71.


Benefits

New advisory fuel rates for employers with company car schemes, which apply to all journeys made on or after 1 March 2021, have been released by the government. See News Analysis: Company car fuel: revised advisory rates to take effect from 1 March 2021.


 

Redundancy

In UQ v Marclean Technologies SLU, C-300/19, the Court of Justice of the European Union (CJEU) considered when the obligation for consultation on proposed redundancies, referrable to the number of proposed redundancies, is triggered under the Collective Redundancies Directive. This decision has important implications for the interpretation of section 188 of the Trade Union and Labour Relations (Consolidation) Act 1992 and the obligations of consultation in domestic law. Written by David Reade QC and Daniel Northall of Littleton Chambers. See News Analysis: Counting to 20—the CJEU judgment in UQ v Marclean Technologies SLU.


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