Regulatory Radar: quick takes

This section gives a sample of the extensive updates that form our bi-monthly Regulatory radar: quick takes publication

Advertising and marketing

ASA issues new advice for online marketplace sellers

The Advertising Standards Authority (ASA) has published a factsheet containing advice on the advertising rules applicable to online marketplace sellers. These sellers are defined as acting as businesses advertising products or services on third-party online marketplaces including Amazon, eBay and Etsy, not individuals who occasionally sell second-hand items. According to the factsheet, sellers need to substantiate factual claims and hold evidence for such claims. Listings should not be misleading or inaccurate and sellers should be transparent about availability and delivery fees if these are being set by themselves.

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Report launched by ASA on ad labelling in podcasts

The ASA has published a research report following an investigation in June 2023 into host-read ads in podcasts, and to what extent these are clear and identifiable. The research found that listeners are in favour of stronger regulation of ads in podcasts, including the use of terms such as "sponsored by" to indicate the presence of adverts. Such terms could also be supported by sound markers and changes in voice tones. Listeners also would support regulation to limit misleading claims especially to avoid host-read ads or claims to be perceived as recommendations from the host.

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ASA releases a range of new guides on ad content

The ASA has released several guides on including particular content in ads, including how and when to include members of the Royal Family, how to reference mental health and mental health issues, and how to advertise in-game purchases.

Royally important advice on Royalty in ads >>

A guide to treating Mental Health responsibly in ads >>

Guidance on advertising in-game purchases >>

New rules and guidance on alcohol alternatives published by ASA

New rules in the CAP and BCAP Code came into force on 14 May 2024 in relation to advertising drinks with an ABV at or below 5% being promoted as alcohol alternatives. The rules apply to ads that are to be perceived by the audience as marketing alcohol alternatives. When cross-promoting alcohol alternatives with alcoholic drinks, ads that effectively promote the latter should follow the rules that apply to advertising alcoholic drinks. Unsafe circumstances and consumption habits normally associated with alcoholic drinks can be depicted in ads for non-alcoholic drinks as long as the audience is made aware that the products are alcohol free.

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AI

High-Level Group for the Digital Markets Act agrees to coordinate efforts to ensure that AI development aligns with the DMA objectives

At a meeting of the High-Level Group for the Digital Markets Act on 22 May 2024 in Brussels, the group published a statement highlighting the need to have a coordinated approach on AI in order to meet the objectives of the Digital Markets Act (DMA). The group will also put together a sub-group specifically focused on AI that will monitor developments in the field; research methods of enforcement and regulation that could be helpful to implement the DMA in relation to AI; and ensuring an even regulatory approach across the DMA and other instruments through cooperation.

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Cyber

New regulations enforcing consumer protections against hacking and cyber-attacks take effect

On 29 April 2024, new laws that protect consumers against hacking and cyberattacks entered into force. The new protections require manufacturers of smart devices with an internet connection, including TVs and phones, to meet security standards such as a ban on easily guessable or common passwords.

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Data

ICO and Ofcom release joint statement on collaboration on the regulation of online services

On 1 May 2024, the Information Commissioner's Office (ICO) and Ofcom released a joint statement to highlight their collaboration on online safety and data protection while carrying out their regulatory duties. The two bodies will work to identify issues that are of interest and relevance to both, as well as companies and services, and they will promote information sharing among employees and staff.

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Financial services

HM Treasury and European Commission release joint statement on the second EU-UK Financial Regulatory Forum

On 24 May 2024, HM Treasury and European Commission published a joint statement following the second meeting of the Joint EU-UK Financial Regulatory Forum. The Forum has financial stability as a common objective and participants highlighted the need for cooperation between the EU and the UK in order to preserve the market and protect consumers. Participants discussed the current economic outlook and risk factors as well as developments in areas such as sustainable finance, banking, and digital finance and AI.

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PRA publishes its approach to the authorisation and supervision of insurance branches

On 23 May 2024, the PRA published a policy statement as feedback to the responses received on the consultation in regards to the regulator's approach to insurance branches and their authorisation and supervision. The PRA's proposals in the consultation aimed to consolidate its approach to insurance branches and update the regulator's expectations in relation to third-country branches.

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Economic Secretary to the Treasury delivers speech on the future of UK finance

Bim Afolami, the Economic Secretary to the Treasury, presented a keynote speech during the Bright Blue event on 17 May 2024. The speech focused on the reforms that have been enacted for the financial services sector, including the Edinburgh Reforms, the Mansion House Reforms the Financial Markets and Services Act 2023 and the Private Intermittent Securities and Capital Exchange System (PISCES). PISCES will create a new class of market in order to give a more cohesive approach between public and private markets, with more access to UK capital markets for private companies.

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Professional services

Bar Standards Board implements changes to its regulatory arrangements to widen its powers to protect the public

Following a consultation held in June 2023 and subsequent approval from the Legal Services Board, the Bar Standards Board (BSB) has implemented amendments that allow the body to wide in powers in order to protect the public. The Disciplinary Tribunal will be able to restrict a barrister's practicing certificate or withdraw their practising rights on an interim basis in cases where a decision on misconduct has been deferred. A new ground of referral is also added by allowing the BSB to refer individuals to an interim suspension panel.

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Pensions

FRC publishes new technical actuarial standards for collective money purchase pensions

The Financial Reporting Council (FRC) has published version 1.0 of Technical Actuarial Standard 310 (TAS 310) for collective money purchase pensions. TAS 310 was introduced after a consultation to reflect developments in this emerging pension scheme model. It outlines different actuarial considerations compared to defined benefit or contribution pensions. The new standard aims to maintain trust and address risks in collective schemes by providing requirements around assumptions, modelling, advice on assessments, valuations, and actuarial factors as this market grows in the UK. The FRC also updated guidance on proportionality with examples relevant to TAS 310.

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Product regulation

MHRA announces a proposed regulatory framework for international recognition of medical devices

On 21 May 2024 the Medicines and Healthcare products Regulatory Agency (MHRA) announced a statement of policy proposing a framework that would allow regulatory approvals from Australia, Canada, the EU and the US to be recognised by the UK Government. This is to reduce the possibility of assessments being duplicated when carried out by comparable regulators, among other benefits. The framework is still in the draft stage.

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FSA publishes consumer information on ultra-processed food

The Food Standards Agency has published consumer information regarding the current science and evidence around ultra-processed foods (UPFs) and the agency's role. There has been recent public debate on the potential link between high UPF consumption and poorer health. The UK government advises following the Eatwell Guide for a balanced diet. In testimony to the House of Lords Committee on Food, Diet and Obesity, the FSA's Chief Scientific Advisor discussed the importance of clear consumer information. Research shows public concern and confusion about UPFs and food processing has increased considerably. As an evidence-based organisation, the FSA aims to provide clear facts to enable informed consumer choices based on the current science around UPFs.

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White collar crime

HM Treasury publishes annual report for 2022 to 2023 on anti-money laundering and counter-terrorist financing supervision

The Treasury has published its annual report for 2022-2023 on the supervision of anti-money laundering (AML) and counter-terrorist financing (CTF) measures. The report provides information on the performance of AML/CTF supervisors appointed by the Treasury to monitor businesses' compliance with Money Laundering Regulations. It includes supervisory and enforcement data from both public sector and professional body supervisors, highlighting notable changes in activity and any fines issued. The report fulfils the Treasury's obligation under the Regulations to publish an annual review consolidating information from all designated AML/CTF supervisors on their supervisory actions.

The Treasury will set out more in the coming months about the future structure of the supervisory system following the consultation in 2023. They are also already consulting on updates to the Money Laundering Regulations and finalising a new effectiveness framework to better evaluate the effectiveness of AML/CTF supervision.

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