Emma RadmoreHM Treasury is consulting on the promised amendments to the MLRs. It has published the draft amending regulations for comment by 30 September.
As Treasury noted in its feedback to its consultation on the need for change, this set of changes:
- substitutes all references to euros with references to sterling (sometimes just changing the word and so making the amount larger, but in others changing the amount so the amount is roughly a current equivalent);
- includes “selling an off-the-shelf firm” within the TSCP and legal professionals list of covered activities;
- substitutes references to “complex” with “unusually complex”;
- places an obligation on firms supervised by the FCA to tell it if there is a material change or inaccuracy in information given to the FCA within 30 days of the change or discovering the inaccuracy;
- includes further requirements on firms providing customers with pooled accounts;
- gives some leeway to make it easier for credit institutions to open bank accounts for customers of banks that have become insolvent;
- substitutes the phrase “high-risk third country” with “a FATF call for action country”;
- align CDD triggers for letting agents and AMPs with those for high value dealers;
- sets EDD requirements for crypto firms entering into correspondent relationships;
- applies the trust registration requirements to an arrangement that acquired an interest in UK land before 6 October 2020, creates additional definitions for specific types of trust and broadens the list of excluded trusts;
- enhances supervisory co-operation and reporting requirements;
- modifies the change in control requirements in relation to registered crypto businesses; and
- adds a new exemption in the Exemption Order in respect of sovereign wealth funds operated by a central bank or public body.
Treasury expects to lay the final instrument in early 2026 and for it to take effect 21 days after that, except for the crypto-related provisions which will need to tie in with the expansion of the FSMA perimeter for crypto activities.