European Commission
Yen Interest Rate Derivatives trading market - European Commission re-adopts cartel decision and re-imposes fines - 28 May 2021
The European Commission has re-adopted a cartel decision against ICAP plc (now NEX International Limited), ICAP Management Services Ltd and ICAP New Zealand Limited, imposing total fines of EUR6.45 million for facilitating five cartels in the Yen Interest Rate Derivatives (YIRDs) trading market.
In 2015, the Commission adopted a decision imposing fines on the same ICAP entities for facilitating six bilateral infringements in the YIRDs sector. In November 2017, the General Court annulled one, and shortened four, of these infringements. The General Court also annulled the fines imposed on ICAP on the basis of inadequate reasoning, specifically that the Commission had not provided sufficient reasons for its methodology in setting the fines. This was particularly important, as the Commission had departed from the general methodology set out in the 2006 Fining Guidelines. As ICAP did not appeal, the General Court’s findings on ICAP’s liability for the five infringements became final, albeit without fines.
The Commission has now re-adopted its cartel decision against ICAP for having infringed Article 101 of the Treaty on the Functioning of the European Union (TFEU) by facilitating several cartels in the YIRD trading market and has re-imposed total fines of EUR6.45m on the ICAP entities. The Commission states that the re-adopted decision addresses the procedural error identified by the General Court and includes a detailed reasoning on the fine calculation.
Decision Case AT.39861 – Yen Interest Rate Derivatives
European Commission Press Release (See item ‘Antitrust: Commission re-adopts decision and fines ICAP €6.45 million for facilitating several cartels in the Yen Interest Rate Derivatives trading market’)
Financial Conduct Authority
Woodford fund investigation - FCA publishes letter to House of Commons Treasury Committee - 28 May 2021
The FCA has published a letter from FCA Chief Executive, Nikhil Rathi, to the House of Commons Treasury Committee Chair, Mel Stride, which provides an update on the FCA’s investigation into the LF Woodford Equity Income Fund. In the letter, Mr Rathi explains that the investigation has made progress and information gathering is nearly complete. He also notes that further analysis and legal advice may give rise to additional lines of enquiry and some witnesses may need to be re-interviewed. Nonetheless, the FCA is confident that the investigation work will be completed by the end of 2021.
Mr Rathi also notes that he is unable to provide further details in relation to the investigation for reasons of confidentiality and to ensure that the investigation, and any potential disciplinary process, is credible and fair. He also states that he is unable to give a precise timeline for any public indication of the outcome, although the investigation is a priority for the FCA. He also confirms that Woodford Investment Management Ltd does not hold any FCA permissions that would enable it to engage in retail investment activities. The FCA remains in close supervisory contact with the firm and will continue to engage with authorities overseas on any potential future activities of the firm or its principals.
Commenting on the update, Mr Stride expressed frustration that the investigation has not yielded any results and the date of any findings is still unknown. He makes clear that the Treasury Committee will consider the findings once they are published.
FCA Letter to the Treasury Committee: LF Woodford Equity Income Fund
FCA Press release
House of Commons (Treasury Committee): Press release
