Financial Services and Markets Bill [HL]

The government has introduced the Financial Services and Markets Bill in the House of Lords, legislation that represents the most comprehensive reform of financial services regulation since the regulatory framework was established at the turn of the century.

The bill gives the financial regulators — the Bank of England, the Financial Conduct Authority and the Prudential Regulation Authority — new secondary objectives to promote the competitiveness of the UK financial services industry and to support the government's objectives for economic growth. These new objectives have been controversial, with critics arguing that they could compromise the regulators' primary objectives of safety and soundness, consumer protection and market integrity.

The bill also introduces a new framework for the regulation of digital assets, including cryptocurrencies and stablecoins, bringing them within the regulatory perimeter for the first time. The framework is designed to provide clarity and confidence for the growing digital asset industry while ensuring that the risks associated with these new technologies are properly managed.

Other provisions of the bill include reforms to the prospectus regime to make it easier for companies to raise capital on public markets, changes to the rules governing short selling and the transparency of share ownership, and new powers for the regulators to impose penalties for misconduct. The bill is expected to complete its parliamentary passage by mid-2027.