12 Days of Christmas Legal, Regulatory and Tax updates 2019


12 Days of Christmas Legal, Regulatory and Tax updates 2019

Deloitte sent to me...

Over the last 12 working days we have sent you a different Legal, Regulatory or Tax insight. As the year end approaches, we hope you will find these informative and useful when finalising your strategic plans. We look forward to continuing to collaborate with you in 2020 to create innovative solutions for all of your global business needs.

12. 2020 Investment Management outlook

For investment managers, 2020 is a year to cross boundaries: embracing new ways of operating and new technology to achieve growth, improve efficiencies and enhance client experience. This article explores the outlook for investment management in the coming year, highlighting the ways that firms can realise growth and transform their operations to ensure long-term success.

11. Be SEAR ready in 2020

In anticipation of a Senior Executive Accountability Regime for Irish Financial Service Providers, here are 12 Steps that our clients can take to become SEAR Ready in 2020.

These steps fall under three main areas:

  1. Housekeeping
  2. Planning
  3. Influencing

10. A more sustainable Christmas

In an effort to be more environmentally aware and make more sustainable choices we are asking people to consider greener options this Christmas.

1. Christmas tree

What kind of Christmas tree has the lowest carbon footprint? We've probably passed the deadline on this but if you're still considering what kind of Christmas tree to get, the answer is a real potted tree that you can keep alive. This may not be an option for many people however so a locally sourced real tree that is properly disposed of after use is the next preferable option (roots attached is best but not always possible). If however you already have a synthetic tree, please do continue to use for as long as possible.

2. Gift wrapping

Why not try some alternatives to the glittery wrapping paper this year. Source old scarves or material from vintage shops, buy hemp or organic cotton patterned materials from sustainable producers or go for a rustic feel with brown paper and cotton ribbons.

3. Recycle, reduce and reuse

Be more mindful of your choices this year. Choose the green option where feasible. 

9. The future of cyber survey

Deloitte Cyber set out to gain insights into how leaders are embracing the concept of “cyber everywhere;” how they are operating in the new cyber norm, and how they are collaborating with partners and other key stakeholders.

The Deloitte 2019 future of cyber survey was conducted in conjunction with Wakefield Research among 500 C-level executives who oversee cybersecurity at companies with $500 million or more in annual revenue including 100 chief information security officers, 100 chief security officers, 100 chief technology officers, 100 chief information officers, and 100 chief revenue officers.

With our survey report, our goal is to put the numbers into context and expand the dialogue and acceptance of cyber everywhere so that organizations are not limited by it but empowered to embrace the opportunities it will create.

8. Managing M&A Integrations: An Integration Implementation Guide for Investment and Wealth Managers

M&A is a crucial route to growth for investment and wealth managers. Yet as the sector rapidly consolidates, the examples of integrations genuinely delivering the potential benefits of M&A remain elusive.

In this paper we explore the six common areas of concern that should be top of mind in all investment and wealth manager M&A projects and provide a path to getting each one right:

  • setting strategic direction
  • working towards cultural fit
  • systematising integration management
  • securing the talent base
  • planning for technology integration
  • setting realistic synergy targets.

7. Fund managers and boards: Corporation tax filing/payment deadlines for Irish resident countries

Fund managers and boards should stay on the nice list and ensure that Irish resident companies meet the following upcoming corporation tax filing/payment deadlines.

Deadline Accounting year end in scope Filing/payment
23 December 2019 31 December 2018 File iXBRL tagged financial statements
  31 March 2019 File corporation tax return
  30 June 2020 Pay first instalment of corporation tax (“large” companies)
  31 January 2020 Pay second instalment of corporation tax
30 December 2019 31 March 2019 File Form 46G

The following tax law changes in Finance Bill 2019 will come into force in the coming weeks and should also be considered:

  • Revised Irish transfer pricing rules (effective for chargeable periods beginning on or after 1 January 2020)
  • New anti-hybrid rules (effective for payments made from 1 January 2020)
  • Amended anti-avoidance provisions for securitisation (S110) companies.

6. ESMA Releases Final Report on Liquidity Stress Testing for UCITS and AIFs

Over the coming year, fund liquidity looks set to remain a regulatory and supervisory priority for the Central Bank of Ireland (“CBI”) and at a European supervisory level.

On the 2nd of September 2019, ESMA issued their Final Report Guidelines on Liquidity Stress Testing for UCITS and AIFs (ESMA Guidelines) which contained 16 guidelines for UCITS managers and AIFMs and one for depositaries. The ESMA Guidelines apply to all UCITS and AIFs, money market funds, ETFs, and leveraged closed-ended AIFs.

5. The global framework for fighting financial crime: A paper from The Institute of International Finance and Deloitte

The financial services industry invests huge amounts of resources to tackle financial crime, however the scale and impact of the problem are immense, with criminals continually evolving their capabilities to exploit the existing AML framework. This is because the current regulatory framework is not effective enough to empower financial institutions to combat the continuously evolving networks and tools available to criminals.

Based on interviews with key players from financial institutions and law enforcement as well as policy makers and regulators, this report from Deloitte, in conjunction with The Institute of International Finance, The global framework for fighting financial crime, explores seven key areas in financial crime regulation.

4. Asset Management: Integrating ESG risk into a risk management framework

The transition of environmental, social, and governance (ESG) factors from concept and investor preference to regulatory requirements poses a challenge to asset managers, particularly with regard to integrating sustainability risk factors into existing Risk Management Frameworks.

In this article we set out some of the practical considerations for asset managers, when taking a risk based approach to ESG.

3. Understanding the strategic and regulatory risks of artificial intelligence in financial services

Artificial intelligence (AI) is poised to transform the financial services industry. But financial institutions are constantly grappling with identifying the right use cases for deploying AI. How can they ensure responsible deployment of AI and reap the benefits, while effectively navigating the associated risks?

This report by Deloitte and the World Economic Forum explores the risks associated with deploying AI in financial institutions and presents strategies to mitigate them. We examine these risks through the lens of five frequently cited areas. They are:

  • AI explainability
  • Systemic risk and AI
  • Bias and fairness
  • The algorithmic fiduciary
  • Algorithmic collusion

2. Within reach? Achieving gender equity in financial services leadership

Despite their efforts, many financial firms have yet to achieve a greater representation of women leaders. This report offers a roadmap for cultivating more female executives to lead the industry forward.

Key messages

  • In 2019, the proportion of women in leadership roles within financial services firms is 21.9 percent, which is projected to grow to 31 percent by 2030—still below parity.
  • At an organizational level, our analysis reflects that across financial services organizations, for each additional woman added to the C-suite, the number of women in senior leadership roles rose threefold.
  • Among the key challenges that could impact succession, the percentage of women in senior leadership roles has not kept pace with those in the C-suite, and this gap has widened since 2010.
  • Strategies for improving leadership outcomes for women should be multifaceted and inclusive.

1. China's investment management opportunities: Reforms could create a multitrillion-dollar market for foreign firms

China's reforms have opened a $30.2-trillion opportunity for foreign investment managers. To win in this complex market, foreign firms should develop segment-specific strategies, alternative data capabilities, and partner with online wealth platforms.

Key takeaways

  • The Chinese government is reforming the country’s pension system, capital markets, and investment management industry as a part of a bigger plan to curb an anticipated retirement savings deficit.
  • Foreign investment managers have the opportunity to play a greater role in the tightly regulated industry, potentially managing a sizeable chunk of the US$30.2-trillion addressable retail financial wealth by 2023.
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