Quarterly Technical Briefing

#1 Autumn 2024

Editorial comment

Aidan Golden
Head of Group Technical Services

Welcome to the inaugural edition of Utmost Navigator, our brand-new quarterly technical briefing! At Utmost Wealth Solutions, our technical team boasts extensive expertise in tax, legal, and regulatory matters. We are dedicated to providing practical and timely support to our partners, and with Utmost Navigator, we aim to elevate our technical offerings even further.

Each edition of Utmost Navigator will keep you updated with the latest developments in tax, regulatory, and legal landscapes within our core life assurance markets. You’ll also discover the latest enhancements in our products and services, all designed to support your evolving needs. Get to know our Technical Services Team better and see how we can assist you.

One of the key themes that we explore in our first edition is portability. Our clients lead sophisticated, mobile lives, and as their personal circumstances change, so do their financial planning needs. Life insurance remains a straightforward and widely recognised financial structure across Europe and beyond. Our portability solutions are crafted to be a crucial part of planning for your clients’ financial futures.

Don’t miss out on Pulse – our innovative tool that highlights upcoming regulatory, tax and compliance changes. Whether at the UK, EU, international or local level, Pulse will keep you informed and prepared. We will ensure this tool is updated with every edition to provide you with the most current information.

We are also thrilled to feature an exclusive interview with José Luis López-Hermida of KPMG Spain. In conversation with Nerea Llona, our Tax and Legal Counsel for Spain and LatAm, José shares insights on the latest trends in wealth migration and taxation. He also delves into the benefits and flexibility of unit-linked life insurance in wealth and succession planning.

We hope you find our first edition both informative and inspiring.

Aidan Golden
Head of Group Technical Services

PulseRegulation, Tax and ComplianceTechnical SpotlightCountry FocusCase Study InsightsUpcoming Events Download PDF

In this issue

Pulse

The key developments in regulation, tax and compliance by market.

Regulation, Tax and Compliance
Technical Spotlight

Portability

Country Focus

France and Spain

Case Study Insights
Upcoming Events

Upcoming webinars and other industry events

Ask Our Team

Get in touch with the Technical Services team

Pulse

Keep your finger on the industry pulse with our quarterly round-up of the most important regulatory and compliance developments in the wealth management sector.

Updated quarterly, this overview reflects the position at the time of publication.
For the latest developments, please refer to the most recent edition.

UK
Financial Conduct Authority (FCA) Anti-Greenwashing Rules

Sustainability disclosure and investment labelling regime for funds.

31 May 2024

  • All sustainability-related claims must be clear, fair, and not misleading.
  • From 31 July 2024, sustainable product labels can be used for funds meeting specific sustainability criteria, with four labels to choose from.
  • Naming and marketing rules come into force for fund managers on 2 December 2024.

UK
Consumer Duty

Rules start for closed products/services.

31 July 2024

  • Embedded before recent parliamentary changes; deadlines for in-scope firms to implement have passed.
  • The FCA is now monitoring the implementation and effects of the Duty.

UK
Financial Conduct Authority (FCA)

Market study into how Pure Protection Insurance Products are sold.

11 October 2024

  • FCA has published proposed terms of reference for the upcoming market study into the distribution of Pure Protection Products to retail customers.
  • Comments on these terms of reference to be received by 11 October 2024.

UK
Financial Conduct Authority (FCA) Anti-Greenwashing Rules

Sustainability disclosure and investment labelling regime for funds.

2 December 2024

  • Naming and marketing rules come into force for fund managers.

UK
Solvency II UK Regime

Solvency II regime reforms come into force (with some exceptions).

31 December 2024

  • Reforms include certain provisions of the relevant Statutory Instruments (SIs) and revocation of Solvency II assimilated law

UK
UK PRIIPs Revocation and Replacement Disclosure Regime

Consultation on new disclosure regime to replace UK PRIIPs (delayed).

2025

  • FCA consultation document on a new consumer disclosure regime delayed but is expected by year-end.
  • The new terminology has been released, with the term ‘PRIIP’ being replaced with ‘consumer composite investments’.
  • The existing exemption for UK UCITS Funds in providing a UK PRIIPs document expires in 2027.

EU
Sustainable Finance Disclosure Regime (SFDR) Changes

ESAs propose SFDR changes.

31 July 2024

  • The European Supervisory Authorities (ESAs) have proposed several changes to the existing SFDR, including a simplified categorisation system.
  • These proposals contribute to the European Commission’s ongoing review of the SFDR and its effectiveness.

France
Green Industry Law No. 2023-973 of 23 October 2023

Greater transparency within policies and funds.
Changes to the information provided to customers prior to the purchase and sale of a fund within a life insurance policy.

24 October 2024

  • Greater transparency and clear communication on surrender penalties on life insurance policies or funds.
  • New rules on the pre-contractual information that must be provided to customers.

France
Green Industry Law no. 2023-973 of 23 October 2023

Reinforcement of “the duty to advise”.
Creation of a financial profile for the customer, to be updated proactively.

24 October 2024

  • Introduction into French law of a range of measures requiring regular updating of the information collected from policyholders throughout their investment life.

Italy
Institute for the Supervision of Insurance (IVASS)

Second Consultation on revised set of rules on permissible assets and investment restrictions for index and unit-linked products.

December 2024

  • Almost two years since the first consultation in 2022, IVASS launched a second public consultation in March 2024 (closed May 2024) on revised rules for permissible assets, investment restrictions for index and unit-linked products, and its views on biometric risk requirements. Once approved, these will apply to both domestic and EU insurers operating in Italy on a FoS basis.
  • Utmost provided feedback to the Regulator on the revised rules, aiming to minimise the impact the proposed changes might have on the Italian product and market.
  • In a recent meeting with Insurance Ireland and Financial Services Ireland, IVASS confirmed its ambition to issue the final regulation by the end of this year, reaffirming their intention not to adjust the scope of the regulation.

EU
Digital Operational Resilience Act (DORA)

Deadline for compliance.

January 2025

  • DORA ensures the resilience of financial services firms during operational disruptions. It focuses on IT risk and incident reporting, setting technical standards.
  • Firms must comply with these regulations by January 2025.

EU
Corporate Sustainability Reporting Directive (CSRD)

Large companies required to track CSRD data for 2026 reporting.

January 2025

  • CSRD requires EU firms, including qualifying EU subsidiaries of non-EU businesses, to disclose their environmental and social impacts in a standardised format.
  • Additionally, firms must report on how their business is affected by their environmental, social, and governance (ESG) actions.
  • This directive aims to drive transparency and accountability within firms and increase the focus on sustainability.
  • The reporting deadlines for the CSRD depend on the size of the entity. From 01 January 2025, large companies (250+ employees) must track CSRD data for 2026 reporting.

France
Green Industry Law no. 2023-973 of 23 October 2023

Transaction fees banned for arbitrage mandates
Introducing a DDA interpretation within French law on life insurance dealing charges (in arbitration mandates).

1 January 2026

  • Transaction costs on traditional private bank accounts managed on a discretionary basis are still permitted in France.
  • Transaction costs will be prohibited on discretionary managed life insurance policies from 1 January 2026.

EU
Artificial Intelligence (AI) Act

Majority of provisions in the Act to take effect.

2 August 2026

  • Published in the EU Official Journal on 12 July 2024, the AI Act classifies AI systems based on their potential risk, banning those with unacceptable risk and regulating high-risk systems.
  • Applies to all organisations that develop, use, distribute, or import AI systems in the EU, even if they are not EU-based.
  • Legal application to be phased in over the next three years, with most provisions taking effect on 2 August 2026.

EU
Retail Investment Strategy (RIS)

Retail Investment Strategy PRIIPs and IDD changes.

2027

  • RIS aims to boost consumer protection and confidence in the financial sector through enhanced disclosure requirements and financial promotion rules, for example, to encourage customers to invest in financial products across the Union. It has two main components:
    • The Omnibus Directive, which significantly amends IDD, MiFID II, UCITS, AIFMD, and Solvency II.
    • Amendments to the PRIIPs Level One Regulation, paving the way for new technical standards
  • Negotiations on aspects such as inducement rules and value-for-money benchmarks have been intense. The EU ‘trilogue’ negotiations are expected to begin in November 2024, following the new Commission’s term commencement.
  • Given the complexity of these legal updates, the strategy is not expected to be in effect until 2027.

EU
EU Anti-Money Laundering (AML) and Countering the Financing of Terrorism (CFT)

6th AML Directive (AML D6) and new AML Regulatory Package.

2027

  • This package includes a directive outlining the mechanisms member states must implement, a regulation establishing the Authority for AML and CTF, and a significant regulation to replace the current Fifth AML Directive.
  • The new regulation aims to address inconsistencies in the local application of the directive by introducing directly applicable rules across the EU. This will be supplemented by sets of yet-to-be-published Regulatory Technical Standards.

Malaysia
Guideline related to Income Tax (Exemption) (No. 6) Order 2022 (Amendment) Order 2024

Clarified tax treatment for foreign income.

June 2024

  • Foreign income received in Malaysia by residents will be taxable, with certain exemptions for foreign dividend income and other specified conditions.
  • Detailed guidelines issued for the tax treatment of foreign income received in Malaysia, including exemptions and record-keeping requirements.

Taiwan
CFC Reporting for Offshore Trusts

Tightened tax rules for offshore trusts held by Taiwanese residents.

July 2024

  • New ruling issued by the Ministry of Finance supplementing the CFC ruling in January 2024 that imposes Alternative Minimum Tax (AMT) on the settlor/beneficiaries of offshore trusts when CFC is involved.
  • Offshore trustees must register with Taiwan tax authorities, prepare accounts and detailed income and distribution statements for all trust assets. Trustees without a presence in Taiwan must appoint a local agent.

Hong Kong
Proposed Company Re-domiciliation Regime

New regime to allow foreign companies to change their place of incorporation to Hong Kong.

July 2024

  • Streamlined process for businesses to re-domicile to Hong Kong.
  • Applies to foreign companies of different types and scales.
  • A comprehensive regime follows the fund re-domiciliation regime implemented in Nov 2021 which established a simplified fund re-domiciliation regime for Open-Ended Fund Companies and Limited Partnership Funds.

China
Enforcement of Six-Year Rule

Taxation on global income for long-term foreign residents.

December 2024

  • Six-Year Rule introduced from January 2019. 2024 marks the first year that this rule is applicable.
  • Foreigners residing in China for more than 183 days per year for six consecutive years will be taxed on their global income. The six-year period can be reset by leaving China for more than 30 consecutive days.

Singapore
Family Office Tax Incentives Economic Criteria for Qualifying Funds

Extension and revision of tax schemes.

January 2025

  • Changes to economic criteria for sections 13D, 13O, and 13U to take effect from January 2025.
  • Extension of tax incentives for qualifying funds until end of 2029.
  • Inclusion of Limited Partnerships under section 13O scheme.
  • Revised economic criteria for qualifying funds, including potential introduction of a minimum fund size and increased business spending commitments.

Hong Kong
Family Office Policy Further Review and Tax Concessions

Enhanced measures and tax regime for family offices.

May 2025

  • Ongoing measurement of the Capital Investment Entrant Scheme (CIES) and Family-owned Investment Holding Vehicles (FIHVs) introduced in March 2024.

Thailand
Potential New Law on Foreign Income

Comprehensive taxation on foreign income.

2025>2026

  • Further revision of foreign income taxation effective from 1 January 2024. Foreign income brought into Thailand will be taxed in the year it is brought in, regardless of when earned. This eliminates the previous tax deferral strategy.
  • Proposed amendments may require individuals residing in Thailand for more than 180 days to pay tax on foreign income, even if not brought into Thailand. This is still in early legislative stages.

Regulation, Tax and Compliance

Update on Irish Revenue Registration for UK Trustees 

Simon Martin
Head of UK Technical Services

Under Irish rules, UK Trustees holding an Irish life policy must register on the Irish Central Register of Beneficial Ownerships of Trusts (CRBOT).

The original registration process was unfit for UK Trustees, as it assumed they would access the CRBOT through the Revenue’s Online Service (ROS). This proved cumbersome, leading to the suspension of the registration process for UK Trustees while an alternative solution was sought. However, this suspension did not remove the requirement for Irish life companies to check for discrepancies between the information provided by Trustees and the register.

Read the article

Technical Spotlight

Portability

Brendan Harper
Head of Asia and HNW Technical Services

Introducing The Utmost Continuity Service

As the only company among its peer group with a footprint in Europe, Asia, and the Middle East, Utmost Wealth Solutions is uniquely positioned to offer compliant solutions to High-Net-Worth (HNW) individuals and families with multi-jurisdictional profiles that span continents.

Read the article

Peter Tung
Tax and Legal Counsel – Asia

Leveraging Life Insurance for a Smooth and Tax-Efficient Transition to Australia

Imagine a high-net-worth family that has worked tirelessly to accumulate their wealth, with family members contemplating a move to Australia. They aim to pass this wealth to the next generation, who will become Australian residents. How can they ensure this transition is both smooth and tax-efficient? One intriguing solution lies in leveraging life insurance solutions.

Read the article

Country Focus

Spain: The European Alternative to the Anglo-Saxon Trust: Unit-Linked Life Insurance

Nerea Llona
Tax and Legal Counsel – Spain and LatAm

In an interview with Nerea Llona, Tax and Legal Counsel – Spain and LatAm, José Luis López-Hermida of KPMG Spain discusses the use of unit-linked life insurance as an alternative to Anglo-Saxon trusts for high-net-worth individuals in Spain. This article explores the benefits and flexibility of unit-linked life insurance in wealth and succession planning.

Read the article

France: Transform Dismembered Capital Efficiently with Life Insurance

Benjamin Fiorino
Wealth Planner / Tax and Legal Counsel, France and Monaco

Our Senior Wealth Planner for France, Benjamin Fiorino, shares insights into our cutting-edge expertise on the complex topic of dismemberment.

Read the article

Case Study Insights

Nerea Llona
Tax and Legal Counsel – Spain and LatAm

Ensuring Tax-Efficient Investments for Retirement in Spain 

Jim, a 60-year-old UK tax resident, is planning to retire in Spain at age 65. With a lump sum of €2,000,000 to invest, Jim seeks a tax-efficient solution that remains compliant in both the UK and Spain.

This case study explores how a tailored offshore bond can provide the flexibility and tax advantages needed for a smooth transition to retirement abroad.

Read the Case Study

Events and Webinars

Stay updated on our webinars and other industry events where Utmost will have a presence.

Market
Event
Date

Singapore

STEP Asia Conference 2024

12-13 November 2024

Find out more

Italy (Milan)

Annual Associazione Italiana Private Banking (AIPB) Private Banking Forum 2024

21 November 2024

Find out more

UK

Utmost Wealth Solutions’ post-UK Budget webinar

27 November 2024

Register

Technical ServicesTeam

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To contact the team, simply get in touch via the Ask Us Anything form below.

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Ask us anything

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