On 18 January 2024, the Authority of Financial Markets (AMF) unveiled its action plan and supervisory priorities for 2024 (including its new SPOT control priorities). This regular meeting, which is now firmly anchored in the regulatory agenda of regulated entities in the Paris financial center, allowed the AMF to reiterate that this action and supervision plan is determined based on its analysis of the sector’s risks.
These announcements are also in line with those made in June 2023 on its “Impact 2027” strategic orientations. In its 2022 annual report, the AMF presented its strategic orientations for the period 2023-2027, marked by the ambition of demanding and adapted regulation and an increase in its international action.
The AMF recalls that its ambitions remain high in a context where France is now the leading European financial center, and stresses that it wishes to play its full part in supporting its attractiveness. This subject will also be at the center of the major issues at the beginning of the year, the Minister of the Economy, Finance and Industrial and Digital Sovereignty, Bruno Le Maire, announced his wish to present a bill to the French Parliament on the financial attractiveness of France. This bill’s parliamentary work is already underway.
To achieve its objectives, the AMF is counting on modernizing its technical tools by investing in data-driven supervision and the development of artificial intelligence as part of its missions, maintaining and increasing its international and European actions, increasing its financial resources within the framework of the 2024 Finance Act and so-called “tighter” internal management.
Unsurprisingly, the announcements made by the regulator are, once again, dense.
Impact 2027: 6 strategic axes broken down into 17 priority actions
A demanding regulator for a leading financial center
- Action 1: deploying demanding supervision based on risk analysis.
- Action 2: supporting issuers for the first publication of sustainability reports for the end of the 2024 financial year in the context of a first application of the CSRD Directive.
- Action 3: contributing to the work on the attractiveness of the Paris financial center, particularly for listed companies.
- Action 4: making the Paris financial center an attractive location for European long-term investment funds (ELTIFs).
Strong international action
- Action 5: acting as a force for proposals within the framework of the new European mandate, with a view to a possible relaunch of the European Capital Markets Union.
- Action 6: contributing to international work on the impact of the development of non-banking finance on financial stability.
Investor protection
- Action 7: forming a better understanding of investors and protecting themby deploying a financial education strategy focused on new investors, in line with the work of the OECD.
- Action 8: extending the supervision of financial offers to influence business.
- Action 9: continuing the work and actions to supervise funds in terms of fees, distribution, valuation and equal treatment of investors.
Promoting a more sustainable financial sector
- Action 10: promoting a review of the SFDR.
- Action 11: participating in ESMA’s Joint Supervisory Action on sustainability preferences and conducting targeted SPOT controls on sustainable finance.
- Action 12: carrying out a mystery shopping campaign on the theme of sustainable finance and disseminate the conclusions.
Supporting innovation
- Action 13: continuing the work on artificial intelligence and participating in the implementation of the European Regulation on Artificial Intelligence Legislation (AIA).
- Action 14: rolling out a transition plan to the more demanding European MiCA authorization for digital asset service providers (DASPs), with a regulatory and a supervisory component.
An attractive authority serving the public interest
- Action 15: carrying out a new campaign to promote the employer brand.
- Action 16: overhauling the AMF’s activity and performance indicators, setting up and monitoring indicators to assess the deployment of strategic orientations with a multi-year perspective.
- Action 17: conducting targeted perception studies with AMF stakeholders.
15 monitoring and supervision priorities, including 7 SPOT control themes
Management companies
- monitoring ratios, claims and compensation; SPOT 2024 control theme
- the qualification and level of knowledge of the employees; SPOT 2024 control theme
- in terms of sustainable finance, voting and shareholder engagement policies, which are becoming increasingly important in the environmental, social and governance and communications strategies of asset management companies; SPOT 2024 control theme
- governance and the role of managers; the valuation of real estate assets and in the unlisted segment. SPOT 2024 control theme
Intermediaries and market infrastructures
- the quality of reporting data (under MiFIR) and transaction data from reporting on derivatives (EMIR) and securities financing transactions (SFTR) and CSDR;
- algorithmic trading activities;
- the involvement of the compliance function in cross-functional processes relating to employee conduct; SPOT 2024 control theme
- the market abuse system with classic control actions on the prevention and detection system;
- governance and control of outsourced activities.
Marketing and consulting
- sustainability preferences in the customer journey; SPOT 2024 control theme
- innovative, cross-border and/or complex digital offerings;
- automated investment advice to non-professional clients; SPOT 2024 control theme
- supervision of the players in the “marketing” ecosystem: investment service providers (ISPs) and/or their agents ;
- costs and charges in discretionary management;
- supervision of financial investment advisers (AIFs).
These announcements articulate the means enabling the AMF to maintain, and increase, the level of requirement of its action in order to provide the players of the Paris financial center with high-quality, i.e. effective and proportionate supervision.