SEC Climate Disclosures Rules One Step Closer to the Grave; GHG Emissions Disclosures One Step Closer to Becoming a Multi-State Compliance Issue
The slow death of the Securities and Exchange Commission’s (SEC) climate disclosure rules continued on March 27, 2025, with the SEC Commissioners voting to discontinue the defense of such rules before the Eighth Circuit, Iowa v. SEC, No. 24-1522 (8th Cir.), which is where the numerous complaints challenging the rules were consolidated.[1] The SEC’s action does not withdraw or terminate the rules, but while they remain in place, the SEC’s previous stay of the rules continues. It will be interesting to see if the Democratic attorneys general from a number of states who joined the litigation in support of the rules will continue to defend the rules without the SEC’s support.
While the SEC has made clear that it will not be pursuing its climate disclosure rules[2], companies may still need to comply with climate disclosure laws of other jurisdictions, including the European Union’s Corporate Sustainability Reporting Directive and California’s climate disclosure rules. In addition, legislation similar to California’s “Climate Corporate Data Accountability Act” (CA SB 253)[3] which was later amended by California Senate Bill 219[4] has been introduced in New York[5], Colorado[6], New Jersey[7], and Illinois[8] that would require companies with more than $1 billion in annual revenue and doing business in the particular state to annually report their greenhouse gas (GHG) emissions, similar to what California will require beginning in 2026.
To add to the list of considerations for companies to keep on their radar, U.S. Senator Bill Hagerty recently introduced federal legislation to “prohibit entities integral to the national interests of the United States from participating in any foreign sustainability due diligence regulation, including the Corporate Sustainability Due Diligence Directive of the European Union”.[9] While Senator Hagerty’s bill appears to be symbolic and unlikely to be enacted, it has a private right of action that could prove troublesome if the legislation should be enacted.
[1] See, Press Release 2025-58, Securities and Exchange Commission, “SEC Votes to End Defense of Climate Disclosure Rules” (March 27, 2025), https://www.sec.gov/newsroom/press-releases/2025-58.
[2] Securities and Exchange Commission, Final Rule “The Enhancement and Standardization of Climate-Related Disclosures for Investors,” 17 CFR 210, 229, 230, 232, 239, and 249, adopting release available at https://www.sec.gov/files/rules/final/2024/33-11275.pdf.
[3] Cal. Health & Safety Code § 38532.
[4] Senate Bill 219, Greenhouse gases: climate corporate accountability: climate-related financial risk, Cal. Health & Safety Code §§ 38532, 38533, Bill Text available at https://leginfo.legislature.ca.gov/faces/billTextClient.xhtml?bill_id=202320240SB219.
[5] New York Senate Bill S3456, “Climate Corporate Accountability Act,” available at https://www.nysenate.gov/legislation/bills/2025/S3456.
[6] Colorado House Bill 25-1119, “A Bill for an Act concerning requiring certain entities to disclose information concerning greenhouse gas emissions,” available at https://leg.colorado.gov/bills/HB25-1119.
[7] New Jersey Senate Bill 4117, “Climate Corporate Data Accountability Act,” available at https://legiscan.com/NJ/text/S4117/2024.
[8] Illinois House Bill, “Climate Corporate Accountability Act,” available at https://www.ilga.gov/legislation/BillStatus.asp?DocNum=3673&GAID=18&DocTypeID=HB&LegId=162463&SessionID=114&GA=104.
[9] Senate Bill 985, 119th Congress (2025-2026), ‘‘Prevent Regulatory Overreach from Turning Essential
Companies into Targets Act of 2025’’ or the ‘‘PROTECT USA Act of 2025,’’ Bill Text available at https://www.hagerty.senate.gov/wp-content/uploads/2025/03/HLA25119.pdf
El-Husseiny v Invest Bank – Expanding Office Holder Claims? (UK)
S423 of the Insolvency Act 1986 (IA 1986) provides a route for office holders to challenge transactions where a person deliberately transfers assets at an undervalue to put them beyond the reach of creditors. The Supreme Court in El-Husseiny and another (Appellants) v Invest Bank PSC (Respondent) [2025] UKSC 4 recently confirmed what is meant by “transaction” in the context of s423 – and that the same meaning should be given to “transactions” caught by s238 and s339 of the IA 1986.
Claims under s423 can be more difficult to establish than claims under s238 of the IA 1986 because although both claims require there to have been a transaction at an undervalue (or for no consideration) s423 also requires an office holder to prove that there was an intention to put assets beyond the reach of creditors. An office holder is therefore more likely to bring a claim under s238 than s423, and for that reason, this judgment is helpful because it broadens the types of transactions that might fall within the definition of “transaction”.
Transaction is defined in s436 to include “a gift, agreement or arrangement” and the Supreme Court was not prepared to restrict the meaning of this and decided that a “transaction” includes assets not directly legally or beneficially owned by the debtor.
It is helpful to know the facts of this case to give some context to the particular transaction the court had to consider.
Facts and Decision
The s423 claim was brought in this case by Invest Bank in their capacity as a creditor of the appellants’ father, Mr Mohammad El-Husseini (not as an officeholder – but the findings apply equally to office holder claims).
Invest Bank had successfully obtained a judgment against Mr El-Husseini in Abu Dhabi for circa £20m, and they identified UK based assets against which they could enforce the judgment. Invest Bank argued Mr El-Husseini had transferred assets (most notably a property in London) to put them beyond the reach of Invest Bank.
While there were multiple assets caught by the s423 claim, the judgment focused on the transfer of the London property.
Before the London Property was transferred, it was legally and beneficially owned by a Jersey company, Marquee Holdings Limited (“Marquee”). It was worth about £4.5 million. At the time of the transfer, Mr El-Husseini was the beneficial owner of all the shares in Marquee.
Mr El-Husseini arranged with one of his sons, Ziad Ahmad El-Husseiny (“Ziad”), that he would cause Marquee to transfer the legal and beneficial ownership of the London property for no consideration.
In June 2017, Mr El-Husseini caused Marquee to transfer the legal and beneficial title to the London property to Ziad. Ziad did not pay any money or provide any other consideration either to Marquee or to Mr El-Husseini in return for the London Property.
The effect of the transfer was that Mr El-Husseini’s shareholding in Marquee was now significantly reduced, prejudicing Invest Bank’s ability to enforce its judgment against him.
The issue on appeal was whether s423 could apply to a transaction such as this – where a debtor procures a company which he owns to transfer a valuable asset owned by the company for no consideration or at an undervalue which has the effect of reducing or eliminatating the value of the debtor’s shareholding in the company, or whether such a transaction is not caught because the debtor does not personally own the asset.
The court at first instance held that the fact that the London property was not directly owned by Mr El-Husseini did not prevent the arrangement being a “transaction” for the purposes of s423. The point was appealed, and the Court of Appeal agreed with findings of the court at first instance. Ultimately as the issue raised an important point of statutory construction the Supreme Court considered the point and judgment was given.
The Supreme Court upheld the findings of the High Court and the Court of Appeal regarding the meaning of a “transaction”. The language and purpose of s423(1) is not confined to dealing with an asset that is legally or beneficially owned by the debtor but extends to this type of transaction. Restricting transactions to those that directly involve property owned by a debtor would not only require an implied restriction to be read into the provision but doing that would also seriously undermine the purpose of s423.
Concluding Comments
Despite the Bank’s claim not succeeding in this case (it was unable to demonstrate that Mr El- Husseini had the requiste intention when transferring the London property), the decision is nonetheless helpful to insolvency practitioners, as it confirms the wide meaning of the word “transaction” within s423, s238 and s339.
It also helpfully confirms that a debtor does not need to legally or beneficially own an asset for a transaction to be caught under those provisions. The most obvious example where this is likely to be the case is in situations such as those considered in this case – where a debtor owns shares in a company and causes that company to transfer valuable assets thereby reducing the value of the shareholding.
ICO Fines Advanced Computer Software Group £3 Million Following Ransomware Attack
On March 27, 2025, the UK Information Commissioner’s Office (“ICO”) announced that it had issued a fine against Advanced Computer Software Group (“Advanced”) for £3.07 million (approx. $4 million) for non-compliance with security rules identified through an investigation following a ransomware attack which occurred in 2022.
The ICO’s investigation found that personal data belonging to 79,404 people was compromised, including details of how to gain entry into the homes of 890 people who were receiving care at home. According to the ICO, hackers accessed certain systems of a group subsidiary via a customer account that did not have multi-factor authentication. The ICO also noted that it was widely reported that the security incident let to the disruption of critical services. The ICO concluded that the group subsidiary had not implemented adequate technical and organization measures to keep its systems secure.
Initially, the ICO intended to issue a higher fine against Advanced. However, it took into consideration Advanced’s proactive engagement with the UK National Cyber Security Centre, the UK National Crime Agency and the UK National Health Service in the wake of the attack, along with other steps taken to mitigate the risk to those impacted. The final fine represents a voluntary settlement agreed between the ICO and Advanced.
Maritime Chokepoints and Freedom of Navigation The US Federal Maritime Commission Investigation Into “Transit Constraints”
On March 14, 2025, the US Federal Maritime Commission (FMC) announced the initiation of a nonadjudicatory investigation into transit constraints at international maritime “chokepoints.”
The Federal Register notice initiating the investigation identified the following seven global maritime passageways that may be subject to such constraints: (1) the English Channel, (2) the Malacca Strait, (3) the Northern Sea Passage, (4) the Singapore Strait, (5) the Panama Canal, (6) the Strait of Gibraltar and (7) the Suez Canal. The FMC announcement is another sign of the continued merger of national security, trade issues and global shipping and transportation issues.
The FMC has a statutory mandate to monitor and evaluate conditions affecting shipping in US foreign trade. 46 U.S.C.42101(a) provides that the commission “shall prescribe regulations affecting shipping in foreign trade … to adjust or meet general or special conditions unfavorable to shipping in foreign trade,” when those conditions are the result of a foreign country’s laws or regulations or the “competitive methods, pricing practices, or other practices” used by the owners, operators or agents of “vessels of a foreign country.” The FMC is also required under 46 U.S.C. 46106 to report to Congress on potentially problematic practices of ocean common carriers owned or controlled by foreign governments, e.g., China. The FMC will conduct this investigation in accordance with its procedures for a nonadjudicatory investigation set forth in 46 CFR Part 502, Subpart R.
The FMC is conducting this investigation into any actions by a foreign country or other maritime interests that might constitute anticompetitive practices, irregular pricing or pricing that is deemed prejudicial to US foreign trade interests, and any other practices of government authorities, vessel owners, operators or agents affecting transit through such passageways. That is an incredibly broad mandate, and there is complete uncertainty as to what “remedies” or “proposed actions” the FMC might recommend so as to remediate any perceived constraints on transit.
However, given the potentially severe and disruptive impact of the proposed actions currently being considered by the Office of the US Trade Representative (USTR) in relation to the ongoing Section 301 investigation into “China’s Targeting of the Maritime, Logistics, and Shipbuilding Sectors for Dominance,” 1 this new FMC investigation bears careful monitoring and engagement by affected parties.
Some commentators have already concluded that this new FMC investigation is simply a new front in the trade war the US is waging on the Chinese maritime and shipbuilding industries. Seatrade Maritime News claims that the FMC investigation is “not about trade at all,” but rather a continuation of the “China witch hunt” that started with the USTR Section 301 investigation.2 Others see the inclusion of the Panama Canal in the FMC investigation as an extension of the Trump administration’s stated desire to “take back” the canal, although in truth, the recent controversy over the Panama Canal was in part related again to China, and concerns over the involvement of the Panama Ports Company, a subsidiary of Hong Kong-based Hutchison Port Holdings.3 The references in the FMC notice of initiation to “other maritime interests” and “other practices of government authorities,” including irregular pricing or “pricing that is deemed prejudicial to US foreign trade interests,” appear to be a veiled reference to the Panama Maritime Authority and allegations that US vessels were being treated differently. Most commentators now agree that the FMC investigation is another element or tool that the administration intends to use to reduce US reliance on foreign-owned cargo vessels, and indeed force cargo interests to use US vessels.4 In this context, the focus on the Suez Canal may actually be a US ploy to target and extract concessions out of Egypt;5 the English Channel may be more about targeting the UK and France.
The FMC summarizes its individual concerns about (1) the English Channel, (2) the Malacca Strait, (3) the Northern Sea Passage, (4) the Singapore Strait, (5) the Panama Canal (6) the Strait of Gibraltar, and (7) the Suez Canal in the Federal Register notice. In summary, the concerns range from congestion, limited passing opportunities, an elevated risk of collisions, navigational challenges, variable weather conditions, environmental risks, geopolitical tensions, security threats and, in some areas, piracy and smuggling.
With respect to the Northern Sea Passage, the FMC notes that this is emerging as a critical maritime chokepoint as the region’s waters become ice free for longer periods, with it offering a shortcut between Europe and Asia 6. Reference is made to Russia seeking control over the route and its strategic importance being amplified by increased military activity from Russia, China and NATO forces.
In the section on the Panama Canal, while noting that Panama’s ship registry is one of the world’s largest, the FMC notes that remedial measures it can take include “refusing entry to US ports by vessels registered in countries responsible for creating unfavorable conditions.” In addition to Panama, states that control other areas in which chokepoints are located operate some of the world’s other largest ship registries, such as Singapore, Malaysia and Indonesia. If this investigation leads to the US refusing entry to, or imposing penalties on, vessels flagged in these states, or on vessels owned by interests from these states, it could have very farreaching implications.
As is foreseen in the impact of the Section 301 proposed actions, these measures could have the potential to significantly raise the costs of calling at US ports (either by way of reduced availability of tonnage or the imposition of direct penalties) with these costs being passed down the charterparty chain and then ultimately to customers and consumers.
The FMC notes that other significant constraints affecting US shipping may arise quickly in the global maritime environment. For example, when the Singapore-flagged containership Dali struck a bridge in Baltimore, Maryland in March 2024, six people were killed and maritime access to the Port of Baltimore was blocked, a situation that persisted for many weeks and led to losses that have been estimated to reach as high as US$4 billion.
Interested parties are permitted to submit written comments by May 13, 2025, with experiences, arguments and/or data relevant to the above-described maritime chokepoints, particularly concerning the effects of laws, regulations, practices or other actions by foreign governments, and/or the practices of owners or operators of foreign-flag vessels, on shipping conditions in these chokepoints.
The FMC states that it welcomes comments not only from government authorities and container shipping interests, but also from tramp operators, bulk cargo interests, vessel owners, individuals and groups with relevant information on environmental and resource-conservation considerations, and anyone else with relevant information or perspectives on these matters.
In particular, the FMC has expressed an interest in information and perspectives on the following six questions:
What are the causes, nature and effects, including financial and environmental effects, of constraints on one or more of the maritime chokepoints described above?
To what extent are constraints caused by or attributable to the laws, regulations, practices, actions or inactions of one or more foreign governments?
To what extent are constraints caused by or attributable to the practices, actions or inactions of owners or operators of foreign-flag vessels?
What will likely be the causes, nature and effects, including financial and environmental effects, of any continued transit constraints during the rest of 2025?
What are the best steps the FMC might take, over the short term and the long term, to alleviate transit constraints and their effects?
What are the obstacles to implementing measures that would alleviate the above transit constraints and their effects, and how can these be addressed?
It will be interesting, and indeed imperative, for global shipping interests to monitor the comments received and how the proposed measures are developed accordingly.
A recent Bloomberg News article went so far as to indicate that the “Billion-Dollar US Levies on Chinese Ships Risk a ‘Trade Apocalypse’.”
Interestingly, there are some notable exclusions from the list of the seven “chokepoints,” including some that are significantly more problematic and/or more important to global trade flows, including the Black Sea and the Bosphorus, the Strait of Hormuz, and the Bab Al Mandeb Strait.
The Carnegie Endowment for International Peace published a February 19, 2025 article examining the US motivations behind the Panama Canal gambit.
TradeWinds posits in one article that the FMC may try to ban or detain ships from the “maritime chokepoint” countries, or restrict or ban service to the US by shipping lines or vessel operators that are said to contribute to issues relating to transit through these passageways.
For example, this may be about the US getting preferential deals for US vessels; e.g., US-flagged vessels being given free Suez transits by the Egyptian government, under threat of measures against Egypt being imposed if not.
Although consultant Darron Wadey at Dynaliners in the Netherlands has expressed a view, quoted in Seatrade Maritime News, that this route is “an outlier” in the list and has “zero relevance” to US foreign trade.
Judge Blocks DHS Secretary Noem’s Termination of Venezuelan TPS
Recission of Temporary Protected Status (TPS) for approximately 350,000 Venezuelans has been halted temporarily. U.S. District Court Judge Edward Chen’s Order applies to Venezuelans who registered for TPS under the Oct. 3, 2023, designation of Venezuela for TPS. National TPS Alliance, et al. v. Noem, et al., No. 25-cv-01766 (N.D. Cal. Mar. 31, 2025).
Before the issuance of the Order, these individuals faced the loss of their TPS-based work authorizations on April 2 and the expiration of TPS itself on April 7. They will now remain in TPS and authorized to work for the duration of the court order.
The Order gives DHS one week to file notice of appeal and the plaintiffs one week to file a motion to postpone Secretary Kristi Noem’s decision to rescind Haiti’s TPS designation, currently set to expire Aug. 3, 2025.
Judge Chen found Secretary Noem’s recission of Venezuela’s TPS designation a violation of the Administrative Procedure Act (APA) and the Equal Protection Clause of the 14th Amendment.
Judge Chen wrote that Secretary Noem’s recission of Venezuela’s TPS designation “threatens to: inflict irreparable harm on hundreds of thousands of persons whose lives, families, and livelihoods will be severely disrupted, cost the United States billions in economic activity, and injure public health and safety in communities throughout the United States.”
He stated that DHS had failed to identify any “real countervailing harm in continuing TPS for Venezuelan beneficiaries” and that plaintiffs will likely succeed in showing that Secretary Noem’s decision is “unauthorized by law, arbitrary and capricious, and motivated by unconstitutional animus.”
The Order does not address Secretary Noem’s Mar. 25, 2025, announcement that humanitarian parole, and related work authorizations, for citizens of Cuba, Haiti, Nicaragua, and Venezuela (also known as the CHNV program) will expire on April 24, 2025, or the expiration date of individuals’ humanitarian parole, whichever occurs first.
Navigating the Termination of CHNV Parole Programs: Insights on I-9 Reverification and INA Compliance for Employers
On March 25, 2025, the Department of Homeland Security (DHS) announced the termination of the parole processes for citizens or nationals of Cuba, Haiti, Nicaragua, and Venezuela (CHNV parole programs). This decision will affect employers who must navigate the employment eligibility of affected individuals while ensuring compliance with anti-discrimination provisions outlined in the Immigration and Nationality Act (INA). The termination of these programs means that any parole status and employment authorization derived through CHNV parole programs will end by April 24, 2025. Employers must take steps to manage the reverification of affected employees’ employment eligibility without engaging in discriminatory practices.
Understanding the Challenges
As part of the CHNV parole programs, employment authorization documents (EADs) issued to beneficiaries bear the category code (C)(11). However, this code is not exclusive to CHNV beneficiaries, making identification difficult. Additionally, some CHNV beneficiaries may have updated their Forms I-9 with EADs that have validity dates extending beyond April 24, 2025. Employers who wish to ensure compliance face a complex challenge: how to identify affected employees for reverification without inadvertently violating the INA’s anti-discrimination provisions.
Employers who complete and retain paper I-9 forms, do not keep copies of identity and employment authorization documents, and do not participate in E-Verify may find the process particularly challenging. Sorting and extracting Forms I-9 based on “Foreign Passport and Country of Issuance” in Section 1, or by identifying Forms I-9 listing EADs in Section 2, may result in List A displaying overly broad findings, as these methods may capture individuals who are not CHNV beneficiaries and who hold valid employment eligibility.
Legal Compliance Considerations
The INA’s anti-discrimination provisions, particularly 8 USC § 1324b(a)(1)(A) and (a)(6), prohibit employers from treating employees differently based on citizenship, immigration status, or national origin. Employers are also prohibited from requesting additional or different documentation from employees based on these factors. The Department of Justice’s Immigrant and Employee Rights (IER) Section, formerly the Office of Special Counsel (OSC), has emphasized that employers should avoid making employment decisions—including reverification processes—based on an employee’s citizenship, immigration status, or national origin.
In the meantime, employers should consider:
Maintaining thorough records of the reverification process to demonstrate compliance with federal requirements and anti-discrimination provisions.
Conducting internal audits to ensure that no employees are treated differently based on citizenship, immigration status, or national origin during the reverification process.
Providing training to HR personnel and compliance teams on how to handle reverification without violating INA provisions, emphasizing the importance of treating all employees consistently and fairly.
Tracking the expiration dates of employees whose employment eligibility needs to be reverified.
Notifying affected employees of their upcoming need to provide updated documentation, regardless of their citizenship or immigration status. Do not request specific documents or additional information beyond what is required.
Key Takeaways
This issue represents new territory which has not been thoroughly analyzed or reviewed to date by authorities. IER technical guidance may be forthcoming on what U.S. employers should do if a particular classification of employment eligibility is suddenly terminated by the government, but some beneficiaries in that classification have updated their Forms I-9 with employment authorization validity dates that go beyond the termination date (April 24, 2025).
EU: New European Consumer Protection Guidelines for Virtual Currencies in Video Games
On March 21, 2025, ahead of a consultation and call for evidence on the EU’s Digital Fairness Act, the Consumer Protection Cooperation (CPC) Network[1] highlighted the pressing need for improved consumer protection in the European Union, particularly regarding virtual currencies in video games. This move comes in response to growing concerns about the impact of gaming practices on consumers, including vulnerable groups such as children. The CPC Network has defined a series of key principles and recommendations aimed at ensuring a fairer and more transparent gaming environment. These recommendations are not binding and without prejudice to applicable European consumer protection laws[2] but they will likely guide and inform the enforcement of consumer protection agencies on national level across the EU.
What Are the Key Recommendations for In-Game Virtual Currency?
The CPC Network’s recommendations are designed to enhance transparency, prevent unfair practices, and protect consumers’ financial well-being. These principles are not exhaustive but cover several crucial areas:
Clear and Transparent Price Indication: The price of in-game content or services must be shown in both in-game currency and real-world money, ensuring players can make informed decisions about their purchases. (Articles 6(1)(d) and 7 of the UCPD, and Article 6 (1) (e) of the CRD)
Avoiding Practices That Obscure Pricing: Game developers should not engage in tactics that obscure the true cost of digital content. This includes practices like mixing different in-game currencies or requiring multiple exchanges to make purchases. The goal is to avoid confusing or misleading players.(Articles 6 (1) (d) and 7 of the UCPD, and Article 6 (1) (e) of the CRD)
No Forced Purchases: Developers should not design games that force consumers to spend more money on in-game currencies than necessary. Players should be able to choose the exact amount of currency they wish to purchase.(Articles 5, 8 and 9 of the UCPD)
Clear Pre-Contractual Information: Prior to purchasing virtual currencies, consumers must be given clear, easy-to-understand information about what they are buying. This is particularly important for ensuring informed choices.(Article 6 of the CRD)
Respecting the Right of Withdrawal: Players must be informed about their right to withdraw from a purchase within 14 days, particularly for unused in-game currency. This is crucial for ensuring consumers’ ability to cancel transactions if they change their mind.(Articles 9 to 16 of the CRD)
Fair and Transparent Contractual Terms: The terms and conditions for purchasing in-game virtual currencies should be written clearly, using plain language to ensure consumers fully understand their rights and obligations.(Article 3 (1) and (3) of the UCTD)
Respect for Consumer Vulnerabilities: Game developers must consider the vulnerabilities of players, particularly minors, and ensure that game design does not exploit these weaknesses. This includes providing parental controls to prevent unauthorized purchases and ensuring that any communication with minors is carefully scrutinized.(Articles 5-8 and Point 28 of Annex I of the UCPD)
These principles reflect the growing concern by European regulators of exploitation of consumers, particularly vulnerable groups such as children, in the gaming world. The European Consumer Organisation (BEUC) has strongly supported these measures, which aim to provide a safer, more transparent gaming experience for players.
Enforcement Actions and Legal Proceedings
On the same day, coordinated by the European Commission the CPC Network initiated legal proceedings against the developer of on online game. This action, driven by a complaint from the Swedish Consumers’ Association, addresses concerns about the company’s marketing practices, particularly those targeting children. Allegations include misleading advertisements urging children to purchase in-game currency, aggressive sales tactics such as time-limited offers, and a failure to provide clear pricing information.
A Safer Gaming Future
This enforcement action, along with the introduction of new principles, is part of the European Commission’s stated objective to ensure better consumer protection within the gaming industry. The Commission aims to emphasize the importance of transparency, fairness, and the protection of minors within gaming platforms.
What Should Video Game Companies and Gambling Operators Do Next?
In light of these new developments, video game companies and gambling operators especially those offering virtual currencies are well advised to review their practices to ensure ongoing compliance with existing EU consumer protection laws.
Failure to align with the above principles does not automatically mean that consumer laws are infringed but as the recent enforcement action shows could result in investigations and enforcement actions under the CPC Regulation or national laws. If gaming content is available across multiple EU countries, a coordinated investigation may be triggered, with the possibility of fines up to 4% of a company’s annual turnover.
To further support the industry, the European Commission is organising a workshop to allow gaming companies to present their strategies for aligning with the new consumer protection standards. This will provide a valuable opportunity for companies to share their plans and address any concerns related to these proposed changes. If you would like to know more, please get in touch.
FOOTNOTES
[1] The CPC Network is formed by national authorities responsible for enforcing EU consumer protection legislation under the coordination of the European Commission.
[2] Reference is made to Directive 2005/29/EC of the European Parliament and of the Council of 11 May 2005 on unfair commercial practices (UCPD); the Directive 2011/83/EU of the European Parliament and of the Council of 25 October 2011 on consumer rights (CRD); the Directive 93/13/EEC of 5 April 1993 on unfair terms in consumer contracts (UCTD).
EC Begins Public Consultation on Upcoming EU Bioeconomy Strategy
The European Commission (EC) began a public consultation on March 31, 2025, on the upcoming European Union (EU) Bioeconomy Strategy. The EC states in its March 31, 2025, press release that the Strategy “marks a significant step forward in harnessing the opportunities of the bioeconomy to support European businesses and drive progress towards the EU’s environmental, climate and competitiveness objectives.” According to the call for evidence, the Strategy’s main aims include:
Ensuring the long-term competitiveness of the EU bioeconomy and investment security. The Strategy will identify measures to scale up and commercialize existing and emerging biotechnology solutions and biobased products, in particular by tapping into the significant growth potential of biobased materials substituting fossil-based ones (e.g., sources of alternative proteins, biobased materials, or biochemicals). It will entail looking at practical measures to remove unnecessary barriers to biobased manufacturing and bio-innovation and unleash the full opportunities of primary biobased production;
Increasing resource-efficient and circular use of biological resources, by creating an efficient demand. This means transforming how the EU values and uses biomass resources, prioritizing extended high-value applications while encouraging industries and consumers to embrace circular practices that maximize economic returns from each unit of biomass. It might also entail providing targeted support and incentives for higher value added uses of biomass feedstock and by-products in line with the cascading principle;
Securing the competitive and sustainable supply of biomass, both domestically and from outside the EU. The Strategy will strengthen the role of primary producers, generating wealth in rural areas by creating jobs and diversifying incomes for foresters and farmers and rewarding them for the preservation of ecosystems; and
Positioning the EU in the rapidly expanding international market for biobased materials, biomanufacturing, biochemicals, and agri-food and biotechnology sectors. This will be done by steering existing foreign policy mechanisms in the area of the bioeconomy in the context of the EU’s Global Gateways initiative, exploring the need and appropriateness of bringing bioeconomy under international multilateral fora, and promoting green diplomacy on bioeconomy.
The EC encourages all stakeholders to participate in the online consultation. Comments are due June 23, 2025. Stakeholders can also contribute by participating in targeted sessions on the bioeconomy in upcoming events such as the European Circular Economy Stakeholder Platform (ECESP) Circular Economy Stakeholder Dialogue, taking place on April 10, 2025, and EU Green Week, taking place from June 3 to 5, 2025.
UK Grid Connection Reforms: Breaking the Bottleneck
Go-To Guide:
The UK is transforming its grid connection system to address a backlog of over 739 GW of projects, aiming to streamline access and reduce delays.
New reforms focus on prioritizing projects that are ready for development and essential for grid stability, eliminating the speculative applications.
A structured gate-based queue process would be implemented, requiring projects to meet specific criteria to secure grid connection.
NESO has temporarily paused new grid connection applications pending reform implementation, with certain exceptions.
Investors and lenders may prioritize projects with secured grid access, potentially impacting valuations and project economics.
The UK’s grid connection system is undergoing its most significant transformation in decades. With 739 GW of projects stuck in the queue and over 1,700 new applications in 2023 and 2024 alone, the system has hit a breaking point, clogging the project pipeline and causing years-long delays.
Recognizing the urgency, the National Energy System Operator (NESO) introduced reforms to cut through the backlog and bring order to the chaos. These changes, now under review by the Office of Gas and Electricity Markets (Ofgem), are designed to prioritise viable projects, eliminate speculative applications, and fast-track grid access.
In February 2025, Ofgem gave in-principle approval to the reforms, launching a consultation that closed on 14 March 2025. A final decision is expected by the end of Q1 2025. These reforms would reshape the UK’s energy landscape if implemented, aligning with the government’s Clean Power 2030 Action Plan (CP30 Plan).
What might this mean for businesses? Let’s break it down.
Continue reading the full GT Alert.
Winding Back the Clock: CFTC Withdraws Controversial SEF Registration Staff Letter
The Division of Market Oversight (DMO) of the Commodity Futures Trading Commission (CFTC) has withdrawn its previous staff advisory letter on swap execution facility (SEF) registration requirements (Letter 21-19).
Published on March 13, CFTC’s staff letter 25-05 (Letter 25-05) withdrew Letter 21-19 due to DMO’s understanding that it “created regulatory uncertainty” regarding whether certain entities operating in the swaps markets were required to register as SEFs. Letter 21-19 was therefore withdrawn with immediate effect.
The withdrawal of Letter 21-19 has removed what was seen by many parts of the swaps industry as a problematic widening of the interpretation of SEF regulatory requirements, which was difficult to apply and raised more questions than it answered.
A Look Back at Letter 21-19 and SEF Registration Requirements
Letter 21-19 was published in September 2021 as a “reminder” for entities of the SEF registration requirements under the Commodity Exchange Act (CEA). The entities specifically in scope of the remainder were those: (1) facilitating trading or execution of swaps through one-to-many or bilateral communications; (2) facilitating trading or execution of swaps that are not subject to the trade execution requirement under the CEA; (3) providing non-electronic means for the execution of swaps; or (4) falling within the SEF definition and operated by an entity currently registered with the CFTC in some other capacity, such as a commodity trading advisor (CTA) or an introducing broker.
In relation to the first set of entities (i.e., facilities offering one-to-many or bilateral communications), the CEA defines a SEF as, in relevant part, “a trading system or platform in which multiple participants have the ability to execute or trade swaps by accepting bids and offers made by multiple participants in the facility or system.” Prior to Letter 21-19, the wider swaps industry had interpreted this as multiple-to-multiple trading; in other words, two or more market participants interacting with two or more other market participants to execute swaps. Letter 21-19 drastically increased the scope of such SEF requirement, however, by providing that the multiple-to-multiple trading requirement could be met even if (1) the platform only allows bilateral or one-to-one communications; and (2) multiple participants cannot simultaneously request, make, or accept bids and offers from multiple participants. DMO went on to express its view that a one-to-many system or request for quote (RFQ) system would satisfy the multiple-to-multiple requirement if more than one participant were able to submit an RFQ on the platform.
Letter 21-19 coincided with the CFTC’s settlement of an enforcement action with Symphony Communication Services, LLC (Symphony) for failure to register as a SEF. The CFTC found that Symphony had operated a multiple-to-multiple platform by operating a communications platform that allowed participants to send RFQ messages to multiple other market participants. Subsequently, the CFTC also relied on Letter 21-19 when it issued an order against Asset Risk Management, LLC, a registered CTA, for failing to register as a SEF.
What is the Cross-Border Impact
The potential relaxation of the SEF registration scope in the United States stands in contrast to similar regimes in the EU and the UK. The European Securities and Markets Authority (ESMA) and the UK’s Financial Conduct Authority (FCA) each published guidance in 2023, similar to Letter 21-19, which focused on the registration requirements for multilateral platforms. However, there are no signs that the EU or UK regulatory guidance will be amended. Technology service providers and trading venues may, therefore, wish to reconsider their cross-border service offerings in light of Letter 25-05 and the differing positions in the EU and UK.
Letter 21-19 is available here and Letter 25-05 is available here.
China Regulator Proposes Amendments to Cybersecurity Law
On March 28, 2025, the Cyberspace Administration of China issued draft amendments to China’s Cybersecurity Law (“Draft Amendment”) for public comment until April 27, 2025. The Draft Amendment aims to harmonize relevant provisions of the Personal Information Protection Law (“PIPL”), Data Security Law (“DSL”) and Law of Administrative Penalties, all of which were issued after the Cybersecurity Law came into effect in 2021.
The Draft Amendment amends the liability provisions of the Cybersecurity Law as follows:
Legal liability for network operation security: (1) classifies massive data leakage incidents, loss of partial functions of critical information infrastructure (“CII”) and other serious consequences that jeopardize network security as violations of the Cybersecurity Law and increases the range of fines set forth in the DSL for such violations; (2) imposes liability for the sale or provision of critical network equipment and specialized cybersecurity products that do not meet the Cybersecurity Law’s requirements for security certification and security testing; and (3) clarifies penalties for CII operators that use network products or services that have either not undergone or passed security review.
Legal liability for security of network information: (1) increases the penalty range for failure to report to the competent authorities, or failure to securely dispose of, information that is prohibited by applicable law to be published or transmitted; and (2) clarifies penalties for violations of the Cybersecurity Law that have particularly serious impacts and consequences.
Legal liability for security of personal information and important data: Amends the Cybersecurity Law to incorporate the PIPL’s and DSL’s penalty structure for violations of the law involving the security of personal information and other important data.
Mitigation of penalties: Adds provisions to mitigate, alleviate or withhold penalties for violations of the Cybersecurity Law where: (1) the network operator eliminates or mitigates the harmful consequences of the violation; (2) the violation is minor, timely corrected and does not result in harmful consequences; or (3) it is a first time violation that is timely corrected and results in minor harmful consequences. The Draft Amendment also clarifies that the competent authorities are responsible for formulating the corresponding benchmarks for administrative penalties.
And Just Like That Another Restructuring Plan Is Sanctioned with HMRC Supporting (UK)
The Outside Clinic restructuring plan (RP) was sanctioned last week with HMRC voting in favour of it. In a similar vein to Enzen (see our earlier blog) HMRC initially indicated that it was not inclined to support the plan, but, after negotiating a higher return following the convening hearing, it voted in favour of it. A somewhat different outcome in circumstance where HMRC had (prior to the company proposing a plan) instructed its solicitors to present a winding up petition after attempts to agree a time to pay agreement had failed.
HMRC’s engagement and support is welcome (as it is on any restructuring), but the outcome in both this case, and Enzen, should not be taken as a green light that HMRC’s support is guaranteed – much will depend on the terms of the plan.
Under the terms of the Outside Clinic RP as originally proposed, HMRC would have received a dividend of 5p in the £ in respect of its secondary preferential claims of c£1.45m, compared to nil in the relevant alternative. HMRC would also have been treated the same as other unsecured creditors who also were to receive 5p in the £.
Following the convening hearing, HMRC flagged a number of concerns which the plan company had to address not least
Whether the “no worse off” test could be satisfied – with concern about the recoverability of receivables/book debts which (if the assumptions were wrong) could see a different return in the alternative (an argument we saw in opposition to the plan proposed by the Great Annual Savings company); and
HMRC’s treatment compared to other creditors (as noted above the plan originally proposed to treat HMRC in the same way as unsecured creditors)
HMRC’s improved position seems to have come about partly as a result of the plan company subsequently acknowledging that HMRC is an involuntary creditor and that it has a role to play as collector of taxes.
Perhaps more will come from the judgments on both this case and Enzen, but the key takeaways at the moment are that a plan company must (a) recognise that HMRC is an involuntary creditor and (b) its role in collecting taxes – something that reflects HMRC guidance too.
If HMRC’s status is recognised in a plan perhaps HMRC will support from the outset, especially so given HMRC’s new stated policy is “to participate as fully as possible in plans – which will include, when necessary and desirable, negotiating with plan companies on HMRC’s return under a restructuring plan”.