Category: Global

ESMA Releases Final Draft RTS and Guidelines on Liquidity Management

ESMA Guidelines and Final Draft RTS on Liquidity Management Tools of UCITS and Open-Ended AIFs
Pursuant to the revised Directive 2011/61/EU (AIFMD) and Directive 2009/65/EC (UCITS Directive), the European Securities and Markets Authority (ESMA) was tasked with developing guidelines on the selection and calibration of liquidity management tools (LMTs) and developing regulatory technical standards (RTS) to determine the characteristics of LMTs available to managers of alternative investment funds (AIFs) (AIFMs) and of undertakings for collective investment in transferable securities (UCITS) (UCITS ManCos). On the back of this mandate, ESMA published a consultation paper (CP) on the draft guidelines and RTS. 
The consultation period closed on 8 October 2024, with ESMA receiving 33 responses. Taking into account this stakeholder feedback, on 15 April 2025, ESMA published (i) its final report on the Guidelines on LMTs of UCITS and open-ended AIFs (the Guidelines) and (ii) its final report on the draft Regulatory Technical Standards on Liquidity Management Tools under the AIFMD and UCITS Directive. 
Final Report on Guidelines on LMTs of UCITS and Open-Ended AIFs
On the back of feedback received during the consultation, ESMA made a number of changes to the Guidelines, deleting several sections that were previously included in the CP and amending other sections to provide more flexibility to AIFMs and UCITS ManCos. The Guidelines were also streamlined to avoid any overlaps with the RTS and the text contained in the AIFMD and UCITS Directive. Notable deletions from the Guidelines include:

The guideline on governance principles, which previously stated that fund managers should develop an LMT policy which should document the conditions for the selection, activation and calibration of LMTs, and an LMT plan.

ESMA noted that the majority of stakeholder feedback highlighted that the LMT policy should be kept as an internal guidance document, and on the basis that the AIFMD and UCITS Directive already contain provisions mandating the implementation of policies and procedures for the activation and deactivation of LMTs and operational and administrative arrangements, ESMA deleted the sections of the Guidelines dedicated to the governance principles. 

The guideline on disclosure to investors, which mandated managers to provide disclosure to investors on the selection, activation and calibration of LMTs in the fund documentation, rules or instruments of incorporation, prospectus or periodic reports.

ESMA noted that notwithstanding the fact that the majority of stakeholders supported the principle of improving transparency to investors, they stressed the importance to strike the balance between appropriate disclosure, investor protection and unintended consequences. On the back of this, ESMA decided not to retain these sections of the Guidelines, but noted that managers should nonetheless be cognisant of the LMT disclosure obligations set down in the AIFMD and UCITS Directive for example, that a description of the AIF’s liquidity risk management shall be made available to investors by the AIFM. 

Certain other restrictive guidelines, including those that imposed more restrictive obligations on the selection, activation and calibration of LMTs, as it was noted that these guidelines limited the sole responsibility of the manager as prescribed by the AIFMD and UCITS Directive. 

In contrast, ESMA retained certain guidelines that had previously been pushed back on by stakeholders including the guideline whereby managers should consider, where appropriate, the merit of selecting at least one quantitative LMT and at least one anti-dilution tool. While retaining this guideline, ESMA stressed that it is without prejudice to the ultimate responsibility of the manager for the selection of LMTs, including, where appropriate, redemptions in kind. 
In light of the consultation feedback, ESMA noted that it has opted against a restrictive approach in the final Guidelines, instead emphasising the manager’s sole responsibility for selecting and implementing LMTs. 
Draft Regulatory Technical Standards on Liquidity Management Tools Under the AIFMD and UCITS Directive
As was the case with ESMA’s final report on the Guidelines, ESMA, on the back of feedback received from stakeholders, made a number of updates to the draft RTS, in particular to make several changes and clarifications with regard to redemption gates, and also to remove the requirement to apply the same rules to all share classes. 
Taking into account feedback from stakeholders, ESMA introduced flexibility in the way in which the activation threshold for redemption gates of AIFs can be expressed. The RTS for AIFs now stipulate that the thresholds can be expressed: (i) as a percentage of the net asset value (NAV) of the AIF, (ii) in a monetary value (or a combination of both), or (iii) as a percentage of liquid assets. For UCITS however, ESMA retained the existing language regarding activation thresholds in that they shall only be expressed as a percentage of the NAV of the UCITS. In addition to this, ESMA introduced an alternative method for the application of redemption gates for AIFs and UCITS under which redemption orders below or equal to a pre-determined redemption amount can be fully executed while redemption orders above this amount are subject to the redemption gate. This mechanism, ESMA explained, should serve to avoid small redemption orders being affected by large orders that drive the amount of redemptions above the activation threshold. 
In addition, the draft RTS previously included provisions requiring the same level of LMTs to be applied to all share classes, however, given that the mandate of the RTS did not support the development of specific and comprehensive application of LMTs to share classes, these provisions have been removed. 
Finally, stakeholder feedback alerted ESMA of the unintended consequences of the rules on redemption in kind for the functioning of the primary market of exchange-traded funds (ETFs). On the back of this, ESMA included a new provision in the UCITS RTS clarifying that the rule on pro-rata approach in the case of redemption in kind did not apply to authorised participants and market makers operating on the primary market of ETFs. 
What Comes Next?
In terms of next steps, the final draft RTS have been submitted to the European Commission (the EC) for adoption and the EC have three months (which can be extended by one further month), to make a decision. The Guidelines shall start to apply on the date of entry into force of the RTS. Funds that existed before the entry into force of the RTS shall have 12 months to comply with the Guidelines. 

Central Bank Fitness & Probity Consultation and Updates – April 2025

Following the 2024 independent review by Mr Andrea Enria (former Chair of the European Central Bank Supervisory Board) of the Central Bank of Ireland’s Fitness & Probity (F&P) assessment process, the Central Bank has published a report outlining the progress made on implementing Mr. Enria’s 12 recommendations and launched a consultation on proposed revisions it its F&P regime.
Report on Implementation of Recommendations
The report details the actions taken to date by the Central Bank to implement Mr. Enria’s recommendations across the review’s three areas of focus – (1) clarity of supervisory expectations; (2) internal governance of the process; and (3) fairness, efficiency and transparency of the process.
In response to the review’s finding that the Central Bank’s F&P standards were “fragmented across different documents and not user-friendly”, the Central Bank has proposed to update and consolidate the Central Bank’s guidance on the F&P standards into a single document.
The review also highlighted critical areas for improvement within the F&P gatekeeping process, including the need for enhanced seniority and independence in the final decision making stages. To address these gaps, the Central Bank has established a new F&P unit which has ownership of: (i) F&P gatekeeping assessment work with certain key responsibilities such as conducting assessment work across all F&P gatekeeping applications, (ii) approving F&P applications, and (iii) ensuring adherence to established process and progression of decisions in a timely manner. In addition, in cases of potential refusal, the F&P unit will now refer cases to a newly established ‘Gatekeeping Decisions Committee’ which is chaired by the Deputy Governor of Financial regulation within the Central Bank.
It was further noted that the Central Bank could make improvements to ensure that appropriate standards of fairness, efficiency and transparency are consistently achieved. To acknowledge this finding, the Central Bank has published an assessment process document which aims to codify and reflect the principle that regulatory assessments must be conducted with the utmost integrity and to ensure that applications are treated equitably.
Consultation Paper on Amendments to the Fitness and Probity Regime (CP160)
In addition to the report, the Central Bank published a consultation paper (CP160) in order to address the recommendations for increased clarity and transparency of supervisory expectations in relation to the application of the Central Bank’s F&P standards.
As part of this consultation, the Central Bank has sought feedback from stakeholders on the consolidation of and proposed enhancements to its existing guidance on the F&P standards, a draft of which is available on the Central Bank’s website (the Revised Guidance). With this Revised Guidance, the Central Bank aims to ensure industry understanding of the F&P assessment process by: (a) identifying and incorporating objective measures and role summaries for certain pre-approval controlled functions (PCFs); (b) including specific provisions on identifying, managing and mitigating conflicts of interest; (c) clarifying the way in which collective suitability and diversity within board and management teams are assessed; and (d) outlining the approach to be taken in determining the relevance of past events to an individual’s application.
The Central Bank further proposes to undertake a substantive review of PCF roles with a view to ensuring that the level of Central Bank gatekeeping is appropriate however, due to the fact that the list of PCF roles is embedded in the Senior Executive Accountability Regime Regulations, which is in its early stages of introduction, the Central Bank plans to defer this review to 2027. In the meantime however, the Central Bank has proposed to remove the sector specific categorisations so that there will be one list of PCFs applying to all regulated firms (other than Credit Unions).
Submissions to the consultation can be made via [email protected] until 10/07/2025.

The Latest OFSI Property and Related Services Threat Assessment

The United Kingdom’s Office of Financial Sanctions Implementation (OFSI) has published a report detailing suspected breaches of UK financial sanctions involving UK property and related services firms since February 2022 and ongoing threats to sanctions compliance (the Assessment). 
Why Did OFSI Focus on Property and Related Services?
Under the United Kingdom’s financial sanctions regime, property is an “economic resource”. Individuals and entities designated by OFSI (DPs) are prohibited from using UK financial services to execute property transactions and may also be subject to asset freezes, which include economic resources such as property. 
Property and related services firms captured in the Assessment include UK firms and sole practitioners involved in the sale, maintenance or upkeep of properties. OFSI’s Assessment is a broad cross-sector assessment that considers a range of actors including: estate agents; letting agents; landlords; tenants; property managers; property investors; property developers; UK firms dealing with overseas properties; and overseas firms dealing with UK customers. 
OFSI confirmed that almost half of suspected breaches related to UK residential property owned or let by DPs. The remainder of suspected breaches were linked to UK commercial properties, investments into UK properties, the use of UK property firms by DPs to facilitate overseas business interests and client relationships, and the renewal or continuation of property-related contracts (including insurance) on behalf of or for the benefit of DPs.
OFSI’s Key Findings
The Assessment sets out five key findings relevant to UK property and related services firms from February 2022 to present. 
Underreporting of Breaches 
OFSI found it was almost certain that UK property and related services firms have underreported suspected breaches of financial sanctions to OFSI. OFSI also observed significant delays in the identification and reporting of suspected breaches.
Noncompliance With Licence Conditions
OFSI stated it was almost certain that DPs have breached UK financial sanctions by making or facilitating transactions for the benefit of their UK properties without or outside the scope of an OFSI licence or applicable exception (further information on OFSI licencing can be found here).
OFSI found that the vast majority of suspected breaches of licence conditions related to payments made by DPs or connected entities for the maintenance of UK properties.
Russian DPs and Their Enablers
OFSI identified the use of professional and nonprofessional “enablers” who assist DPs in concealing their beneficial ownership or control of UK properties. 
OFSI reports it was highly likely that property-related breaches of sanctions have been enabled by UK property firms facilitating the payment of household staff payments, council tax, utility bills, property maintenance services, letting services and more, without an applicable licence. This is particularly the case for small-scale property or related services firms or sole practitioners with high-risk appetites and longstanding relationships with DPs.
Family and Associates
OFSI found it was highly likely that DPs have used nonprofessional enablers, such as family and close associates, to frustrate UK financial sanctions by transferring ownership or control of property assets to family/associates to disguise beneficial ownership. Key giveaways are the use of family members of associates of DPs making payments for services relating to properties owned or controlled by a DP, e.g., through direct debits to settle insurance contracts, or for the maintenance of a property, or to pay for a subscription service at an address linked to a property. 
OFSI encourages all UK firms to report any suspicious changes to the ownership or control of property assets linked to a Russian DP, particularly when properties are considered super prime properties, i.e., at the top 5% end of the property market.
Professional Enablers
OFSI considered it was almost certain that UK property and related services firms have acted as professional enablers for DPs, thereby facilitating sanctions breaches. Since February 2022, most professional enabler activity includes concierge and personal security services, other property-management services, or lifestyle-management services. Without a relevant OFSI licence, these payments could breach UK financial sanctions.
OFSI recommends staying alert to changes in ownership or control of a DP’s property asset, particularly if it has been recently divested to a percentage below 50% to bypass the basic due diligence checks.
Intermediary Jurisdictions
The Assessment also encouraged vigilance when “red flags” arise in conjunction with an intermediary jurisdiction nexus (i.e., a jurisdiction other than the United Kingdom or the jurisdiction to which UK financial sanctions apply). The Assessment found that Russian DPs structured their financial interests through a number of intermediary jurisdictions, some of which offer greater privacy in legal and financial systems. OFSI reported that since 2022, 22% of suspected breaches involved actors in intermediary jurisdictions including: Austria, Azerbaijan, the British Virgin Islands, the Republic of Cyprus, Jersey, Guernsey, Luxembourg, Switzerland, Türkiye, the United Arab Emirates and the United States. 
Reporting
Property and related services are obliged to make Suspicious Activity Reports (SARs) to the National Crime Agency under Part 7 of the Proceeds of Crime Act 2002 and the Terrorism Act 2000 if money laundering or terrorist financing activities are known or suspected. Guidance on SARs is available here.
As of 14 May 2025, letting firms will join estate agents and other relevant firms in being required to report to OFSI if they know or have reasonable cause to suspect that a person is a DP or if a person has breached financial sanctions regulations, if the information or other matter on which the knowledge or cause for suspicion is based came to it in the course of carrying on its business. This applies regardless of the rental value of properties handled by letting agents and includes all forms of tenancies. 
Practical Steps
To ensure compliance with your reporting obligations, the following practical steps are advised:

Monitor and identify any red flags as indicated in the Assessment.
Update client due diligence beyond basic ID checks to check beneficial owners and connected parties.
Remind yourself of your specific reporting obligations under the Sanctions and Anti-Money Laundering Act 2018 by reading the guidance published by His Majesty’s Revenue and Customs.
Complete a tailored risk assessment incorporating the above findings.
Identify and comply with any applicable licence requirements.

Conclusion 
OFSI’s Assessment builds on previous and related publications issued by OFSI and UK government partners, including the Financial Services Threat Assessment published by OFSI in February 2025 (see our corresponding alert here) and the Legal Services Threat Assessment published by OFSI in April 2025 (see our corresponding alert here). 

CSRD’s ESRS Draft Work Plan Faces Rejection At Latest EFRAG Meeting

On 15 April 2025, the sustainability reporting board (“SRB”) of the European Financial Reporting Advisory Group (“EFRAG”) failed to agree to an internal timeline for delivering advice to the European Commission on the simplification of the European Sustainability Reporting Standards (“ESRS”), which is at the centre of the Corporate Sustainability Reporting Directive’s requirements.
To align with the current European Commission schedule for streamlining the corporate sustainability requirements, EFRAG was expected to deliver their work plan and internal timeline by 15 April, including a public consultation and with an end goal to provide final technical advice to the European Commission by 31 October. However, these already ambitious timelines may now be additionally squeezed.
Ten of the twenty‑five SRB members voted against the work plan which failed the qualified majority that was required for approval.
Several issues arose during the SRB meeting on the work plan, including:

The need for a more detailed and approved implementation strategy, not only a work plan.
The work plan was considered by some SRB members to require more detail and more sufficient assurance that the work plan would lead to a successful process and outcome.
There was no consensus regarding the plans for public consultation. The document indicated that EFRAG would conduct a 30‑40 day consultation “and/or” two weeks of around ten “structured public feedback outreach events”. Several SRB members emphasized that public consultation is an absolute requirement and should not be considered optional.
The tight deadlines for streamlining the ESRS were considered unrealistic by some.

The European Commission noted that they were aware of the outcome from the meeting, but the next steps from EFRAG are yet to be determined.

Webinar Recording: The European Commissions Proposals to Simplify CBAM and Reduce Administrative Burden on Importers [Video]

We recently hosted a webinar in collaboration with Carboneer, where Thomas Delille and Valerio Giovannini were joined by Simon Göß of Carboneer to discuss the European Commission’s latest proposals to simplify the Carbon Border Adjustment Mechanism (CBAM) and reduce the administrative burden on importers. Watch the recording below.
The session provided an in-depth analysis of the proposed regulatory amendments, examining their impact on compliance obligations for EU importers and the practical implications for third-country exporters. The panel also presented a case study exploring revised methodologies for estimating CBAM certificate costs, including updated data sources, forecasting demand, and pricing implications for 2026–2027. This discussion offers valuable insight for anyone involved in cross-border trade under the evolving CBAM framework.
 

China’s Supreme People’s Court Releases Typical Intellectual Property Cases in People’s Courts of 2024

On April 21, 2025, China’s Supreme People’s Court (SPC) the Typical Intellectual Property Cases in People’s Courts of 2024 (2024年人民法院知识产权典型案例). This year’s annual release includes only 8 cases and includes trade secret theft, an IP ownership dispute, copyright infringement, trademark infringement, and unfair competition. No patent infringement cases made the list this year. Typical cases are used by the SPC to promote uniformity to help ensure similar cases are treated consistently across different courts.
As explained by the SPC:

[Patent ownership dispute between Shenzhen ZhenXX Medical Technology Co., Ltd. and Shenzhen RuiXX Biotechnology Co., Ltd. and Hu]
Second instance: 最高人民法院（2023）最高法知民终871号
【Basic Facts】
Shenzhen ZhenXX Medical Technology Co., Ltd. was established in January 2018. It is a high-tech company co-founded by three entrepreneurs returning from overseas, Yu, Wang, and Hu, aiming to promote the research and development and transformation of mRNA technology in the field of biomedicine. In September 2019, Hu founded Shenzhen RuiXX Biotechnology Co., Ltd. The invention patent entitled “A mRNA based Osteoarthritis Drug Preparation and Its Preparation Method and Application” was applied by Shenzhen RuiXX Biotechnology Co., Ltd. in June 2021 and was granted in October 2021. Shenzhen ZhenXX Medical Technology Co., Ltd. filed a lawsuit claiming that the patent in question was a service invention completed by Hu during his tenure at the company. Shenzhen RuiXX Biotechnology Co., Ltd.’s application for the patent in question damaged the legitimate rights and interests of Shenzhen ZhenXX Medical Technology Co., Ltd. and requested a judgment to confirm that the patent right in question belongs to Shenzhen ZhenXX Medical Technology Co., Ltd. The court of first instance ruled to dismiss the lawsuit filed by Shenzhen ZhenXX Medical Technology Co., Ltd. Shenzhen Zhen Medical Technology Co., Ltd. filed an appeal.
[Judgment Result]
The Supreme People’s Court held in the second instance that this case involved a number of researcher returnees, a number of enterprises and institutions, and cutting-edge technologies in the field of biomedicine. Combined with the important position of mRNA technology in the field of medicine, and the fact that the three researchers had worked closely together, returned to China to start a business together, and made important contributions to the research and development of innovative drugs involving mRNA technology, it determined the trial ideas of “mediation first” and “untie the knot of emotions first, then the knot of law”. Through field investigations, circuit trials, and active mediation work, the parties were encouraged to sign a package settlement agreement on this case and other related lawsuits, which resolved the contradictions and series of disputes between the two parties for more than two years, and promoted the two parties to work together to return to cooperation on the cutting-edge track in the field of biomedicine, achieving win-win, multi-win, and win-win results.
【Typical significance】
The case was heard in public on “National Constitution Day” by a five-member panel headed by Tao Kaiyuan, Vice President of the Supreme People’s Court and Second-Level Justice, and was reported by nearly 40 media outlets. The mRNA technology involved in this case is a key common technology and cutting-edge high-tech in the field of biomedicine, and is a typical representative of new quality productivity. The substantive resolution of this case and related litigation disputes further released the clear orientation of the people’s courts to encourage innovation, promote integrity, respect science, and respect talents, which is conducive to scientific researchers’ courage to innovate and start businesses with peace of mind, better stimulate the innovation and creativity of the whole society, and promote the integrated development of scientific and technological innovation and industrial innovation.

Case 2. Trademark infringement and unfair competition in the real estate sector
[Dispute over trademark infringement and unfair competition between RenXX Land (Chengdu) Co., Ltd., Shanghai RenXX Real Estate Co., Ltd., Nanjing RenXX Enterprise Management Co., Ltd., Singapore RenXX Holdings Co., Ltd. and Lanzhou RenXX Real Estate Co., Ltd.]
Second instance: 最高人民法院（2023）最高法民终418号
【Basic Facts】
In 1993, RenXXLand (Chengdu) Co., Ltd. and Shanghai RenXX Real Estate Co., Ltd. were established. In 1994, Nanjing RenXX Enterprise Management Co., Ltd. was established. Since 1995, the above companies have launched real estate projects in Shanghai, Nanjing, Chengdu and other places, and have been approved to register multiple “RenXX” trademarks in multiple categories such as construction services. In January 2002, Jin, the legal representative of Lanzhou RenXX Real Estate Co., Ltd., purchased real estate developed by Shanghai RenXX Real Estate Co., Ltd. in Shanghai. Lanzhou RenXX Real Estate Co., Ltd. was registered and established on November 26, 2002, and began to use the “RenXX” corporate name, and successively developed and constructed RenXX International, RenXX Meilin County, and RenXX Jingcheng real estate projects in Lanzhou. RenXX Land (Chengdu) Co., Ltd. and others believed that the above-mentioned actions of Lanzhou RenXX Real Estate Co., Ltd. constituted trademark infringement and unfair competition, and thus filed a lawsuit. The court of first instance ruled that Lanzhou RenXX Real Estate Co., Ltd. should stop infringing trademark rights and engaging in unfair competition, compensate RenXX Land (Chengdu) Co., Ltd. and other companies for economic losses and reasonable expenses totaling RMB 13,405,992.3, and publish a statement to eliminate the impact. Lanzhou RenXX Real Estate Co., Ltd. appealed.
[Judgment Result]
The Supreme People’s Court held in the second instance that although Lanzhou RenXX Real Estate Co., Ltd. only used the alleged infringing logo in Lanzhou, considering the similarity between the alleged infringing logo and the four trademarks involved, the degree of relevance between the services and goods used, the popularity of the “RenXX” trademark, the actual use of Lanzhou RenXX Real Estate Co., Ltd., and the actual confusion that has occurred, it can be determined that the alleged infringing behavior of Lanzhou RenXX Real Estate Co., Ltd. is likely to cause confusion among the relevant public and constitute an infringement of trademark rights. Based on the use of the “RenXX” trademark by Shanghai RenXX Real Estate Co., Ltd. and others, including the fact that the legal representative of Lanzhou RenXX Real Estate Co., Ltd. had purchased a property developed by Shanghai RenXX Real Estate Co., Ltd. and was aware that Shanghai RenXX Real Estate Co., Ltd. had used the “RenXX” trademark first, it can be determined that the “RenXX” trademark constitutes a prior trademark with a certain influence. As a peer operator, Lanzhou RenXX Real Estate Co., Ltd. should have given way to the competition, but it still registered and used the “RenXX” brand name to engage in the same business activities as Shanghai RenXX Real Estate Co., Ltd., which easily led the relevant public to believe that the real estate projects it developed and constructed had a specific connection with Shanghai RenXX Real Estate Co., Ltd., etc. The above-mentioned behavior of Lanzhou RenXX Real Estate Co., Ltd. constituted unfair competition. The second-instance judgment dismissed the appeal and upheld the original judgment.
【Typical significance】
This case involves the protection of corporate name rights and trademark rights in the field of commercial housing development and construction. There are currently a large number of such disputes. This case clarifies common issues such as trademark use, likelihood of confusion, and fair use in trademark infringement in the field of commercial housing, and clarifies the review criteria and proof standards for the protection of competitive interests of corporate names in Article 6, Item 2 of the Anti-Unfair Competition Law of the People’s Republic of China. The judgment in this case includes the circumstances where the infringer is aware of the prior use of the name by others in the determination of “names with a certain influence”, conveying the judgment concept of protecting honest business and maintaining fair competition order.

Case 3. Infringement of trade secrets of undisclosed characters in a “spoiler” game
[Dispute between Shanghai MiXX Technology Co., Ltd. and Chen on infringement of trade secrets]
First instance: 上海市浦东新区人民法院（2024）沪0115民初38294号
【Basic Facts】
Shanghai MiXX Technology Co., Ltd. is the operator of a certain game and has obtained the permission of the copyright owner of the game to use and protect the rights. Since its launch, the game has aroused enthusiastic response in the global game market. During its operation, Shanghai MiXX Technology Co., Ltd. updates the version every once in a while, adding new characters, scenes, plots, activities and other content to maintain game attention and the vitality of the product. These contents will undergo internal testing in advance. To this end, Shanghai MiXX Technology Co., Ltd. and its affiliated companies recruited a number of players including Chen to participate in the internal testing and signed a confidentiality agreement. During Chen’s participation in the internal test, he secretly photographed and recorded the actual images (i.e. the images of the game characters that can be controlled by players), skill effects, skill data and other test content and pictures of the seven game characters involved in the game “Zhi XX” without permission, and disclosed them to third parties many times. After discovering this, Shanghai MiXX Technology Co., Ltd. filed an application for pre-trial behavior preservation (injunction) with the People’s Court on the grounds that the relevant information was a trade secret and further disclosure would cause irreparable damage to it, and filed a lawsuit within the statutory period, requesting an order to stop infringement, eliminate the impact and compensate for losses. Chen argued that the above-mentioned game content did not constitute a trade secret.
[Judgment Result]
The Shanghai Pudong New Area People’s Court reviewed the application for pre-litigation behavior preservation and held that the request of Shanghai MiXX Technology Co., Ltd. had factual basis and legal basis, and that failure to take corresponding preservation measures might cause irreparable damage to the legitimate rights and interests of Shanghai MiXX Technology Co., Ltd., and that taking behavior preservation measures would not lead to a significant imbalance of interests between the parties. Therefore, within 48 hours after receiving the application, the People’s Court of Pudong New Area of Shanghai made a ruling in accordance with the law, ordering Chen not to disclose, use, or allow others to use the game content that he had recorded without authorization during the game test.
The Pudong New District People’s Court of Shanghai held at first instance that the continuous dynamic game screens composed of elements such as the actual image of the characters, the effects of the characters’ skills, and the skill data of the seven game characters involved in the game met the business information characteristics and business secret constituent elements stipulated in the Anti-Unfair Competition Law, and were business secrets protected by the law. Chen violated the confidentiality obligation and secretly filmed and disseminated these business secrets, and should bear the corresponding legal responsibility. The essence of business secret protection is the competitive advantage that business secrets bring to operators. Even if the game characters have been made public due to version updates, Chen is still not allowed to disclose the test game screens that he may have. Therefore, Chen was ordered to stop the infringement, eliminate the impact, and compensate for economic losses and reasonable expenses totaling 500,000 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case involves the criteria for determining and adjudicating trade secrets based on undisclosed character designs and other information in the game, which is of positive significance for promoting the healthy development of the gaming industry. The pre-litigation behavior preservation ruling, combined with the characteristics of the online gaming industry, provides timely legal relief to the applicant. The judgment targets the situation of game character leakage, not only protecting the content of the game character itself, but also protecting the business model that increases attention through game version updates, as well as the competitive advantage brought by this business model, thus providing strong regulation on the behavior of early “spoilers”.

Case 4. “AI face-swapping” copyright infringement case
[Dispute between Chen XX and Shanghai Yi XX Network Technology Co., Ltd. over infringement of the right to disseminate information on the Internet]
First instance: 上海市嘉定区人民法院（2024）沪0114民初1326号
【Basic Facts】
Chen XX used the real-name authentication account “Photographer XX” on the Douyin (TikTok) platform to post 13 short videos of women wearing ancient costumes, each about 10 seconds long. Shanghai YiXX Network Technology Co., Ltd. developed the Douyin mini program “XXyan”, which uses AI video synthesis algorithms to provide users with face-swapping technology. The 13 short videos displayed on “XXyan” and the 13 short videos posted by Chen only differ in the facial features of the characters, while the video scenes, lenses, character modeling, and movements are basically the same. “XXyan” users can replace the faces in the videos displayed on the mini program with their own faces and save them by watching advertisements or purchasing memberships. Chen filed a lawsuit, requesting that Shanghai YiXX Network Technology Co., Ltd. be ordered to stop the infringement, apologize, and compensate for the loss of 48,000 RMB and reasonable expenses of 2,000 RMB.
[Judgment Result]
The Jiading District People’s Court of Shanghai held at first instance that the original video shot by Chen XX reflected original selection and arrangement in terms of content arrangement, scene selection, shooting angle, etc., and was an audiovisual work protected by copyright law. The video involved in the case displayed by the “XXyan” mini program was synthesized by partially replacing the original video through AI algorithms, and the two are substantially similar. Shanghai YiXX Network Technology Co., Ltd. used “AI face-swapping” as a selling point, provided platforms, materials and technologies, and enabled users to use the original video in a “face-swapping” manner at any selected time and place to seek commercial interests, infringing on Chen’s right to disseminate information on the Internet. This behavior is neither an original adaptation nor a fair use, nor does it apply to the technical neutrality defense. Shanghai YiXX Network Technology Co., Ltd. actively cooperated in the litigation to delete videos, perform algorithm filing procedures and other rectification behaviors, and accepted judicial suggestions on the use of algorithm technology to provide network services, and made a commitment to standardize operations. Chen XX expressed understanding and withdrew his request to stop infringement and apologize. Based on this, Shanghai YiXX Network Technology Co., Ltd. was ordered to compensate Chen XXfor economic losses and reasonable expenses totaling 7,500 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case is a typical dispute in the application scenario of generative synthesis algorithms, involving the nature of the use of artificial intelligence technology to partially synthesize other people’s works. The judgment in this case clarified that “AI face-swapping” does not constitute an original adaptation and fair use of the original work; those who use artificial intelligence technology to provide network services have a reasonable duty of care and may not use algorithmic technology to infringe on the copyright of others. This case balances technological innovation and rights protection, and clarifies the legal boundaries of the application of artificial intelligence technology. The people’s courts focus on the innovative application of emerging technologies and the needs of algorithm governance, urging companies to strengthen the legality review of material sources and generated content and algorithm security assessments, strengthen the protection of intellectual property rights and personal rights, and guide companies to standardize digital transformation.

Case 5. Game “skin-changing” infringement case
[Copyright infringement and unfair competition dispute between Chengdu LeXX Technology Co., Ltd., Shanghai LiXX Network Technology Co., Ltd. and Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd.]
Second instance: 广东省高级人民法院（2023）粤民终4326号
【Basic Facts】
“Awakening XX” is a war strategy simulation game (SLG), developed and operated by Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd. “XX Official” is a WeChat platform mini-program game, developed and operated by Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd. From December 2020 to March 2022, the revenue of the game “XX Official” was approximately 18.9 million RMB, and after deducting the corresponding channel fees, it was approximately 12.5 million RMB. Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd. filed a lawsuit, believing that the “skin-changing” behavior of the game “XX Official” constituted copyright infringement and unfair competition, and requested an order to stop the infringement, publish a statement to eliminate the impact, compensate for economic losses of 10 million RMB and reasonable rights protection costs of 500,000 RMB. After comparison, the overall structure and gameplay system of the two games are basically the same, and the parameter types, specific values, and interactive relationships of the game elements all have one-to-one correspondence, and even a large number of text expressions are completely consistent. The only difference is the art and audio-visual materials. The court of first instance determined that the alleged acts constituted copyright infringement and ordered Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXX Technology Co., Ltd. to immediately stop developing, operating and promoting the “XXX” game, publish a statement to eliminate the impact, and compensate for economic losses of 10 million RMB and reasonable rights protection costs of 500,000 RMB. Shenzhen JiuXX Interactive Technology Co., Ltd. and Hainan FanXXTechnology Co., Ltd. appealed.
[Judgment Result]
The Guangdong Provincial High People’s Court held in the second instance that copyright law protects the original expression of game play rules. The game structure, system, numerical planning and corresponding relationship requested for protection in this case belong to the game play mechanism design, reflecting all the ideas of the game developers for the virtual game world from details to the whole, and are not expressions in the sense of copyright law. Game play rules do not constitute “other intellectual achievements that meet the characteristics of works”, so the accused behavior does not constitute copyright infringement. However, the accused behavior violates the principle of good faith and business ethics, and exceeds reasonable limits to imitate and copy the overall classification framework of game play design to the details of numerical settings. It only simply replaces the art resources, diverts and seizes the market share of related games through this “skin-changing” method, disrupts the market competition order, and seriously damages the core competitive interests of Chengdu LeXX Technology Co., Ltd. and Shanghai LiXX Network Technology Co., Ltd., constituting unfair competition. The first-instance judgment found that the facts were clear, and although the application of the law was improper, the judgment was correct. The second-instance judgment dismissed the appeal and upheld the original judgment.
【Typical significance】
This case clearly states that game play rules do not belong to expressions in the sense of copyright law and should not be considered as “other intellectual achievements that meet the characteristics of works.” The judgment clarifies the legal boundaries, analytical framework, and adjudication rules for copyright law and anti-unfair competition law to protect game play, which will help promote innovation, creation, and healthy competition in the digital entertainment industry.

Case 6. Unfair competition case of online evaluation with “some criticizing and some praising”
[Unfair competition dispute between Wuxi ShiXX Clothing Co., Ltd., Wuxi JiuXX Trading Co., Ltd. and Suzhou BuXX E-commerce Co., Ltd., Suzhou XiXX E-commerce Co., Ltd., Suzhou XiXX Network Technology Co., Ltd., and Suzhou KuXX Network Technology Co., Ltd.]
Second instance: 江苏省苏州市中级人民法院（2023）苏05民终5492号
[Omitted as it relates to false advertising and not IP]

Case 7. Unfair competition case involving ticket grabbing software
[Dispute over unfair competition on the Internet between Beijing DaXX Culture Media Development Co., Ltd. and Zheng XXzhong]
First instance: 北京市东城区人民法院（2024）京0101民初4607号
【Basic Facts】
Beijing DaXX Culture Media Development Co., Ltd. is a large domestic comprehensive ticketing platform enterprise, operating DaXX.com and DaXX APP with ticketing functions. Zheng XXzhong sells ticket grabbing software for Damou APP through online stores. Beijing Damou Culture Media Development Co., Ltd. filed a lawsuit, claiming that Zheng XXzhong specially developed and sold plug-in software for its ticketing APP to grab tickets on sale on the APP, which constituted unfair competition, and requested that Zheng XXzhong be ordered to stop the infringement and compensate for economic losses and reasonable expenses. Zheng XXzhong argued that he did not have a competitive relationship with Beijing DaXX Culture Media Development Co., Ltd., and he was only the seller of the ticket grabbing software involved in the case, not the developer. His behavior of selling ticket grabbing software did not cause a reduction in the ticketing revenue of Beijing DaXX Culture Media Development Co., Ltd., nor would it affect the public ticket purchasing order, and did not constitute unfair competition.
[Judgment Result]
The Beijing Dongcheng District People’s Court held at first instance that Zheng XXzhong provided ticket grabbing services to users of Beijing DaXX Culture and Media Development Co., Ltd., and used the business activities and user base of Beijing DaXX Culture and Media Development Co., Ltd. as the basic resources for its own business. Therefore, the alleged behavior was a market competition behavior and fell within the scope of regulation of the Anti-Unfair Competition Law. The essence of the alleged behavior was that software replaced manual methods to help users grab tickets for performances on the DaXX platform. This behavior not only directly increased the operating costs of the platform and interfered with the operator’s correct business decisions, but also increased the difficulty for users to use the DaXX platform to buy tickets, and reduced users’ evaluation of the services provided by the DaXX platform. Although the alleged behavior did not directly reduce the ticket sales revenue of a single performance on the DaXX platform, it caused damage to the operating interests and goodwill of the DaXX platform and damaged the competitive interests of Beijing DaXX Culture and Media Development Co., Ltd. At the same time, the alleged behavior did not belong to fair competition in technological innovation, and also damaged the legitimate rights and interests and long-term interests of consumers, which was not conducive to the fair and orderly market competition order and the improvement of overall social welfare. In summary, the alleged behavior constituted unfair competition. Since the alleged behavior has been stopped, no separate judgment is made to stop the infringement, and Zheng XXzhong is ordered to compensate Beijing DaXX Culture Media Development Co., Ltd. for economic losses and reasonable expenses totaling 20,000 RMB. After the first-instance judgment, neither party appealed.
【Typical significance】
This case clearly points out that the ticket grabbing software involved in the case uses technical means to provide users with unfair advantages in ticket grabbing, undermines the platform’s ticket purchasing rules, interferes with and hinders the normal operation of the platform’s ticket sales business, and damages the competitive interests of specific operators. On this basis, the consumer’s fair ticket purchasing rights and the normal order of the ticket market are taken into consideration, and it is determined that the alleged behavior constitutes unfair competition. This case warns ticket grabbing service practitioners and technology developers to abide by legal rules, which has positive significance for combating online black and gray industries, safeguarding the legitimate rights and interests of operators and consumers, and building a fair and orderly ticket purchasing order and market competition environment.

Case 8. Criminal and civil lawsuit involving copyright infringement of popular film and television works
First instance: 浙江省东阳市人民法院（2024）浙0783刑初585号
【Basic Facts】
Since May 2020, the defendant Lu XXqian has built multiple illegal film and television websites by purchasing domain names, renting servers, purchasing system programs and film and television website templates. During this period, the defendants Ji XXshi and Fang XX knew that the defendant Lu XXqian was operating an illegal film and television website and still sold him the film and television navigation Content Management System program and multiple film and television website templates, and provided program technical maintenance services, charging more than 6,990 RMB. Without the permission of the copyright owner Beijing Guang XX Film Co., Ltd. and other rights holders, Lu XXqian added more than 120,000 film and television works such as “YOLO” and “Pegasus 2” on the website by adding video links, etc., for visitors to watch online, and cooperated with illegal advertisers to place advertisements on the website. From April 30, 2022 to February 15, 2024, the defendant Lu XXqian collected more than 1.48 million RMB in advertising fees. The People’s Procuratorate of Dongyang City, Zhejiang Province accused the defendants Lu XXqian, Fang XX, and Ji XXshi of copyright infringement and filed criminal charges. During the criminal proceedings, five companies including Beijing GuangXX Film Co., Ltd. filed a supplementary civil lawsuit, requesting that Lu XXqian be ordered to bear corresponding civil liability.
[Judgment Result]
The Dongyang People’s Court of Zhejiang Province held at first instance that the defendant Lu XXqian, for the purpose of profit, disseminated other people’s audiovisual works to the public through the information network without the permission of the copyright owner, and the illegal income was huge; the defendants Fang XX and Ji XXshi knew that others infringed the copyright and still provided assistance, and their actions also constituted the crime of copyright infringement. In response to the incidental civil lawsuits filed by the plaintiffs of the incidental civil lawsuits, the defendant Lu XXqian was determined to compensate the plaintiffs of the incidental civil lawsuits for economic losses by taking into account the nature, time, and profit of the defendant’s infringement. The defendant Lu XXqian was sentenced to four years in prison and a fine of 1.5 million RMB; the defendant Fang XX was sentenced to one year in prison, suspended for one year and six months, and fined 16,000 RMB; the defendant Ji XXshi was sentenced to ten months in prison, suspended for one year and four months, and fined 10,000 RMB; the defendant Lu XXqian compensated the plaintiffs of the incidental civil lawsuits for economic losses totaling 880,000 RMB; the illegal income was returned and seized crime tools were confiscated. After the verdict, none of the defendants or plaintiffs in the ancillary civil lawsuit filed an appeal, and the procuratorate did not file a protest.
【Typical significance】
This case is an example of severely punishing the illegal and criminal acts of broadcasting key protected cinema films during the Spring Festival. Pirated broadcasts of popular TV series and movies, the establishment of illegal and irregular film and television websites, and the dissemination of related film and television works to the public through information networks involve infringement of the copyright of film and television works. The trial of this case fully reflects the advantages of the “three-in-one” trial mechanism of civil, criminal, and administrative intellectual property rights, which not only solves the problems of conviction and sentencing of the defendants, but also solves the problem of civil compensation for the victims, and provides timely and comprehensive protection for intellectual property rights holders, achieving the organic unity of combating crime and efficiently safeguarding rights.

Powering The Future: The UK’s Nuclear Revolution

Introduction
Nuclear power has long been one of the cornerstones of the UK’s energy mix, providing a reliable source of low-carbon electricity. As the UK embarks on its Clean Energy Superpower mission, aiming for a clean electricity system by 2030 under the Clean Power 2030 Action Plan (CPAP) and achieving Net Zero by 2050, nuclear power, alongside renewable sources, will spearhead the transition to a sustainable energy future. Recent policy changes, regulatory adjustments, and legislative initiatives have fostered a favourable environment for both traditional and advanced nuclear technologies as the UK pursues decarbonisation. This article will explore these developments, beginning with the UK’s ambition and vision, and examining governmental support for nuclear projects. Additionally, we will offer insights into fusion and other innovative technologies, illustrating how the UK’s energy landscape is prepared to embrace the nuclear revolution.

This evolution reflects the government’s commitment to sustaining a diverse, home-grown, and resilient energy portfolio, capable of withstanding geopolitical shocks while fostering technological innovation and economic growth.

What is the UK’s ambition and vision for nuclear?
Currently, the UK has 5.9 GW of nuclear installed capacity; however, 4.7 GW are expected to come offline by 2030. In both the British Energy Security Strategy (2022) and the Powering Up Britain strategy (2023), the UK government committed to delivering up to 24 GW of nuclear by 2050 to cover a quarter of the country’s projected demand, placing the technology on equal footing with renewable energy sources. This long-term target was reconfirmed in the Civil Nuclear Roadmap to 2050 (‘Roadmap’) published in 2024, which elucidates the pathway to delivering a mix of large-scale nuclear power plants, innovative technologies such as small modular reactors (SMRs) and advanced modular reactors (ADRs), and fusion. The Roadmap details plans for the biggest expansion of nuclear energy in 70 years, including the construction of a major new nuclear power plant. This evolution reflects the government’s commitment to sustaining a diverse, home-grown, and resilient energy portfolio, capable of withstanding geopolitical shocks while fostering technological innovation and economic growth. The Roadmap’s ambition is reiterated in the latest report on the pathways to achieve Net Zero by 2050, the Future Energy Scenarios (‘FES’) 2024 produced by the new independent energy system operator and planner, the National Energy System Operator (NESO). Finally, CPAP, which is based on FES, concludes that in a renewables-based system, nuclear is essential to deliver a ‘backbone’ of vital firm low-carbon power.
How does the UK support nuclear technologies?
From traditional large-scale nuclear power plants to ground-breaking technologies, the UK has taken important policy, regulatory, financial, and legislative measures to support nuclear. These include a strategic approach to designing the energy system, improved permitting procedures, and funding mechanisms.
Strategic planning
The UK has adopted an integrated and whole-system approach in planning, managing, and operating the energy system, led by NESO. In a geographically constrained area with competing interests such as farming, biodiversity, and aerospace, project developers require more certainty regarding the optimal locations, quantities, and types of energy projects needed to achieve Net Zero. This information will be provided by the Strategic Spatial Energy Plan (SSEP), expected in 2026. The SSEP aims to accelerate and optimise Great Britain’s energy transition, outlining a pathway from 2030 to 2050. The first SSEP focuses on electricity generation and storage, including technologies like large-scale nuclear and SMRs, but excluding ADRs. These will be considered in future iterations of the SSEP. 

Along with the nuclear-specific NPS, the infrastructure permitting system in the UK is undergoing a major reform through the Planning and Infrastructure Bill 2025.

Faster, streamlined, effective, and cost-efficient permitting
The UK government has recently announced important changes in consenting nuclear technologies, easing the permitting procedure. First, they plan to replace the National Policy Statement (NPS) for Nuclear Energy Generation (EN-6), the statutory document that sets out the government’s policy to permit applications for nuclear nationally significant infrastructure projects (NSIPs – projects that exceed a specific power capacity threshold), with a new NPS called EN-7. The new regime will apply to all nuclear – heat and electricity – developments that exceed 50 MW. The NPS removes two restrictions:

A geographical restriction of building nuclear plants in a set list of eight sites. Nuclear sites will be built anywhere in England and Wales on a criteria-based approach, including high standards of safety, security, and environmental protection.
A time-limit restriction to deploy new projects in the eight sites by 2025, providing developers with more certainty and flexibility to build new plants. 

EN-7 also extends the scope of technologies covered and supports cutting-edge technologies, such as SMRs and AMRs, alongside gigawatt-scale plants. Additionally, a Nuclear Regulatory Taskforce will accelerate regulatory reforms and project delivery, including investment incentives. The consultation on EN-7 proposals has recently concluded, with the final version expected to be laid before Parliament in autumn 2025.
Along with the nuclear-specific NPS, the infrastructure permitting system in the UK is undergoing a major reform through the Planning and Infrastructure Bill 2025. The purpose of the Bill is to accelerate consenting for NSIPs, including through alternative routes of permitting on a case-by-case basis, streamlined and shorter consultation requirements, and a stricter judicial review system to limit meritless challenges against decisions that approve major infrastructure. These changes, when finalised, possibly in late 2025, are expected to apply to nuclear projects.
Furthermore, in March 2024, the Office for Nuclear Regulation (ONR), the Environment Agency (EA), and Natural Resources Wales (NRW) developed voluntary guidance for early regulatory engagement for those deploying nuclear projects in Great Britain. This guidance is intended for project developers, technology vendors, and permit holders.
Funding and derisking investment in nuclear
Nuclear projects are expensive to build. The recent examples of billions of budget overruns for the two new large-scale power plants, Sizewell C and Hinkley Point C (each having a capacity of approximately 3.2 GW), underscore the critical need for diverse and robust funding options to ensure the viability of these projects. We examine below some of the options including a new finance model and support from public bodies. 

…, the main issue with CfD is that project developers bear the entire construction risk, whereas under the RAB model, this risk is shared with consumers.

A new finance model: the Nuclear Energy (Financing) Act 2022 (NEFA 2022)NEFA 2022 introduces the use of the regulated asset base (RAB) model to finance new nuclear projects. This model is commonly used for major infrastructure projects such as airports, water, and energy networks because it helps to de-risk private investment. Under the nuclear RAB model, an eligible nuclear company will receive a guaranteed return on investment throughout the lifetime of the nuclear asset, which is reflected in the licence conditions. The RAB model is now preferred for large scale projects and possibly for SMRs, over other financing options, such as the bespoke Contract for Difference (CfD) deal used for financing Hinkley Point C in 2016. The CfD is a subsidy scheme that covers the entire construction costs of the project through a fixed price for electricity output once the plant becomes operational. However, the main issue with CfD is that project developers bear the entire construction risk, whereas under the RAB model, this risk is shared with consumers. Sizewell C has sought support through the RAB model, with the final version of the RAB licence conditions expected to be issued by Ofgem soon.

The role of Great British Nuclear, Great British Energy, and National Wealth FundWith the Energy Act 2023, the UK government has established a new publicly owned company, Great British Nuclear (GBN). GBN is the expert vehicle responsible for driving the delivery of new nuclear projects through each stage of project development, co-funding selected technologies, and ensuring the right financing and site arrangements to meet the 24 GW nuclear target by 2050. GBN’s first priority is to run a competitive process to select the best SMR technologies. This selection process has reached its final stage, with the decision expected this Spring.
The new UK government has created two more new bodies to support investment and provide funding for clean energy projects: Great British Energy (GBE) and National Wealth Fund (NWF). With a capital of £7.3 billion, GBE’s purpose is to develop, invest in, build, and operate clean, home-grown energy projects. GBE aims to accelerate Great Britain’s pathway to energy independence and security by working closely with industry, local authorities, communities, and other public sector organisations. According to GBE’s founding statement, the UK government will explore how GBE and GBN can best work together on delivering the nuclear programme. GBE will be officially established once the Great British Energy Bill becomes an Act.
The National Wealth Fund (NWF), previously known as the UK Infrastructure Bank, has been allocated £27.8 billion to stimulate investment in clean energy projects, including nuclear, and to support the implementation of the new industrial strategy. GBN, GBE, and NWF play crucial roles in nuclear investment, financing, and de-risking. However, the future of nuclear development will also be influenced by the upcoming Industrial Strategy and the Spending Review.

Invest in 2025 and Spending ReviewIn October, the UK government launched a consultation on the green paper ‘Invest 2035: the UK’s modern industrial strategy’. This strategy aims to remove barriers to growth and foster a pro-business environment in eight key sectors, including clean energy industries. Although nuclear projects are typically included under the ‘clean energy’ category, some stakeholders have requested through their responses a specific mention of nuclear technology to avoid any ambiguity. The final industrial strategy will be announced in June, alongside the second phase of the Spending Review.The Spending Review is the government’s process for setting departmental budgets for future years. The first phase of the review, announced in the Autumn Budget 2024, confirmed departmental budgets for 2024-25 and set budgets for 2025-26. The crucial second phase, also known as ‘the envelope,’ will establish spending plans for the next three years over a five-year period to achieve the government’s objectives, including the growth and Clean Energy Superpower missions. As emphasised by various stakeholders, the Spending Review will play a pivotal role in supporting nuclear projects. 

The UK is leading the way in fusion energy development and innovation.

Fusion, the ‘holy grail’ of nuclear
The UK is leading the way in fusion energy development and innovation. Starting with the UK’s fusion strategy in 2021, updated in 2023, the UK became one of the first countries to enact specific fusion legislation through the Energy Act 2023. This new legislation separates the regulations governing fusion energy from those that apply to traditional nuclear technologies by amending the Nuclear Installations Act 1965 to exclude fusion energy projects. As a result, fusion projects will not require licences from or be regulated by ONR, streamlining the path to commercial fusion energy deployment.
In May 2024, the UK government published a proposal for a new fusion-specific National Policy Statement (NPS), EN-8, to support an open-sited and technology-inclusive approach to siting new fusion energy facilities. Similar to EN-7, the fusion-specific NPS will use strategic criteria when identifying and assessing new sites for fusion facilities. The proposal also recommends designating all fusion plants as Nationally Significant Infrastructure Projects (NSIPs). The government has not yet published its final decision on EN-8.
In parallel, the UK government continues to advance fusion-specific projects and funding arrangements. Some of these initiatives include:

The pioneering Spherical Tokamak for Energy Production (STEP) programme, supported by £410 million funding from the UK government, aims to commercialise the technology and develop the first viable fusion power plant by 2040.
The landmark UK and US joint project, LEAPS, in partnership with Tokamak Energy.
A new joint private and UK government fusion investment fund, ‘Starmaker One,’ to assist fusion businesses and start-ups in commercialising the technology. The government has invested £20 million in the fund, which has the potential to raise between £100 million and £150 million overall investment. 

…, the UK wants to lead innovation and commercialise the use of alternative nuclear technologies, particularly as these technologies can be cheaper than traditional nuclear…

AMRs, SMRs and the AI twist
AMRs, also known as Generation IV reactors, have the potential to support a variety of applications beyond electricity generation. These include hydrogen production, industrial and domestic heating, and nuclear waste management solutions. To support these technologies, the UK government awarded £196 million last year to build a commercial facility for the production of high-assay low enriched uranium (HALEU), a fuel necessary for powering AMRs.
SMRs also show promising applications. The technology is expected to contribute significantly to the UK’s ambition to become a global leader in the Artificial Intelligence (AI) sector. The AI Opportunities Action Plan (‘AI Plan’) aims to establish ‘AI Growth Zones’ (AIGZs) to facilitate and expedite the deployment of advanced AI data centres. The first AIGZ could be located in Culham, adjacent to the UK Atomic Energy Authority. An AI Energy Council has been launched to identify clean and sustainable energy solutions to meet the considerable power requirements of these AI data centres. SMRs are among the technologies anticipated to fulfil the energy needs of these centres.
Similar to fusion, the UK wants to lead innovation and commercialise the use of alternative nuclear technologies, particularly as these technologies can be cheaper than traditional nuclear due to their size, modularity, and replicability. In a consultation launched in 2024, the UK government explores alternative routes to market for these technologies beyond GBN, HALEU, and the Advanced Nuclear Fund (ANF) that offer support to both SMRs and AMRs. For example, the RAB model might be more suitable for financing cutting-edge nuclear technologies than CfDs. The alternative routes to market proposals, when finalized and taken forward, will be a game changer for the deployment of SMRs and AMRs.
Conclusion
The UK’s nuclear policy is a dynamic and evolving framework that continuously reflects its commitment to a secure, low-carbon, and innovative energy future. This policy also leverages nuclear technology to support other critical sectors such as AI. By promoting a diverse range of nuclear technologies—from large-scale power plants to cutting-edge fusion research—the UK aims to meet its ambitious climate goals, drive innovation, and stimulate substantial economic growth. The opportunities presented by the UK’s nuclear revolution are vast, with new supportive planning frameworks making it easier to capitalise on them. 

The UK’s Failure To Prevent Fraud Act

Effective September 1, 2025, the UK’s Failure to Prevent Fraud offense will go into effect as part of the UK’s Economic Crime and Corporate Transparency Act 2023 (the ECCTA). The law significantly expands corporate liability for fraud committed by employees and other associated persons of relevant corporates and will require compliance refinement for any business within scope of the offense operating in connection with the UK. The UK government (its Home Office) published guidance in 2024 (the “Guidance”) to help companies navigate this corporate criminal fraud offense as well as take appropriate action to help prevent fraud.
As companies continue to grapple with recent developments regarding enforcement of the FCPA, international efforts to curb bribery and corruption have not waned. Foreign governments continue to prioritize anti-corruption enforcement such as the European Commission’s proposed directive from May 2023 to combat corruption, the ECCTA and Failure to Prevent Fraud Offense, as well as the recently announced International Anti-Corruption Prosecutorial Task Force with the UK, France, and Switzerland. These cross-border initiatives demonstrate how a temporary pause in U.S. enforcement of the FCPA should not result in companies moving away from maintaining robust and effective compliance programs.
The Failure to Prevent Fraud Offense
You can see more detail on the new offense in this article from our UK colleagues (Failure to prevent fraud: get ready for September | Womble Bond Dickinson). In summary, a “large organization” can be held criminally liable where an employee, agent, subsidiary, or other “associated person” commits a fraud offense intending to benefit the organization or its clients, and the organization failed to have reasonable fraud prevention procedures in place. An employee, an agent or a subsidiary is considered an “associated person” as are business partners and small organizations that provide services for or on behalf of large organizations. Regarding the underlying fraud offense itself, this includes a range of existing offenses under fraud, theft and corporate laws, which the UK’s Home Office notes as including “dishonest sales practices, the hiding of important information from consumers or investors, or dishonest practices in financial markets.”
A “large organization” for purposes of the fraud offense is defined as meeting two of the following three thresholds: (1) more than 250 employees; (2) more than £36 million (approx. USD $47.6 million) turnover; (3) more than £18 million (approx. USD $23.8 million) in total assets – and includes groups where the resources across the group meet the threshold. Further, the fraud offense has extraterritorial reach, meaning that non-UK companies may be liable for the fraud if there is a UK nexus. This could play out in several scenarios. For example, the fraud took place in the UK, the gain or loss occurred in the UK, or, alternatively, if a UK-based employee commits fraud, the employing organization could be prosecuted, regardless of where the organization is based.
What Companies Can Do Now
The Failure to Prevent Fraud offense is an important consideration in corporate compliance, extending beyond UK-based companies to non-UK companies with operations or connections in the UK. The only available defense to the failure to prevent fraud offense is for the company to demonstrate that it “had reasonable fraud prevention measures in place at the time that the fraud was committed” Or, more riskily that it was not reasonable under the circumstances to expect the organization to have any prevention procedures in place. To that end, the Guidance outlines six core principles that should underpin any effective fraud prevention framework: (1) top-level commitment; (2) risk assessment; (3) proportionate and risk-based procedures; (4) due diligence; (5) communication and training; and (6) ongoing monitoring and review. Specifically, the Guidance makes clear that even “strict compliance” with its terms will not be a “safe harbor” and that failure to conduct a risk assessment will “rarely be considered reasonable.” These principles mirror the now well-established principles in the UK that apply to the UK offences of failure to prevent bribery under the UK Bribery Act 2010, and failure to prevent the facilitation of tax evasion under the UK Criminal Finances Act 2017.
Companies should consider the following proactive steps:

Determining whether they fall within the scope of the ECCTA’s fraud offense.
Identifying individuals who qualify as “associated persons.”
Conducting and documenting a comprehensive fraud risk assessment to determine whether the company’s internal controls adequately address potential fraudulent activity involving the company.
Ensuring due diligence procedures, as related to, for instance, external commercial partner engagements and other transactions, address the risk of fraud in those higher risk activities.
Reviewing and updating existing policies and procedures to address the risks of fraud.
Communicating the company’s requirements around preventing fraud and providing targeted training to employees and other associated persons, including subsidiaries and business partners, to make clear the company’s expectations around managing the risk of fraud. 
Establishing fraud related monitoring and audit protocols, including in relation to third party engagements, for ongoing oversight and periodic review.
Ensuring these policies and procedures are aligned with other financial crime prevention policies and procedures and relevant regulatory expectations.

The months ahead are a critical window to align internal policies and procedures not only with the UK’s elevated enforcement expectations as evidenced by the ECCTA and the Failure to Prevent Fraud offense, but also as bribery and corruption remain a mainstay priority for other foreign regulators. Companies should continue to prioritize the design, implementation, and assessment of their compliance internal controls. Companies with a well-designed and effective compliance program will be better equipped to adapt as regulatory landscapes shift and emerging risks develop, enabling companies to more efficiently respond to new enforcement trends.

Mexico Simplifies Procedures Before Its Federal Commission for Protection Against Sanitary Risks

On March 27, 2025, Mexico’s Federal Commission for the Protection Against Sanitary Risks (COFEPRIS) published an agreement in the Official Gazette of the Federation (DOF) outlining simplification measures for COFEPRIS procedures.
Key simplification actions include:
(i) Eliminating mandatory use of the “Notice of Operation, Sanitary Responsible and Modification or Cancellation” form for filing notices of operation and sanitary responsibility for health-related supply establishments and environmental health establishments, in their various modalities. 
(ii) Eliminating mandatory use of the “Notice of the original establishment responsible for the cancellation of the sanitary responsible” when modifying or cancelling notices of operation and/or sanitary responsibility for health-related supply establishments and environmental health establishments, in its different modalities.(iii) Merging procedures COFEPRIS-05-006-A, COFEPRIS-05-006-B, COFEPRIS-05-006-C, COFEPRIS-05-006-D, and COFEPRIS-05-006-E into “Notice of operations and sanitary responsible for health-related supply establishments,” with different modalities.(iv) Merging procedures COFEPRIS-05-007-A, COFEPRIS-05-007-B, COFEPRIS-05-007-C, COFEPRIS-05-007-D, and COFEPRIS-05-007-E into “Notice of Modification or Cancellation of the Notice of Operation and/or Sanitary Responsibility of the Health-Related Supply Establishments,” with different modalities.
The agreement will enter into force 15 business days after its publication in the DOF.

New USTR Measures Target Chinese Maritime Sector: What You Need to Know

The Office of the United States Trade Representative (“USTR”) issued a detailed notice on April 17, 2025, regarding actions and proposed actions in response to China’s alleged targeting of the maritime, logistics, and shipbuilding sectors for dominance. The measures, USTR argues, will “disincentivize the use of Chinese shipping and Chinese-built ships, thereby providing leverage on China to change its acts, policies, and practices, and send a critically needed demand signal for U.S.-built ships.” Below, we break down the key elements of the notice and their potential impacts. 
Background
The USTR launched an investigation under Section 301 of the Trade Act of 1974 (“Trade Act”) following a petition received by five national labor unions on March 12, 2024. The petition alleged that China’s policies unfairly harm U.S. commerce by targeting dominance in critical maritime-related sectors. Following a review, USTR determined that these practices displace foreign firms, reduce opportunities for U.S. businesses, and weaken supply chain resilience due to dependencies on China’s controlled sectors. As a result, in the closing days of the Biden administration, USTR issued a determination that these actions are unreasonable and actionable under the Trade Act.
The investigation revealed that China’s dominance strategy restricts U.S. competition, undermines supply chain security, and creates vulnerabilities in critical economic sectors. In response, on February 21, 2025, the USTR issued a Federal Register notice proposing certain responsive actions, including service fees and restrictions on certain maritime transport services, which resulted in the USTR convening a two-day public hearing and receiving nearly 600 public comments from industry stakeholders. USTR published its determination on responsive actions on April 17, 2025, Notice of Action and Proposed Action in Section 301 Investigation of China’s Targeting the Maritime, Logistics, and Shipbuilding Sectors for Dominance, Request for Comments. 
Key Elements of the Notice of Action 
Restrictions on Chinese Vessel Operators, Owners, and Chinese-Built Vessels. The plan includes a first phase with a 180-day grace period, after which fees will be implemented on Chinese vessel owners and operators calling in the United States based on net tonnage. Chinese operators and owners will face a port fee of $50 per net ton beginning on October 14, 2025, which will increase by $30 a year over the next three years. 
Chinese-built vessels that are not Chinese-owned or controlled will face a lower phased fees of $18 per net ton or $120 per discharged container, whichever is higher. Those fees will also increase by $5 per net ton annually until 2028, with container fees increasing proportionally.
The fees will be applied per U.S. voyage, and not at each U.S. port call, as had been initially proposed, remedying objections raised by smaller U.S. ports. The fees will also only be levied up to five times per year on any given ship. 
All Liquified Natural Gas (“LNG”) carrier vessels (whether Chinese-built or Chinese-owned or operated) are exempt from the new fees, but the carriage of LNG from U.S. ports is subject to separate cargo reservation requirements outlined below. 
A number of exemptions were adopted to address objections raised in the March comment period by various U.S. shippers, ports, terminals, and regional carriers. These exemptions are only available Chinese-built vessels that are not Chinese-owned or operated. They include:

U.S.-owned vessels, where the U.S. entity owning the vessel is controlled by U.S. persons and is at least 75 percent beneficially owned by U.S. persons;
Vessels arriving at U.S. ports empty or in ballast (to avoid impacts to U.S. exports);
Smaller and medium-size vessels (with a capacity equal to or less than 4,000 Twenty-Foot Equivalent Units (“TEU”), 55,000 Deadweight Tonnage (“DWT”), or individual bulk capacity of 80,000 DWT);
Vessels engaged in shortsea shipping (entering a U.S. port in the continental United States from a voyage of less than 2,000 nautical miles from a foreign port or point);
Specialized chemical tanker vessels; and
Vessels enrolled in certain U.S. Maritime Administration sealift programs

Restrictions on Foreign-Built Vehicle Carriers and LNG Exports. Non-U.S.-built vehicle carriers will face fees based on Car Equivalent Unit (“CEU”) capacity, starting at $0 for the first 180 days and rising to $150 per CEU capacity thereafter. Beginning April 17, 2028, phased restrictions will require a growing percentage of U.S. LNG exports to be transported on U.S.-built, U.S.-flagged, and U.S.-operated vessels. This percentage will increase gradually over 22 years.
Proposed Tariffs on Ship-to-Shore Cranes and Cargo Handling Equipment. The notice proposes additional duties of up to 100 percent on cranes manufactured, assembled, or made with components of Chinese origin. Certain cargo handling equipment, including specific containers, chassis, and chassis parts from China, will also face tariffs ranging from 20 percent to 100 percent.
Significant Takeaways from the Proposed Actions
No Cumulative Fees. The Notice of Action clarified that the fees are not cumulative or stacked. A vessel will only be charged one fee per voyage/string of voyages and is limited to five charges per year. 
Phased Tonnage-Based Fee on Chinese Vessel Operators and Owners. The February Proposed Action proposed a flat rate fee of up to U.S. $1,000,000 per vessel entrance to a U.S. port or up to U.S. $1,000 per net tonnage (“NT”) of the vessel’s capacity. The Notice of Action contains a fee of U.S. $50 per NT (after the first 180 days), which will increase incrementally. While the burden on smaller ships is reduced, under the new formula fees on large tankers and containerships could be more than double the flat fees proposed in February. 
No Fees Based on Chinese Fleet Composition. The Notice of Action did away with one of the most controversial aspects of the February proposal, i.e., fees based on fleet composition for maritime transport operators with fleets comprised of Chinese-built vessels or maritime transport operators with prospective orders for Chinese vessels. 
Expansive Definition of Chinese Owners and Operators, Including Minority Shareholding Test. The Notice of Action includes multiple alternative tests for determining if a vessel owner or operator is Chinese for the purpose of the fee schedule. Chinese owner or operator status can be triggered by country of citizenship or organization, ownership, control, headquarters location, principal place of business, and other factors. An entity will be deemed a Chinese owner or operator even if only 25 percent of the entity’s outstanding voting interest, board seats, or equity interest is held directly or indirectly by an entity that is a national or resident of China, Hong Kong, or Macau, or organized under the laws of those jurisdictions, or has its principal place of business there. The 25 percent threshold may pose new challenges for publicly traded and widely held companies and funds outside China that have some China-linked investor participation.
Lack of Clarity Regarding Other Key Definitions. “Owner” and “Operator” are defined in the notice by reference to Customs and Border Protection (“CBP”) Form 1300 (Vessel Entrance or Clearance Statement); however, those terms are not actually defined in that CBP form or any accompanying rules. Accordingly, uncertainty about these key terms remains—regarding, for example, the “owner” status of lease-finance title holders and owners pro hac vice (i.e., bareboat charterers); and the “operator” status of technical managers, commercial managers, document of compliance holders, and others that share responsibility for vessel activities and compliance.
Fees on Vessel Operators of All Foreign Vehicle Carriers (not just Chinese-Built Ships). These fees are imposed any non-U.S. built vehicle carrier and are not limited to those vehicle carriers built in China. Like the cargo reservation provisions for LNG, this action is likely to draw protests and challenges that it exceeds USTR’s authority, as new fees on European, Korean, and Japanese car carriers have no apparent nexus to alleged Chinese shipbuilding and maritime practices. 
Cargo Reservation Requirements for LNG Exports. While USTR previously proposed a requirement that a mandatory percentage (increasing over time) of all U.S. exports be carried on U.S.-flagged, U.S.-built vessels, the current notice limits this cargo reservation requirement to LNG cargo only. Also, some exporters favor expanding the notice’s special treatment of LNG to other types of liquified gas and natural gas liquids exports.
Public Participation and Deadlines.
The comment period to the proposed tariff action opened on April 17, 2025. While USTR only solicited feedback on the tariff proposal, the docket is likely to attract commentary on the broader range of new remedies and issues introduced in the notice. USTR also will hold a public hearing on this proposed action on May 19, 2025, at the U.S. International Trade Commission in Washington, D.C. Requests to appear at the public hearing must be submitted by May 8, 2025, with written comments due by May 19, 2025. Rebuttal comments to the public hearing must be submitted within seven calendar days after the last day of the hearing.
Conclusion and Next Steps
The USTR’s notice introduces significant measures targeting China’s position in the maritime, logistics, and shipbuilding sectors. Key actions include the imposition of fees on Chinese maritime transport services, restrictions on U.S. LNG exports, fees on all non-U.S. car carriers, and proposed tariffs on vital shipping equipment. Stakeholders are encouraged to review the proposed measures and submit comments or requests to appear at the hearing by the specified deadlines. Companies involved in maritime transportation should begin preparing for the phased implementation of fees and restrictions.
For additional information, stakeholders can contact the USTR Section 301 support line at (202) 395-5725. 

RUSSIA DISCOVERS THE TCPA?: Russian Appellate Court Allows Consumer to Sue Bank for $61.00 Over Unwanted Calls

While the idea of suing over unwanted phone calls is nothing new for litigious Americans its quite novel elsewhere in the world–and a man in Russia might be the first to have invented the claim across the pond.
Apparently a Russian appellate court has recognized a constitutional right to privacy that can be invaded when a bank sends unwanted marketing messages after being asked to stop.
In the case a Russian guy asked the bank to stop calling but it ignored him. He sued for “moral damage” of 5,000 rubles– about $61.00. The lower court through out the case but the appellate court found the claim to have merit and ordered a trial on the issue of the calls.
Here in America, of course, consumers can–and often do– sue for unwanted phone calls under the Telephone Consumer Protection Act (TCPA). And unlike the limited damages recognized in Russia, the TCPA allows consumers to collect $500-$1,500.00 per unwanted call or text.
But there are limits in America as there are in Russia.
As one Russian authority stated in response to the ruling:
“Unfortunately, people themselves often forget that they gave consent to the processing of their data and to receive advertising information. In such cases, advertising is distributed legally. And consent has no statute of limitations if the contract did not specify its term, even if you signed it 20 years ago.”
True in Russia as it is in America.
Many websites collect consent for advertising and contact and then sell those consents far and wide as permitted in the fine print. As a result many companies will buy these “leads” and make totally legal phone calls that the consumer had forgotten–or perhaps never really understood– they requested.
While this is fascinating we will have to wait and see whether the idea of suing over unwanted calls catches on anywhere else.
Source : https://m.realnoevremya.com/articles/8741-russians-allowed-to-punish-banks-for-spam?_url=%2Farticles%2F8741-russians-allowed-to-punish-banks-for-spam#from_desktop

If The Shares of a Chinese Company Are Delisted, What Happens to Trading in California?

Yesterday’s Wall Street Journal includes a story about the possible delisting of shares of Chinese companies.  Shares of companies that are listed, or authorized for listing, on a national securities exchange (or tier or segment thereof) are classified as “covered securities”under Section 18(b)(1) of the Securities Act of 1933.  As such, state laws requiring registration or qualification are preempted.  Therefore, delisting will result in covered security status.  What does this mean for California?
Section 25130 of the California Corporations Code makes it unlawful for any person to offer or sell any security “in this state” (Section 25008) in any “nonissuer transaction” (Section 25011) unless it is qualified for sale or exempt from qualification.  Thus, the immediate consequence of delisting will be that secondary trading of shares of the delisted companies will require either qualification or an exemption.  
Following delisting, licensed broker-dealers to effect offers or sales but only if they are made pursuant to an unsolicited order or offer to buy.  Cal. Corp. Code § 25104(b).  For purposes of this exemption, an inquiry regarding a written bid for a security or a written solicitation of an offer to sell a security made by another broker-dealer within the previous 60 days is not considered a solicitation of an order or offer to buy.  Id.  A rule, 10 CCR § 260.104, establishes a presumption that an order or offer to buy is not unsolicited if the broker-dealer knows, or has reason to know, that the order or offer to buy is in response to one or more activities specified in the rule.  
Bona fide owners may also offer or sell a security for their own account if the sale is (i) not accompanied by the publication (Section 25014) of any advertisement (Section 25002); and (ii) is not effected by or through a broker-dealer in a public offering.  
It is also possible that other exemptions from Section 25130 will be available depending upon the particular circumstances (e.g., 10 CCR § 260.105.11).
The bottom line is that if a company is delisted from a national securities exchange, the company and those trading in the companies shares will need to consider applicable California requirements and exemptions.