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This Practice Note outlines the law concerning criminal recklessness. The subjective test for recklessness Certain statutory and common law offences allow the prosecution to prove mens rea through ‘recklessness’. Put simply, recklessness is where the accused takes an unjustified risk that results in unlawful harm or damage. The House of Lords in R v G reaffirmed the subjective approach to recklessness. Before R v G, two distinct tests were used, depending on the offence charged: Subjective recklessness from R v Cunningham: the prosecution had to establish that the accused personally foresaw the risk. Objective recklessness from R v Caldwell: the prosecution only needed to show that the risk would have been obvious to a reasonable person, without proving the accused themselves foresaw it. In R v G, the House of Lords concluded that the objective test could operate unfairly where a defendant did not foresee the
This Practice Note examines the remedy of rescission, explaining when and in what manner a contract can be unwound (at common law, in equity and under statute) and thereby terminated and brought to an end. It covers the consequences and effects of rescission, the principal grounds for setting aside an agreement (misrepresentation, mistake, undue influence, duress, non‑disclosure, fiduciary misdealing and bribery) and the main obstacles to claiming rescission—affirmation, the intervention of third‑party rights and the impossibility of restitution. For further guidance on rescission in the context of misrepresentation, see Practice Note: Misrepresentation—rescission as a remedy. There are many ways in which a contract may reach its end; see: Terminating contracts—how and when a contract ends—overview for a brief and accessible summary, with links to the related further practical guidance, including Practice Note: Termination and expiry of contracts. For a table
What is a res judicata? A res judicata is a determination by a court or tribunal with jurisdiction over the cause of action and the parties, which finally disposes of the issues decided so they cannot be litigated again by those bound, save on appeal. Final judgments entered by default or by consent fall within this concept, whereas rulings on purely procedural points and any decision lacking finality do not. The doctrine’s aim is to bring litigation to an end and shield parties from being harassed by the same dispute twice. in personam—binds the parties and their privies in rem—binds all persons, privy or otherwise (ie a judgment binding the whole world) A party may rely on res judicata: as an estoppel to defeat an opponent’s claim or defence; and/or as the basis of their own claim or
The offence of causing grievous bodily harm with intent Wounding or causing grievous bodily harm (GBH) with intent can be tried solely in the Crown Court on indictment. Elements of the offence Under the Offences against the Person Act 1861 (OATPA 1861), the prosecution must establish that the defendant unlawfully and maliciously: wounded with the intention of causing GBH, or caused GBH with that intention, or wounded intending to resist or prevent the lawful arrest or detention of any person, or caused GBH intending to resist or prevent the lawful arrest or detention of any person ‘Unlawfully’ and ‘maliciously’ Unlawfully The wounding or causing of GBH must be unlawful. Such conduct may be lawful if used: in self-defence in defence of another in defence of property for the prevention of crime where the victim gave express or implied consent For further information on these defences, see below:
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Regulator powers in relation to parent undertakings In pursuit of the government’s goal of more rigorous oversight of the financial system—prompted by problems exposed after several prominent firm failures—the Financial Services Act 2012 introduced a range of fresh tools to the regulators’ armoury. Chief among these are the measures in Part 12A of the Financial Services and Markets Act 2000 ( FSMA 2000), which address the powers the FCA and PRA may exercise over ‘parent undertakings’ (as defined in FSMA 2000, s 420; see also the Glossary to the FCA Handbook). The Prudential Regulation Authority ( PRA) and the Financial Conduct Authority ( FCA) hold broadly equivalent powers for this purpose. The suite of powers in FSMA 2000, ss 192A–192N, is connected to those in FSMA 2000, Pt XII, which concern control over authorised persons. As with any corporate form, parent...
This Practice Note sets out a clear overview of how UK and EU legal frameworks are developing to accommodate digital bonds. It explains key terminology and the digital bond transaction lifecycle, covering the principal documents needed for issuance, with emphasis on smart contracts. It also signposts what practitioners should consider when engaging in digital bond transactions. Summary Digital bonds are now legally recognised in the UK and EU, provided the issuance structure complies with the relevant securities regime, the Prospectus Regulation and/or Regulation ( EU) 2023/1114 on markets in crypto-assets ( Mi CA), and the underpinning distributed ledger technology ( DLT) infrastructure falls within the scope of the competent regulator or sandbox. Practitioners should determine early whether an instrument is a native digital bond or a tokenised form of a traditional bond, as that choice shapes property law status, custody and settlement exposure, and...
This Practice Note sketches the landscape of de-risking within financial services firms’ anti-money laundering ( AML) and counter-terrorist financing ( CTF) programmes. It explores the principal sectors and client groups affected, sets out the pertinent legal and regulatory obligations, including how these interact with the Financial Conduct Authority’s ( FCA) Consumer Duty, and considers the FCA’s priorities and areas of focus. It further reviews policy and regulatory measures intended to tackle de-risking, such as the FCA’s examination of bank account closures, its assessment of the handling of domestic Politically Exposed Persons ( PEPs), and legislative changes concerning domestic PEPs in the Money Laundering and Terrorist Financing ( Amendment) Regulations 2023, SI 2023/1371. Key points Key points are as follows: the UK statutory and regulatory regime obliges FCA‑authorised firms, and those registered with the FCA for supervision under the Money Laundering, Terrorist Financing and...
The key regulatory frameworks shaping the debt capital markets in (1) the EU and EEA, and (2) the UK are outlined below. Before Brexit, the UK depended on EU lawmakers for a substantial part of its financial services regime. As a result, the measures listed here are predominantly EU legislative acts, which continued to apply in the UK after IP completion day as retained EU law ( REUL)... From 1 January 2024, any REUL still in effect is termed ‘assimilated law’, pursuant to section 5 of the Retained EU Law ( Revocation and Reform) Act 2023. Over time, assimilated law will be superseded by rules made by the financial services regulators within a framework set by the government and Parliament. For information on the assimilation of REUL, see Practice Note: Assimilated law... Mi FID II/ Mi FIR The principal EU legislation governing the debt capital markets...
This Practice Note provides an overview of the UK’s Data Protection Act 2018 ( DPA 2018). For a broader primer on data protection law in the UK, see Practice Note: Data protection law—new starter guide. The UK data protection law collection brings together wider guidance and is a suggested first port of call for research. In brief In summary, the DPA 2018 currently governs: the processing of personal data within the UK GDPR framework, complementing the core rules laid down in the United Kingdom General Data Protection Regulation, Assimilated Regulation ( EU) 2016/679 ( UK GDPR), with extra measures covering: lawful basis for processing processing on the basis of relevant international law processing special categories of personal data and criminal offence data ...
Background The Market Abuse Directive 2003/6/ EC ( MAD) was enacted in 2003, creating a legal framework across the EU to safeguard market integrity against insider dealing and market manipulation. In the wake of the extensive harm caused by the financial crisis, however, an assessment of MAD’s effectiveness was undertaken, leading the European Commission ( Commission) to propose its repeal and replacement. Consequently, on 12 June 2014, the Official Journal of the European Union published the texts of two new legislative instruments: Regulation ( EU) 596/2014 ( EU Market Abuse Regulation), Directive 2014/57/ EU on criminal sanctions for market abuse ( CSMAD) Together, the EU Market Abuse Regulation and CSMAD displaced MAD and ushered in a new EU‑wide market abuse regime that spans a broader range of markets, products and behaviour than before. The EU Market Abuse Regulation and CSMAD took effect on 3 July...
What are cryptoassets? One difficulty in grasping non-traditional money and assets is the inconsistent terminology. Regulators, tax bodies and commentators speak of digital currencies, virtual currencies, cryptocurrencies, cryptoassets and crypto tokens, and it is often uncertain whether the labels are being swapped freely or used with their distinct meanings in mind. For definitions, see Practice Note: Web 3.0, digital assets and cryptoassets—essentials. That Practice Note considers the benefits and drawbacks of using cryptoassets. A range of advantages helps explain their rapid rise in popularity, but these must be weighed against risks inherent in the cryptoasset. Pros of cryptoassets Below are some of the advantages of cryptoassets (notably when used as a fiat currency substitute): lower transaction costs compared with transfers of real currency and assets transparent costs and charges—hidden fees and extra charges common in other online payment methods are absent in Bitcoin...
Scope of this Practice Note This Practice Note outlines the principal risks to consumers from different categories of cryptoassets and related offerings, including staking, together with the consumer protection tools currently available and/or under consideration. What are cryptoassets? Understanding unconventional forms of money and assets is hampered by inconsistent terminology. Regulators, tax authorities and commentators alternately reference digital currencies, virtual currencies, cryptocurrencies, cryptoassets and crypto tokens, without always indicating whether these labels are used interchangeably or with precise distinctions. For definitions, see Practice Note: Web 3.0, digital assets and cryptoassets—essentials. Unless stated otherwise, this Practice Note adopts ‘cryptoassets’ as defined in section 417(1) of the Financial Services and Markets Act 2000 (as amended from time to time). Under section 417, a cryptoasset means any cryptographically secured digital representation of value or contractual rights that: can be transferred, stored or traded...
This Practice Note sets out the statutory defences available in respect of the three criminal insider dealing offences under the Criminal Justice Act 1993 ( CJA 1993): the ‘dealing offence’, the ‘encouragement offence’ and the ‘disclosing offence’. It should be read alongside Practice Note: Insider dealing—the criminal offence, which details the constituent elements of the three criminal insider dealing offences. For coverage of the civil/regulatory insider dealing framework, see Practice Note: UK Market Abuse Regulation—insider dealing. General defences The statutory defences applicable to the three criminal insider dealing offences appear in CJA 1993, s 53. The burden lies with the defence to demonstrate, on the balance of probabilities, that a defence is established. General defences to the dealing offence and encouraging offence There are three general defences available to the dealing offence or the encouraging offence......
The general prohibition under FSMA 2000 The general prohibition sits at the centre of the UK regulatory framework, anchoring the regime. In essence, anyone delivering financial services must hold the appropriate authorisations and permissions to conduct business lawfully, before continuing such activities. Under the UK financial services regime, firms must assess whether approval is required from various authorities and recognise the notion of PRA-regulated activity as part of that assessment. In principle, this creates wider room for firms to inadvertently breach the need to be authorised and to lack the requisite Part 4A permissions in place. In practice, though, a large share of enforcement targets firms and individuals who likely never intended to seek authorisation, eg boiler rooms, share scams, deposit frauds, and ponzi schemes (all variants of fraud in different forms). For further details, see What are regulated...
What is a credit rating agency methodology? A credit rating agency ( CRA) methodology is the set of policies, processes and criteria a CRA uses when assigning or updating a credit rating. CRAs issue three principal categories of ratings: ratings of corporates ratings of sovereigns ratings of securities issued through a securitisation or comparable transaction (structured securities), where a special purpose vehicle ( SPV) holds a pool of assets and payments to investors depend on cash flows from those assets A credit rating for a corporate or sovereign generally reflects an evaluation of: the stand-alone credit strength of the entity prior to any external support any external assistance that could be available if the entity encounters financial stress the particular financial instruments being rated A credit rating for structured securities typically considers: the credit quality of the...
IOSCO standards The primary publication from the International Organization of Securities Commissions ( IOSCO) establishing regulatory benchmarks for credit rating agencies ( CRAs) is its Statement of Principles on the activities of Credit Rating Agencies, first issued on 25 September 2003 (the Statement of Principles). IOSCO also released the Code of Conduct Fundamentals for Credit Rating Agencies (the Code of Conduct), initially published in December 2004 and most recently updated in March 2015. CRAs are required to take IOSCO’s Statement of Principles and Code of Conduct into account in their work, and national regulators are required to reflect these standards within regulatory requirements and guidance. The Code of Conduct sets out the following definitions of a ‘credit rating’ and a ‘credit rating agency’: Credit rating—an opinion on the creditworthiness of an entity, a credit commitment, a debt or debt‑like...
As a result of coronavirus ( COVID-19) pandemic Investment funds have grappled with both operational pressures and the fallout from sharp swings in international markets. The pandemic, together with pronounced volatility and the valuation challenges it sparked, has driven substantial market corrections and heightened liquidity risks, causing strain across various parts of the financial system, including certain areas of the investment fund industry. These developments are outlined in a joint committee report on risks and vulnerabilities in the EU financial system, released by the European Securities and Markets Authority ( ESMA) and the other European Supervisory Authorities ( ESAs) in September 2020. The Financial Conduct Authority ( FCA) has issued guidance setting out its expectations for funds in the context of coronavirus. It recognises the considerable difficulties firms face, yet still expects them to act in the best interest of their...
ARCHIVED: This Practice Note has been archived and is not maintained. EU and UK watchdogs have been tracking the effects of coronavirus ( COVID-19) on payment services and systems, seeking to ensure that consumers can keep making payments securely and safely throughout the pandemic. The outbreak has accelerated the uptake of contactless payments for users and businesses while drawing attention to concerns over access to cash. This Practice Note offers an overview of the impact of coronavirus on payment services and systems within the UK and EU. In the EU, on 25 March 2020 specifically, the European Banking Authority ( EBA) released a statement regarding payment issues in light of coronavirus. Among other points, the EBA urged payment service providers ( PSPs) to support measures that limit the spread of coronavirus. In the UK, the Financial Conduct Authority ( FCA) states it is in...
The swift worldwide transmission of coronavirus ( COVID-19) and the measures introduced to curb infection are exerting a marked effect on the world economy and, in turn, the financial system. Insurers face pressures on both halves of their balance sheets; on the liabilities side due to shifts in interest rates and the potential rise in claims, and on the assets side from severe market turbulence and uncertainty. The industry is, in general, well capitalised, with advanced risk management that should help the sector collectively absorb the material shocks linked to coronavirus. Insurance plays a vital function during a pandemic, offering essential protection and support for individuals, households and firms. Supervisors of insurance have enacted various regulatory and supervisory actions to ease significant operational burdens on insurers in the wake of the coronavirus outbreak and to allow suitable flexibility so insurers can...
To lessen the medium- and long-term economic fallout from actions taken to curb the coronavirus ( COVID-19) pandemic, EU Member States have rolled out a wide spectrum of support. Frequently, these include some form of moratorium on credit repayments, aimed at easing borrowers’ short‑term liquidity and operational pressures. In the UK, lenders and the Financial Conduct Authority ( FCA) have introduced measures to assist both consumers and businesses during the pandemic. The FCA has published temporary guidance enabling firms to act at pace to deliver swift, time‑limited support to customers, at unprecedented scale, as the virus and the government’s response continue to evolve. This short‑term help is intended to bridge the crisis and help consumers regain their footing. This Practice Note This Practice Note summarises the FCA’s temporary guidance setting out its expectations for firms supporting consumer credit, overdraft, and mortgage customers facing temporary payment...
Principal documents The key papers required when establishing a corporate joint venture are as follows: the articles of association (the 'articles') of the joint venture company ( JVC); and the joint venture agreement ( JVA) (often, and sometimes also, called a 'shareholders' agreement'). A shareholders' agreement operates under English common law as a commercial contract in nature and is not governed by any distinctive or special legal rules. The expression 'shareholders' agreement' may denote an informal—indeed, even an implied—arrangement between only certain shareholders in a company, as well as a highly detailed agreement regulating, for instance, the formation of a JVC. For a discussion of what is typically covered in the JVA and also in the JVC's articles, see Practice Note: Documenting the corporate joint venture......
This Practice Note outlines when and how lenders may obtain and realise security under sections 105–126 of the Consumer Credit Act 1974 ( CCA 1974), covering the creation of security, typical forms used in consumer credit arrangements, and methods of enforcement. For guidance on routes to enforce judgment debts arising from consumer credit, see Practice Note: Enforcing a consumer credit agreement. General Consumer credit agreements are frequently supported by some form of security, granted by the borrower or by a third party. Such security affords lenders vital protection against the risk that a defaulting borrower cannot meet any judgment obtained against them. It may, however, impose a significant burden on the borrower, for instance where the collateral is a charge over their home. As a result, the obtaining and enforcement of security are tightly regulated by CCA 1974. The principal rules appear in sections 105–126 of CCA...
Scope of this Practice Note This Practice Note explains the regulatory framework for consumer buy-to-let ( CBTL) lending under the Mortgage Credit Directive Order 2015, SI 2015/910 ( MCD Order 2015), which implemented the EU Mortgage Credit Directive ( Directive 2014/17/ EU) (the EU MCD) within the UK regime before the UK decided to leave the EU. The MCD Order 2015 was issued on 25 March 2015 and became fully operative on 21 March 2016, the deadline by which all Member States were required to implement the EU MCD. For a flowchart indicating whether CBTL registration obligations apply, see: Registration requirements for CBTL mortgages—flowchart. For an outline of the UK’s implementation of the EU MCD, see Practice Note: Mortgage Credit Directive— UK implementation and the post- Brexit regime. For an overview of the EU MCD framework, see Practice Note: EU Mortgage Credit...
STOP PRESS: This document is currently being revised to take account of the Data ( Use and Access) Act 2025 ( DUAA 2025), which updates the UK GDPR and the Data Protection Act 2018. For further detail on DUAA 2025 compliance, see Practice Note: Data ( Use and Access) Act 2025—compliance implications. This Practice Note draws on the UK General Data Protection Regulation ( UK GDPR) and the consent guidance issued by the Information Commissioner’s Office ( ICO). Under the UK GDPR, consent is rarely the default lawful basis for handling personal data, and organisations should assess whether another lawful ground is more suitable from both legal and operational viewpoints—see below: Do you need consent? and Practice Note: How to process personal data lawfully. What is consent? Consent means a freely given, specific, informed and unambiguous expression of the data subject’s wishes, whereby they indicate...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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