Welcome to Euro Shorts, a short briefing on some of the weeks developments in the financial servicesindustry in Europe.

If you would like to discuss any of the points we raise below, please contact me or one of our other lawyers.

Claire Cummings

020 7585 1406claire.cummings@cummingslaw.comwww.cummingslaw.com

CUMMINGS HIGHLY COMMENDED AT HFM AWARDS 2015

Cummings is delighted to have been highly commended at the HFM Awards 2015 for BestOnshore Law Firm Client Start-up.

ESMA publishes responses to consultation on UCITS share classes

ESMA has made available the responses to its December 2014 discussion paper on share classesof UCITS (ESMA/2014/1577), which closed to comments on 27 March 2015. UCITS IVrecognises the possibility for different share classes to be offered to investors, but it does notprescribe whether, and to what extent, share classes of a given UCITS can differ from each other.The discussion paper set out ESMA's views on what constitutes a share class, including how todistinguish share classes from compartments of UCITS, and possible approaches to the extent ofdifferentiation between share classes that should be permitted. Respondents include AIMA, theDepositary and Trustee Association (DATA), the European Fund and Asset ManagementAssociation (EFAMA) and the Investment Association.

Commodity benchmark regulation

The Financial Markets Law Committee (FMLC) has responded to the Financial Stability Boardsrecent comments that it was considering reforms to reduce the likelihood of misconduct,including by assessing reforms to commodity benchmarks. The FMLCs letter response on theregulation of commodity benchmarks draws attention to certain reform initiatives in the field ofcommodity benchmarks, including: (i) IOSCOs work on principles for financial benchmarks,

which the FMLC describes as being drafted at a "high level"; and (ii) commodity benchmarkreform in the EU and the UK, and FMLC comments that unilateral national or regional action canlead to inconsistencies, gaps, overlaps, duplicative requirements and other legal uncertainties.Amongst other things, the FMLC encourages the FSB to adopt the approach that it took inrelation to market interest rate benchmarks.

Alternative finance markets surge in popularity across Europe

According to reports, European alternative finance markets are surging, prominent among whichare equity-based services such as crowdfunding and other online peer-to-peer lending scenarios.Key to this surge in popularity is considered to be the creation of internet-based platforms whichallow investors and businesses to connect and agree terms of bespoke investment and lendingdeals. The bulk of the progress being made by the alternative finance sector across Europe isapparently being driven by demand among small and medium-sized enterprises (SMEs) and start-ups. The growth in demand within these sectors of economies across the continent is assumed tobe largely the result of a widespread reluctance among major banking institutions to lend moneyto companies looking to fund early-stage development.

Eurozone growth outlook moving higher

An ECB survey this week has seen an upward revision in experts' growth forecasts for theeurozone, with both growth and inflation seen moving higher. The survey predicted that eurozoneinflation would stand at 0.1% in 2015, but rebound to 1.2 % in 2016 and 1.6% in 2017, movingtowards the ECB's target of around 2%. Mario Draghi, ECB President, is reported to have saidthat the Bank's raft of different policy measures, including its recent asset purchase programme,were helping to fuel economic recovery. In addition, the lower exchange rate of the euro isexpected to support exports. The survey represents the views of experts affiliated with financial ornon-financial institutions based within the EU, which are collected by the ECB Survey ofProfessional Forecasters (SPF).

ECON report on proposed SFT regulation

The European Parliament's Committee on Economic and Monetary Affairs has published itsreport on the proposed Regulation on securities financing transactions (SFT Regulation). ECONvoted on the draft report on 25 March 2015 and the European Parliament is scheduled to considerthe legislative proposal at its plenary session to be held between 7 and 10 September 2015.

IMF rules out payment delay for Greece

The IMF has all but ruled out allowing Greece to delay its payment of 1 billion next month,heightening fears that Greece will be forced to leave the eurozone. Christine Lagarde, head of theIMF, has said that delaying the payments would be an unprecedented action that would only makethe situation worse. According to reports, Greek finance minister, Yanis Varoufakis, was rebuffedafter he made an informal approach to discuss the issue. Mr Varoufakis is due to meet eurozonefinance ministers next week, however, his German counterpart, Wolfgang Schuble, has alreadyruled out a new deal, saying there is not enough detail concerning a new package for a decision togo ahead.

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SandraTypewritten TextCummingsTel: + 44 20 7585 1406Mob: + 44 7734 057 327www.cummingslaw.com17 April 2015

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