In-house lawyer tracker: Stay ahead of key legal and regulatory changes – Economic crime, Employment & professional regulation and Responsible business

This Practice Note highlights key legal and regulatory changes that affect or will affect in-house lawyers in 2022 and beyond. While some are set in stone, others are more speculative at this stage or subject to the parliamentary timetable. It was last updated on 27 July 2022. Topics covered in this blog include:

Economic crime
Employment & professional regulation
Responsible business

To find out more on Commercial and corporate governance and Data & privacy click here.

Economic crime

The table below represents edited highlights that are not sector specific. For more details, see: .

Category	Details	Expected or actual date
Financial sanctions	The Economic Crime (Transparency and Enforcement) Act 2022 (EC(TE)A 2022), which received Royal Assent on 14 March 2022, makes fundamental changes to the financial sanctions regime by: —lowering the liability threshold for the imposition of a civil monetary penalty for breaching financial sanctions, and —giving OFSI power to publicly ‘name and shame’ a company or individual it believes, on the balance of probabilities, has breached a financial sanction prohibition or failed to comply with an obligation, even where no fine is imposed See Practice Note: Economic Crime (Transparency and Enforcement) Act 2022—an introduction.	These two provisions came into force on 15 June 2022. Other sanctions related changes, aimed at streamlining the process of making sanctions regulations, designations, reviews and reports, and information sharing, came into force on the day the EC(TE)A 2022 was passed. See: . The ongoing Ukraine conflict presents challenges to all businesses in the UK. Staying up to date is critical—see: —Conflict in Ukraine—UK sanctions tracker —Conflict in Ukraine news & analysis—tracker See also Practice Note: Sanctions regime—Russia.
Failure to prevent offence	The Law Commission has consulted on the law regarding corporate criminal liability, including extending the scope of failure to prevent offences to cover fraud and other economic crimes. The consultation closed on 31 August 2021. It had been anticipated that a new failure to prevent offence might be included in EC(TE)A 2022, but no such offence was in fact included. The Law Commission’s published its on 10 June 2022. The paper contains ten options for reform, including expanding the number of failure to prevent offences to cover fraud, human rights abuses and computer misuse. Other recommendations include options in relation to monetary penalties, use of Serious Crime Prevention Orders and reporting requirements.	The government will now review and consider the options paper. Should the government want to introduce any of the failure to prevent offences, the Law Commission’s recommendation is that further work and consultation would be necessary on the scope of the offences.
Economic crime levy for MLR 2017 regulated firms	On 21 September 2021, HM Treasury announced that anti-money laundering (AML) regulated entities with over £10.2m in UK revenue will be charged an economic crime levy of £10,000 to £250,000 depending on UK revenue. The levy will be applied on an annual basis for each financial year, commencing in the tax year 2022/2023. Payment will be due within six months of the end of the financial year, ie by 30 September, although collectors (HMRC, the FCA and the Gambling Commission) may require earlier payment if this aligns with their existing fee processes. See News Analyses: Finance Bill 2022—the economic crime levy and The Economic Crime (Anti-Money Laundering) Levy.	The Economic Crime (Anti-Money Laundering) Levy Regulations 2022, were made to make provision relating to the assessment, payment and collection of the Levy. They came into force on 1 April 2022. The first charge for the levy will be for the 2022/2023 financial year with the first payments due to be made before 30 September 2023.
AML and counter-terrorist financing	The Money Laundering and Terrorist Financing (Amendment) (No 2) Regulations 2022 contain some key changes in relation to: —Trust and Company Service Providers (re business relationships) —proliferation financing —reporting discrepancies, and —supervision and information-sharing See News Analysis: Money Laundering and Terrorist Financing (Amendment) (No 2) Regulations 2022—key amendments for compliance teams.	The No 2 Regulations 2022 come into force on various dates between August 2022 and September 2023. See News Analyses: Money Laundering and Terrorist Financing (Amendment) (No 2) Regulations 2022—key amendments for compliance teams This is not the end, however, as the government published a forward-looking in June 2022. Alongside this, the government also published two post-implementation reviews to fulfil its statutory obligations; . We therefore expect a rolling programme of change to the AML regime in the coming months and years. See: .
European AML package	The European Commission has published a package of , including: —two draft Regulations (to create a single EU supervisory authority (AMLA) (the AMLA Regulation) and to set out detailed rules and requirements in areas such as client due diligence (the Conduct Regulation)) —a new directive—6MLD See Practice Note: European Commission 2020 Action Plan on AML/CTF and 2021 legislative package.	The timing is ambitious. AMLA is scheduled to start work in 2024 with the aim of reaching full staffing and direct supervision in 2026.
Beneficial ownership register of overseas entities that own UK property	As part of its response to the Ukraine conflict, the government fast-tracked the long-awaited EC(TE)A 2022, which received Royal Assent on 14 March 2022. See: . EC(TE)A 2022 requires overseas entities to register with, and provide details of their beneficial owners to, UK Companies House before the overseas entity can be registered as the legal owner of UK land. deals with registration of overseas entities. See Practice Note: The beneficial ownership register of overseas entities that own UK property.	A was updated on 19 July 2022 to confirm that Companies House intends to launch the Register of Overseas Entities on 1 August 2022.

Employment & professional regulation

The table below represents edited highlights that are not sector specific. For more detailed trackers, see:

Category	Details	Expected or actual date
Professional Qualifications Act	The () received Royal Assent on 28 April 2022. It creates a new framework for recognising qualifications from overseas. It is intended to improve the transparency around the entry and practice requirements of regulated professions, such as medicine, nursing and teaching. See: .	The provisions of the come into force on various dates and consultation on devolved matters is required before regulations are made. See Practice Note: Recognition of professional qualifications—Professional Qualifications Act 2022 (PQA 2022).
Trainee solicitor minimum wage	The Law Society has recommended that the salary for aspiring solicitors should be raised to £21,024 outside of London and £23,703 within London—for qualifying work experience for the Solicitors Qualifying Exam or during the training contract. The minimum salary is voluntary good practice. There is no regulatory requirement to pay the recommended amount and no consequences for not doing so. See: .	The recommended rate comes into effect on 1 September 2022.
Regulation of solicitors	The SRA has confirmed that the 2022 practising certificate renewal exercise will run from 1 to 31 October 2022. See .	1 to 31 October 2022.
Future of Work Review	Matt Warman MP is to lead a review into how the government can best support a thriving future UK labour market. See: .	Review to be conducted over Spring and Summer 2022.
National Disability Strategy	The Women and Equalities Committee has published a call for evidence on the implementation and further development of the Government’s National Disability Strategy See: .	The consultation closed on 24 July 2022.
Flexible working	BEIS is consulting on proposals to reform flexible working regulations. Its consultation was published 23 September 2021. See: .	Consultation closed 1 December 2021 and the government is analysing responses.
Ethnicity pay reporting	The government launched a consultation on ethnicity pay reporting in 2018. See: .	In May 2022, the government announced that it will not introduce mandatory ethnic pay reporting. See .

Responsible business

Category	Details	Expected or actual date
Independent review of the ()	The government has been engaged in a review of since 2018. It has announced a number of changes will be made to and government guidance. See Practice Note: How to prepare a slavery and human trafficking statement—Future changes to slavery and human trafficking statements.	Revised government guidance was due to be issued in 2020, with further revisions once the legislation has been changed. This guidance is still awaited.
Supply chain due diligence—forest risk commodities	Following a in 2020, the Environment Act 2021 includes new provisions requiring larger businesses to undertake due diligence to show that they have taken proportionate action to ensure they are not using ‘forest risk commodities’ in their supply chains. The detail of the proposed requirements will be implemented through secondary legislation and the Department for Environment, Food & Rural Affairs (Defra) has launched a further on the implementation of the due diligence provisions to help design the secondary legislation and accompanying guidance. See: LNB News 03/12/2021.	In its response to the consultation (June 2022), the government has confirmed the due diligence requirements will apply to large companies and the definition of turnover will be aligned with the Companies Act 2006. The threshold will be based on turnover in the previous financial year. In respect of the other consultation questions, the government merely says it will take into account consultation responses in developing the legislation and accompanying guidance, and publish the government’s approach to secondary legislation in due course. No timescale is given.
Health and well-being at work—solicitors	The SRA has been on changes to its rules and the SRA Codes of Conduct to clarify issues surrounding the appropriate treatment of work colleagues, and the risks regarding an individual solicitor’s health and fitness to practise. Its proposals include introducing explicit obligations to treat colleagues with respect and dignity and changes to clarify the SRA’s power to take action in cases where a solicitor’s fitness to practise may be affected by their health. The consultation closed on 27 May 2022.	The consultation closed on 27 May 2022.

Category

Details

Expected or actual date

Independent review of the ()

The government has been engaged in a review of since 2018. It has announced a number of changes will be made to and government guidance.

See Practice Note: How to prepare a slavery and human trafficking statement—Future changes to slavery and human trafficking statements.

Revised government guidance was due to be issued in 2020, with further revisions once the legislation has been changed. This guidance is still awaited.

Supply chain due diligence—forest risk commodities

Following a in 2020, the Environment Act 2021 includes new provisions requiring larger businesses to undertake due diligence to show that they have taken proportionate action to ensure they are not using ‘forest risk commodities’ in their supply chains.

The detail of the proposed requirements will be implemented through secondary legislation and the Department for Environment, Food & Rural Affairs (Defra) has launched a further on the implementation of the due diligence provisions to help design the secondary legislation and accompanying guidance.

See: LNB News 03/12/2021.

In its response to the consultation (June 2022), the government has confirmed the due diligence requirements will apply to large companies and the definition of turnover will be aligned with the Companies Act 2006. The threshold will be based on turnover in the previous financial year. In respect of the other consultation questions, the government merely says it will take into account consultation responses in developing the legislation and accompanying guidance, and publish the government’s approach to secondary legislation in due course.
No timescale is given.

Health and well-being at work—solicitors

The SRA has been on changes to its rules and the SRA Codes of Conduct to clarify issues surrounding the appropriate treatment of work colleagues, and the risks regarding an individual solicitor’s health and fitness to practise. Its proposals include introducing explicit obligations to treat colleagues with respect and dignity and changes to clarify the SRA’s power to take action in cases where a solicitor’s fitness to practise may be affected by their health. The consultation closed on 27 May 2022.

The consultation closed on 27 May 2022.

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