2021 has seen the UK Government and regulators engage in a blizzard of consultations and draft legislation, proposing reforms across a wide range of areas. The sheer volume makes it difficult for businesses to keep on top of changes that might affect them. To assist with that process, this briefing breaks down key recent consultations by topic, so you can pick out those which are relevant to your business. It also looks at why this is happening now and whether any coherent themes emerge from the Government's regulatory reform programme.

The list of consultations below is not intended to be exhaustive.


Why so many consultations now?

The UK Government could have consulted on some of the issues highlighted below last year. However, it appears to have been distracted by a combination of dealing with COVID and finalising the Brexit negotiations. The UK's departure from the EU also provides a "once in a generation" opportunity to review regulation in areas that were previously subject to EU law – but as we noted previously, the Government did not seem to have a clear vision of what it wanted to change. It is only now starting to develop a broader agenda for regulatory reform (for example, by commissioning a report from a Taskforce on Innovation, Growth and Regulatory Reform (TIGGR), published in June 2021).

Brexit is an important driver of reform – but not the only driver

In a number of its recent communications, the Government seeks to frame its regulatory reform initiatives primarily in terms of taking advantage of new freedoms afforded by leaving the EU. However, whilst this is clearly the main driver behind some of the consultations highlighted below, a significant number are not particularly closely related to Brexit and many would probably have been pursued anyway (examples include many, though not all, of the proposals listed below under Employment, Consumer Protection, Corporate and M&A, Data and Tech, Real Estate and Tax). It's also worth noting that some areas which might have been expected to appear on a "hit list" of Brexit-related reforms, such as EU-derived employment law (aspects of which were much criticised by Euro-sceptics), are largely being left untouched (probably because of Government assurances that it would not undermine existing workers' rights).

Not much sign of a bonfire of red tape

Although the Government is keen to emphasise that leaving the EU provides an opportunity to cut red tape, the reality is that few of the measures being consulted on are likely to result in substantial regulatory burdens being removed (indeed a number of the proposals highlighted below are more likely to increase the overall burden). As we explain under Data & Tech below, there are even some areas where radical divergence from the EU in the name of reducing red tape could actually increase it for some businesses, such as those needing to exchange data with the EU.

There may, however, be scope to make a raft of incremental improvements which, taken as a whole, could give the UK an edge over the EU and other countries as an attractive place to do business. In particular, the Better Regulation consultation advocates what it describes as a more "common law" approach, which it argues would be less prescriptive, more proportionate and easier to adapt to changing circumstances.

The Government's approach

Ministers have sometimes criticised EU regulation for being excessively detailed and inflexible and instead have advocated a principles-based approach, setting out broad outcomes to be achieved and leaving it up to regulators to decide on implementation. While these arguments may be legitimate in some cases, many English lawyers would say that an equally common frustration with EU law (both legislation and caselaw) is that it often sets out broad, general principles without providing sufficient detail on how they should be interpreted - leaving businesses (and sometimes also regulators) uncertain about how to comply with or enforce the relevant law. An alternative approach would be for the Government to emphasise the benefits of a common law approach in providing businesses with greater certainty. In particular, it should recognise that there will be situations where detail is necessary to provide that certainty and that it will not always be appropriate to leave the drafting of that detail to regulators.

There is also a risk that in pursuing so many consultations at once, the Government is trying to do too much, too quickly. Better regulation is clearly a desirable outcome but, as previous Governments have found, it can be difficult to implement in practice, particularly if the regulators that have responsibility for such implementation are not adequately resourced. It may be preferable for the Government to concentrate its resources on a smaller number of changes, ensuring that they are properly implemented, with more extensive coordination between related policy areas.

That said, if the strategy is to pursue a more ambitious agenda for reform, this may explain what appears outwardly to be a somewhat "scattergun" approach – because such a strategy is only likely to make a difference based on the cumulative impact of a significant number of relatively small changes.

Better regulation

In July 2021 the Government published a consultation paper outlining possible new approaches to regulation generally, drawing on ideas in the TIGRR report, including:

  • Emphasis on a more "common law" approach in future
  • A proportionality principle
  • A duty on regulators to promote innovation and competition
  • The delegation of more discretion to regulators to formulate the detail of regulation, with Parliament's role being restricted to setting high level principles/frameworks
  • Greater use of "regulatory sandboxes" to test innovative approaches
  • Greater accountability for regulators and better scrutiny of regulation both before it is made and periodically, after it has been implemented
  • "Regulatory offsetting" i.e. a principle that for every new regulation introduced, X deregulatory measures should be pursued.


To the extent that a "common law" approach refers to one embodying flexibility and pragmatism, this is likely to be welcomed by many businesses – but as explained in the Overview above, more attention may need to be paid to ways in which regulation can provide businesses with greater certainty about their level of risk. It is also hard to disagree with the general propositions that regulation should be proportionate and regulators held accountable. However, the consultation paper does not contain much discussion of potential enforcement or accountability mechanisms; for example, is it envisaged that businesses should be able to challenge regulations in court on the basis of the proportionality principle?

We are sceptical about the feasibility of regulatory offsetting; for example, it is hard to see how it would work in the tech sector, which has historically been lightly regulated but which now faces a number of measures being introduced in response to public concerns about the impact of larger tech firms (see Data and Tech). Lastly, it is possible that, faced with real world examples such as this, the Government may conclude that there are limits to a "one size fits all" approach and that different areas of regulation require differing approaches, depending on what is at stake.

Climate and environment

As it prepares to lead the climate negotiations at COP26 in Glasgow in November, we might have expected a more aggressive climate agenda from the Government (note: there is still time). We have seen the Committee on Climate Change criticise the Government for lack of concrete actions, though the Government has increased the UK's overall greenhouse gas reduction target.

Sustainable finance: a departure from the EU approach

In the area of sustainable finance, the UK is starting down its own path rather than following the EU. The Government has announced that it will require climate disclosures under the internationally recognised TCFD regime with requirements in place for many organisations from 2023. It will also prepare its own rules on sustainability disclosures and work towards a green taxonomy optimised for the UK market. See further the Corporate and M&A section.

In addition, the Government has requested advice from the Competition and Markets Authority on how it can best achieve its environmental goals in relation to competition and consumer policy – see the Competition section.

Environmental licensing and permitting regime

In its response to the report of the Taskforce on Innovation, Growth and Regulatory Reform (TIGGR), the Government highlighted moves to rationalise the existing environmental licensing and permitting regime. A consultation took place earlier this year on a new approach to defining the "Best available Techniques" - a key tool by which the Government controls emissions and environmental impacts by industrial environmental permit holders (following Brexit). More recently, the Government has also consulted on groundwater activities and water abstraction and impounding, the latter intended to be brought within the environmental permitting regime for the first time.


Also in the response to the TIGRR report (see above), the Government indicated that it expected to issue a consultation shortly on plans to implement "Biodiversity Net Gain" (BNG), which is intended to be a flexible, market-based trading system for biodiversity offset credits.


The UK Government has launched a raft of consultations proposing far-reaching reforms to the competition law space in the UK. The proposals include substantial changes to:

A short consultation has also been launched, proposing amendments to CMA guidance to ensure that parties agree, when settling Competition Act investigations into anti-competitive agreements, that they will not subsequently appeal the CMA's decision.

The UK Government is simultaneously consulting on specific proposals to govern the digital technology sphere, including enhanced scrutiny of mergers involving 'Big Tech' and powers for the new Digital Markets Unit within the CMA).

Competition policy and environmental goals

Alongside these consultations, the Secretary of State for Business, Energy and Industrial Strategy has written to the CMA to request its advice on how the UK can better use the tools available under competition and consumer law to achieve the government’s net zero and sustainability goals. That advice is due by early 2022. The CMA has launched a call for inputs from business and other stakeholders to help inform its response.

Given the far-reaching nature of the proposals put forward, and the time that Government has taken to reach this stage (since the earlier proposals from Lords Penrose and Tyrie and the Furman Report), the outcome of all these initiatives will be keenly awaited.

Consumer protection

The Government is consulting on plans to reform consumer law, including giving regulators powers to impose fines of up to 10% of global turnover for breach of consumer legislation. If implemented, these changes are likely to result in a significantly tougher regulatory environment for consumer-facing businesses.

Consumer protection and the tech sector

Alongside these reforms, the Government is also consulting on a number of measures with implications for consumer-facing businesses in the tech sector, notably a new competition regime for digital markets and draft legislation designed to increase protection against "online harms". The Government has also consulted on new rules for "Consumer Connected Devices", also known as the "Internet of Things". The timing for publication of draft regulations governing the safety of this type of product is not yet clear.

Corporate and M&A

Corporate governance and audit reform

In March 2021 the government published a consultation on restoring trust in audit and corporate governance – for more on this, see our Travers Smith Alternative Insights Article on reporting by large private companies. Responses to this consultation have now been submitted, including a joint response from the CLLS and the Law Society. In summary, the responses are broadly supportive of the government's proposals and the need to address audit quality and corporate governance, but there is a general concern as to the proportionality of the proposals, which are not seen to be sufficiently focussed on the areas of greatest risk, measuring these against the cost to companies of compliance with the proposals. We await the Government's response to this consultation.

Corporate transparency and register reform consultations

Significant changes to UK company legislation can be expected in response to a package of reforms put forward by the Government in various consultations aimed at enhancing the role and powers of the Registrar of Companies, increasing the transparency of UK corporate entities and tackling economic crime.

After an initial consultation in 2019 on options to enhance the role of Companies House and increase the transparency of UK corporate entities, the Government published three consultation papers in December 2020 setting out proposed reforms in relation to the powers of the Registrar of Companies, improving the quality of financial information on the UK Companies Register and implementing a ban on corporate directors. All three consultations closed in February this year and we await the Government's response.

What is being proposed?

Broadly, the Government's latest proposals include:

  • identity verification: introducing compulsory identity verification for all directors, People with Significant Control and those filing information on behalf of a company
  • reforms to Companies House powers: providing the Registrar of Companies stronger powers to query, seek evidence for, amend or remove information and to share it with law enforcement partners when certain conditions are met
  • protecting personal information: improving the processes for removing personal information from the register
  • company accounts: proposing further consultation on how to introduce full digital tagging of accounts to ensure consistency, easier identification and comparability of information on the register
  • prohibition on corporate directors and exception: bringing forward regulations for the commencement of the prohibition on corporate directors under SBEEA 2015 and creating a principles-based exception to the prohibition

Another related consultation paper was published in July this year (closing on 14 October 2021) on Amendments to the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017 Statutory Instrument 2022). The initiatives outlined above are not primarily driven by Brexit (whereas those listed below can reasonably be characterised as relating to the UK's departure from the EU).

Shake-up of UK listing and prospectus regimes post-Brexit

In March 2021 HM Treasury published the UK Listing Review report setting out the Government's recommendations following the UK listing regime chaired by Lord Hill. The report identified an urgent need to reform the Listing Rules and the prospectus regime to ensure the UK remains efficient, attractive and competitive post-Brexit. For further information, see our briefing on Listing Review Recommendations. With Brexit prompting a fresh examination of the UK listing regime (and, in particular, a drive to tailor it to meet the needs of the UK market), and in the wake of critics accusing London of having lost its appeal, we are likely to see a radical shake-up of the prospectus and listing regimes following the recent FCA consultations which have subsequently been published:

Recent FCA consultations on the listing and prospectus regimes

  • a consultation in April on the rules relating to special purpose acquisition companies (or "SPACS"), which resulted in changes to the Listing Rules for SPACs from 10 August 2021 – the new rules remove, for SPACs fulfilling certain criteria, the long-standing presumption that trading in SPAC shares will be suspended once a de-SPACing transaction is announced, which has been seen as an unnecessary obstacle to the success of such transactions;

  • a consultation in July on a review of the UK prospectus regime which was inherited from the EU - for further details please see our briefing on the UK prospectus. The proposals appear to remove some of the less logical constraints imposed by the EU Prospectus Regulation, minimising legislation and allowing the FCA freedom to act more nimbly in deciding when a prospectus is actually necessary, and when investors are adequately protected by market information or other means. This consultation closed on 24 September 2021 and we await feedback;

  • a consultation in July on the effectiveness of the primary markets – for further details, please see our summary briefing. This consultation, which discussed four possible models for the listing regime and is potentially far-reaching in scope, closed on 14 September 2021 and the FCA hopes to announce the new rules by "late 2021".

For further commentary on these changes and on ECM trends and statistics generally, please see our ECM publication.

Climate-change reporting

In June 2021 the FCA  launched two consultations on extending the application of the new Listing Rule which currently requires premium-listed companies to make disclosures in accordance with the TCFD on a "comply or explain" basis. Under the proposals, this rule will be extended, still on a comply or explain basis, to: (i) asset managers, life insurers and FCA-regulated pension providers; and (ii) organisations with standard listed equity shares (excluding standard listed investment entities and shell companies). Further information on these consultations and their potential application can be found in our disclosures briefing.

Dematerialisation of shares

The Government has stated that it wishes to move away from shares being held in paper form (the majority are already held in electronic form). It plans to work with industry, regulators and shareholders to determine the best mechanism for converting paper shares into electronic form, whilst preserving the rights of existing shareholders.

Although this proposal has been presented by the Government as taking advantage of new freedoms available outside the EU, the reality is that the EU Central Securities Depositories Regulation requires securities traded on EU markets to be held in uncertificated (dematerialised) form from January 2023 for new securities, and January 2025 for existing securities (so had the UK remained in the EU, dematerialisation would still have happened). That said, the consultation will enable the UK to decide for itself how best to achieve dematerialisation - so in that somewhat narrower sense, it is accurate to portray this as an exercise of newly regained sovereignty.

Data & tech

Data protection: divergence from the EU?

Despite concerns that it could lead to suspension or withdrawal of the EU's adequacy decision in respect of the UK, the Government has announced plans to reform UK data protection law so as to "create a new world-leading data regime that unleashes the power of data across the economy and society." With this in mind it launched its consultation headed 'Data: a new direction' on 10 September. The ambition is to encourage greater (though responsible) use and sharing of data for the purpose of research and innovation; take a more risk based approach; tailor compliance requirements depending on the level and nature of data processing that an organisation carries out; and make it easier for personal data to flow cross border. This is an area where, as noted above, divergence from the EU approach could increase red tape; in particular, if the EU were to withdraw its adequacy decision in respect of the UK, additional steps would need to be taken in relation to the transfer of personal data from the EEA to the UK (see this briefing).

ICO consultation on standard contractual clauses

The Information Commissioner's Office is also mid-consultation, on its version of standard contractual clauses – its proposed international data transfer agreement and accompanying transfer risk assessment toolkit for the transfer of personal data to third countries under UK GDPR. This draws to a close on 7 October. For further details please see our briefing.

National AI strategy

The Government recently published its National AI Strategy, which sets out the Government's 10 year plan to "make Britain a global AI superpower". Given the heavy reliance of AI technologies on the use of personal data to help to develop and train technology, the strategy not surprisingly includes objectives over the short term (i.e. the next three months), to determine the role of data protection in wider AI governance (which will dovetail with the DCMS consultation on data protection reform), and over the medium term (ie the next 6 – 12 months), to publish a White Paper on a pro-innovation national position on governing and regulating AI.

Regulation of online content

The Online Safety Bill, which creates a legal framework to make social media platforms and search engines more responsible for user generated illegal and harmful content which appears on their sites, is currently being examined by a pre-legislative joint committee of the House of Lords and the House of Commons, which will report back in early December. There are expectations that the Bill will be presented to Parliament next Spring.

New competition regime for digital markets

As is the case in a number of other major jurisdictions, including the US and the EU, the Government is concerned about ensuring and promoting competition in the digital market, and ensuring that the market is not dominated by a handful of large tech giants. To this end the Government launched a consultation in the summer setting out reforms aimed at "driving greater dynamism in the UK's tech sector, empowering consumers, and driving growth across the economy", with proposed measures such as designating certain companies as having strategic market status and compiling a mandatory code of conduct for them to follow.

"Internet of Things"

In the Queen's Speech in June, the Government included proposals to legislate to create a legal obligation of 'security by design' in respect of consumer Internet of Things connected devices.

Whilst the consultation on data protection is clearly related to Brexit, most of the other consultations noted above are not (although they are broadly in line with regulatory trends in other major developed economies).


Employment law is one area where we have not seen a flurry of proposed reform in the wake of the pandemic or Brexit. This is perhaps not surprising given the Government's pledge that Brexit would not lead to a worsening of workers' rights. It is also consistent with the commitments in the Trade and Cooperation Agreement with the EU to maintain certain standards in relation to labour and social policy. However, there are a number of recent or outstanding employment law consultations which are worth highlighting:

Post-termination non-competes

During the winter of 2020/2021 the Government consulted on proposals to reform post-termination non-compete covenants in employment contracts. The proposal is not linked to Brexit but is designed to support economy recovery in the wake of the pandemic by creating an environment that facilitates competition. The Government has yet to respond to the consultation to set out its plans in this area.

Ethnicity pay-gap reporting

In 2018/2019, the Government consulted on introducing mandatory ethnicity pay gap reporting for large organisations. Although the consultation has been outstanding for some time, the Government has come under mounting pressure to act in this area and, in September 2021, the Government confirmed that it is considering consultation responses and will respond to the consultation "in due course". This measure is not linked to Brexit but is tied to the Government's broader social justice agenda.

Sexual harassment

In July 2021, the Government responded to an earlier consultation on sexual harassment in the workplace to confirm that it will introduce a positive duty on employers to prevent workplace sexual harassment, as well as protections from third party harassment. The Government has not given a timeframe for these changes. Again, the changes are independent of Brexit and are likely to lead to an increase, rather than decrease, in regulatory burdens on businesses.

Flexible working

On 23 September 2021, the Government published a consultation on making flexible working the default position by allowing employees to request flexible working from day one of employment. The consultation is open until 1 December 2021. The proposals were not prompted by Brexit but fulfil a 2019 election manifesto commitment from the Conservative Party, which was delayed due to the COVID-19 pandemic.

Employee share incentives

On 3 March 2021, HM Treasury published a call for evidence seeking views on how the tax-advantaged employee share incentive arrangement known as Enterprise Management Incentives (EMI) could be modified (see the Tax section for more information). Some of the restrictions that limit the companies able to offer EMI derive from EU State Aid rules.

Energy and Infrastructure

In April, the report of the  Taskforce on Innovation, Growth and Regulatory Reform (TIGGR) made a number of recommendations about energy and infrastructure, notably regarding creation of a "smart energy grid", adoption of net zero technologies and attracting private investment to help regenerate local infrastructure.  In its recent response to that report, the Government highlights the following initiatives:

Data initiatives

The Government has announced the next phase of its plans to digitally map underground assets, together with plans to facilitate access to building attribute data held by the Valuation Office Agency. It is hoped that both initiatives will lead to increased efficiencies. However, although presented by Government as a post-Brexit opportunity, it is not immediately evident what these initiatives have to do with leaving the EU.

Financial services

With apparently limited progress having been made in discussions with the EU over financial services equivalence, the UK Government appears to be focussing instead on reforming UK financial services regulation. For example, in its recent response to the report of the Taskforce on Innovation, Growth and Regulatory Reform (TIGGR), the Government highlights a number of initiatives which, in its view, herald a move away from "inflexible and overly restrictive" EU regulation. These include:

The TIGGR report also highlighted the potential for regulation of UK pension and insurance funds to be amended – see further Pensions below and the FCA has been consulting on post-Brexit reforms to the UK listing and prospectus regimes - see further Corporate and M&A above. 

LIBOR reform

The FCA has published a consultation on its proposed decision to use powers under the Benchmarks Regulation (BMR) that will be introduced by the Financial Services Act 2021. This power will enable it to require the LIBOR administrator, IBA, to change the benchmark’s methodology. The consultation is a key step in ensuring an orderly wind down of LIBOR.

Intellectual property

Exhaustion of rights

In June the Government launched a consultation on the UK's future exhaustion of intellectual property rights regime. Prior to Brexit the UK was part of the EU's exhaustion of rights regime, which meant that any goods legitimately placed on the market in the EU could be freely traded and exported into the UK without the need to seek consent from the holder of the intellectual property rights in the goods. This is because such rights were treated as 'exhausted', as soon as the goods hit the EU market. This regime is still in place, however, it is no longer reciprocal, so that any goods which are placed on the market in the UK, can only be exported into the EU  if the holder of the intellectual property rights consents to this.

The consultation looks at whether this should remain the case, and if not, what regime should replace it, and to what degree: the narrower the regime, the better for IP rights holders such as authors and publishers; the wider the regime, the better choice and competition there will be for consumers.

Protecting IP related to artificial intelligence

The Government recently published its National AI Strategy, which sets out the Government's 10 year plan to "make Britain a global AI superpower". Part of this plan includes, over the course of the next three months, the launch of a consultation on copyright and patent protection for AI, which will be run by the Intellectual Property Office.


The pandemic has coincided with an enormous number of consultations (most now concluded) and reforms affecting occupational pension schemes and their sponsoring employers, primarily from the Government and the Pensions Regulator. These can broadly be split into four policy themes:

Protecting defined benefit scheme members

The Pension Schemes Act 2021 is in the process of being brought into force and a number of consultations have resulted in regulations and Pensions Regulator publications.  Many aspects are designed to improve benefit security for defined benefit (DB) scheme members.  There are implications for scheme funding and corporate activity where there is a DB pension scheme, and new requirements for trustees of all schemes. 

Key aspects and commencement dates are as follows.

•    Changes to the DB scheme funding regime, requiring a long-term funding and investment strategy, and new valuation expectations in a revised Pensions Regulator code of practice (date not confirmed but currently expected to commence in late 2022 or early 2023).  Consultations are expected soon on draft regulations and the new code.

•    New grounds for the Pensions Regulator to issue a contribution notice, requiring an employer or associated or connected party to make a lump sum contribution to a DB scheme, including where an act or omission would, hypothetically or actually, reduce the amount of 'section 75' employer debt likely to be recovered by the scheme from the employer in the event of insolvency (1 October 2021).

•    New criminal offences and civil penalties up to £1 million, including for acts or omissions by anyone (not just associated or connected parties) which put DB scheme members' benefits at risk, without a reasonable excuse (1 October 2021). The Pensions Regulator's prosecution policy has been finalised and a consultation is currently open (until 21 December 2021) on three draft other policies in this area.

•    Requirements to notify the Pensions Regulator and DB scheme trustees, including at an early stage and later a declaration of intent, in connection with certain kinds of corporate activity – to include material business sales and the granting of security with priority over debt to the scheme (likely to be April 2022). A consultation closes on 27 October 2021.

•    Scam protections, in many cases restricting the statutory transfer right and requiring trustees to ensure that the member takes guidance (date not confirmed but currently expected to be November 2021).

For more detail on the Act (including other aspects not covered here), please see our briefing.

Climate change

The largest occupational pension schemes and all authorised master trusts are at the forefront of the new TCFD (Taskforce on Climate-related Financial Disclosures) obligations. Legislative changes (also made by the Pension Schemes Act 2021) have introduced governance and public disclosure requirements for occupational pension scheme trustees based on the TCFD recommendations. 

These take effect from 1 October 2021 for schemes with £5 billion or more in relevant assets and authorised master trusts and from 1 October 2022 for schemes with £1 billion or more.  There is no confirmed date for smaller schemes but in time they too may be affected. These requirements are likely to impact scheme investment and funding/employer covenant strategies.

Statutory and non-statutory guidance have been published, to help schemes with their obligations. Final Pensions Regulator guidance is awaited. For more information, see the Pensions section of our Sustainable Business Hub.

Improving outcomes for defined contribution scheme members

Various new measures are being introduced with the aim of improving the governance of defined contribution (DC) trust-based schemes and otherwise to improve outcomes for members. Increased governance requirements and the associated costs are leading many employers with trust-based DC schemes to consider transferring the scheme to a master trust.  The recent and forthcoming changes include the following:

•   The annual chair of trustees' governance statement will have to disclose investment returns net of charges in all default and also non-default funds (from 1 October 2021).

•   The annual chair's governance statement and the scheme return to the Pensions Regulator will need to include a report on a 'value for members' assessment, for schemes with assets of less than £100 million operating for at least three years.  This is intended to push smaller schemes towards consolidation.  It applies in respect of the first scheme year to end after 31 December 2021. The Pensions Regulator and FCA have published a joint discussion paper on a framework for assessing value: comments can be submitted until 10 December 2021.

•   A ban on the charging of flat fees on default fund pots of less than £100 (expected to be from April 2022), possibly to be followed by a ban on flat fees altogether.

•   Expected requirements for trustees to give a "stronger nudge" to Pension Wise guidance when members who are age 50 or over apply to take or transfer their DC benefits other than for the purposes of consolidation, unless the individual opts out of it (expected to take effect from April 2022).

•   Simplified, two-page benefit statements are expected to be required (from April 2022).

A recent call for evidence requested information about barriers to greater DC scheme consolidation, so further measures may be expected. This was aimed at schemes with assets between £100 million and £5 billion but the Pensions Minister said that he does not intend to stop at £5 billion.

Harnessing pension scheme assets to help 'build back better'

The report of the Taskforce on Innovation, Growth and Regulatory Reform (TIGGR) earlier this year highlighted the potential for regulation of UK pension and insurance funds to be amended so as to facilitate investment in a wider range of assets, with a view to supporting economic growth in the UK. 

In August, The Prime Minister and Chancellor of the Exchequer wrote an open letter to institutional investors, including pension schemes, calling for an "Investment Big Bang" to drive recovery and boost Britain's long-term growth. It encourages more investment in long-term UK assets, "giving pension savers access to better returns and enabling them to see their funds support an innovative, healthier, greener future for their country".

The industry working group on productive finance has recently produced a report on how DC schemes can "benefit from appropriate long-term opportunities". DC schemes face particular challenges in investing in illiquid assets. Connected to this, there have been legislative changes to allow the smoothing of performance fees over five years when assessing DC scheme charges against the cap, aimed at helping such schemes to invest in venture capital and growth equity.

Other consultations of note

Some other consultations of note include the following:

  • Pensions Regulator single code and own-risk assessments: The Pensions Regulator has consulted on a draft 149 page consolidated code of practice, bringing together in shorter and updated form 10 of its current 15 codes – mainly those concerning scheme governance and administration. New content in various parts of the draft code is intended to meet the Regulator's obligation to produce a code of practice in relation to the requirement for schemes to have an 'effective system of governance', including (under regulations and only for schemes with 100 or more members) the carrying out and documenting of an annual 'own-risk assessment'.  It is not currently known when this will take effect.

  • 'Normal minimum pension age': HM Treasury has consulted on draft legislation to raise the 'normal minimum pension age' under the Finance Act 2004 from 55 to 57 on 6 April 2028, with some protections. This is the lowest age at which benefits can generally be taken without incurring an unauthorised payments tax charge.  Industry responses highlighted a number of issues.

  • Pension protection levy: The Pension Protection Fund is consulting until 9 November 2021 on proposals for the 2022/23 pension protection levy payable by eligible DB pension schemes.

  • Pensions dashboards: Starting perhaps in 2023, there should be a 'dashboard' (and later more than one) where individuals can check on all of their pension entitlements in one place, to include occupational pensions, personal pensions and the state pension.  Schemes and providers will be required to provide data. The Pensions Dashboards Programme recently called for input on proposals for staging those obligations.  A Government consultation on draft regulations is expected before the end of the year.
Product regulation

Medical devices

The Government has launched a review of medical device regulation with a view to having a new framework in place (potentially diverging from EU regulation in some areas) from July 2023.  The Medicines and Healthcare Regulatory Agency is also reviewing the status of software and artificial intelligence as a medical device.

Clinical trials

In June 2021, the Government published an implementation plan for UK clinical research delivery, which envisages changes to the way that clinical trials are conducted in the UK.  The ambition is to reform the process of testing potential new medicines and treatments with a view to promoting the UK as a an attractive destination for carrying out research into pharmaceuticals and other health-related products, in line with the recommendations of the Taskforce on Innovation, Growth and Regulatory Reform (TIGGR) earlier this year.

Public procurement

The Government is considering possible changes to the public procurement regime. However, as we have pointed out previously, its room for manoeuvre is somewhat constrained by its participation in the WTO Government Procurement Agreement and commitments it has made in trade agreements with the EU and Japan.  As a result, radical reform seems unlikely to be on the cards.

Real Estate

Building safety defects: responding to Grenfell

As part of the Government's process of introducing a range of measures to remedy historical building safety defects in the light of the Grenfell Tower tragedy, in July the Government issued a building safety levy consultation, which we discussed in our briefing here.

Also in July (and also in response to Grenfell), the Government launched a consultation on a new residential property developers' tax (RPDT), which we discussed at the time in our briefings here and additionally, in the context of the retirement living sector, here. That consultation exercise has since closed and the Government is now consulting on draft legislation. The precise scope of the charge has not yet been finalised (in particular, whether or not Build to Rent and affordable housing are within scope). It is proposed that RPDT is charged, from April 2022, on the profits of companies within the charge to corporation tax, undertaking UK residential property development activities (unless excluded) and which exceed an annual allowance. The tax rate and amount of annual allowance (previously proposed to be £25m) are expected to be confirmed in the Autumn Budget on 27 October.

Future of the moratorium on commercial lease evictions

In August, the Government launched a consultation about the withdrawal or replacement of the moratorium on commercial lease evictions and the use of CRAR; our briefing on the outcome is here.

Data initiatives

The Government has announced the next phase of its plans to digitally map underground assets, together with plans to facilitate access to building attribute data held by the Valuation Office Agency. It is hoped that both initiatives will lead to increased efficiencies.  However, although presented by Government as a post-Brexit opportunity, it is not immediately evident what these initiatives have to do with leaving the EU.

Retained EU law

The Government has announced that it plans to review the status of retained EU law ("REUL") (see pages 12-13 of this document). There are two aspects to this:

  • Retained EU case law: the Government is considering whether to extend the power to depart from retained EU case law to all UK courts. The current position is broadly that only CJEU judgments up to 31 December 2020 remain binding on the UK courts, but the Supreme Court and the Court of Appeal (together with courts at the same level as the CA) may decide to diverge from it. In doing so the Government is revisiting the decision reached only last year that the benefits of extending the right to diverge to lower courts would be outweighed by the negative impact on legal certainty.

  • Retained EU legislation:  currently, REUL takes precedence, in the event of a conflict, over other UK legislation on the same subject matter.  This was intended to promote certainty. However, the Government is revisiting the concept of ‘supremacy of EU law’ in respect of REUL, considering how to allow REUL to be challenged and potentially, changes to the substantive content of REUL. It may also look to re-designate certain pieces of REUL to indicate whether they should be regarded as "primary" or "secondary" legislation in terms of the UK statute book.
State aid / subsidy control

Following a consultation earlier in 2021, the Subsidy Control Bill is now before Parliament.  

Whilst the proposed new UK-specific regime will be different from EU state aid law in a number of important respects, there may well ultimately be more similarities than differences on matters of substance – and as explained in this briefing, the Government's room for manoeuvre on state aid law following Brexit is somewhat constrained by the Trade and Cooperation Agreement with the EU.


Asset holding companies

The UK government is consulting on draft legislation for a new tax privileged regime for asset holding companies. In order to qualify for the regime, the asset holding company must meet several eligibility criteria including that it is 70% owned by "good" investors (such as diversely owned funds). The new asset holding companies regime is expected to come into force in April 2022.

Notification of uncertain tax treatment

It is proposed that a new set of rules will be introduced from April 2022 which will require large businesses to notify HMRC if they have adopted a tax treatment that is "uncertain". The UK government is currently consulting on draft legislation and guidance for these rules.

Residential Property Developers' Tax

In July 2021, in response to the Grenfell Tower tragedy, the Government launched a consultation on a new residential property developers' tax (RPDT), which we discussed at the time in our briefings here and additionally, in the context of the retirement living sector, here. That consultation exercise has since closed and the Government is now consulting on draft legislation. The precise scope of the charge has not yet been finalised (in particular, whether or not Build to Rent and affordable housing are within scope).  It is proposed that RPDT is charged, from April 2022, on the profits of companies within the charge to corporation tax, undertaking UK residential property development activities (unless excluded) and which exceed an annual allowance.  The tax rate and amount of annual allowance (previously proposed to be £25m) are expected to be confirmed in the Autumn Budget on 27 October.

Employee share incentives: EMI Call for Evidence

Enterprise Management Incentives (EMI) are a form of tax-advantaged share incentive award that provide a flexible, effective and affordable way for entrepreneurial companies to remunerate their employees.  Not all companies are able to meet the statutory conditions to grant EMI, some of which derive from EU State Aid rules.  At Budget 2020, the government announced that it would review the EMI regime to examine whether it should be accessible to more companies.  In March 2021, HM Treasury published a call for evidence seeking views on how EMI could be expanded.  The existing regime is limited to companies with gross assets of no more than £30 million and with fewer than 250 employees.  It will be interesting to see whether the review (to which Travers Smith responded) will result in an increase to these limits and a modification of other restrictions that companies wishing to offer EMI often encounter. Any extension of the scheme will need to be in line with the UK's international subsidy control commitments and its proposed new domestic subsidy control regime.


The Government has announced the following initiatives:

  • Aviation: It is proposing to "remove unnecessary and burdensome EU requirements on the General Aviation sector (non-scheduled aircraft) – including on crew licensing, airworthiness maintenance and medical requirements."  It is also proposing changes to air passenger consumer rights, although here it will need to ensure that it acts consistently with its commitments in the UK-EU Trade and Cooperation Agreement.

  • Road transport: It is exploring the possibility of private sector testers to undertake heavy vehicle MOT testing (as they do for car and van testing).  This could offer new commercial opportunities for testing providers.  It is also promising digital versions of driving licences, test certificates and MOT testing processes.

  • Port services: It plans to repeal the EU Port Services Regulation, which has been retained as part of UK law following Brexit.  However, it has only committed to doing this "when legislative time allows".

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