Regulation Around the World: 2025 Global Horizon Scanning

In this issue of Regulation Around the World we look at some of the key regulatory topics for 2025 in the following jurisdictions: United Kingdom, EU, France, Germany, Luxembourg, Netherlands, Italy, UAE, South Africa, Australia, Hong Kong, Singapore, Australia and China. We have not attempted to list every single reform expected this year but rather we pick out some of the key reforms to be aware of.

The key question that regulators around the world are asking is what lies ahead for financial services in the United States during Donald Trump’s second term. Three common themes seem to have already appeared – deregulation, more fintech friendly policies and less support for climate related initiatives.

In terms of deregulation it is, for example, expected that the Biden administration’s Basel III endgame proposal will be scrapped or substantially revised. The impact of this has already been seen in the United Kingdom where HM Treasury has recently announced that it will be delaying its own implementation of the final Basel standards so as to give it more time to see what plans emerge from the other side of the Atlantic. Whether other jurisdictions follow suit remains to be seen although this is expected.

Outside of Basel III many jurisdictions will see further regulatory initiatives this year adding to the compliance burden. In some cases, like South Africa and the expected finalization of the Conduct of Financial Institutions Bill, regulation will undergo fundamental change. In other jurisdictions, like Europe, 2025 will see both a continuation of existing legislative initiatives (for example, the review of the Securitisation Regulation and the Retail Investment Strategy) and new legislative initiatives (for example, the review of the Benchmarks Regulation).

President-elect Trump vowed to make the United States the “crypto capital” and to end the “persecution” of the crypto industry. In Europe, crypto regulation is at a fairly advanced stage with the Markets in Crypto-Assets Regulation already in force and in 2025 many crypto asset service providers will move to this regime following their Member States’ transitional period expiring. Other jurisdictions like the United Kingdom will be issuing later this year legislation that will define the extent to which crypto-assets are regulated. A similar story can be found in Hong Kong with the finalization of the draft Stablecoins Bill which was published near the end of last year. In Dubai, the regulators are expected to have some level of industry engagement this year on tokenization and particularly real-world asset tokenization.

Outside of crypto assets operational resilience will continue to be an important theme in 2025. In Europe, the Digital Operational Resilience Act, or DORA, has recently come into force and firms will be focusing on their reporting obligations and the final level 2 and 3 measures that are outstanding. Operational resilience will also be an important theme in the United Kingdom particularly as regards critical third parties and by May 2026 all banks in Hong Kong are expected to become fully resilient. Regulators will continue to focus their attention on artificial intelligence too with, perhaps, Asia leading the way in this area. There have already been papers from various regulators on managing risks and governance over artificial intelligence models and more is expected.

Some regulators like the German BaFin and the Dutch AFM have warned that geopolitical risk is a key risk for firms in 2025. One area that BaFin has been assessing is whether the loans issued by certain financial institutions are concentrated in particular regions, industries or companies that are affected by difficult geopolitical circumstances.

The United States’ retreat from ESG related regulation is expected to be the exception rather than the norm. Climate disclosure requirements will come into force in 2025 for many financial services firms. Many jurisdictions, notably the EU, the United Kingdom and countries in Asia, have adopted requirements aligned with the International Sustainability Standards Board's climate disclosure standard (IFRS S2). Some jurisdictions will also be considering their own taxonomy.

A further common theme in many jurisdictions in 2025 will be anti-money laundering / countering the financing of terrorism (AML/CTF) regulation. For example, in the EU firms will be starting their preparations for a new AML regime which includes a directly applicable Regulation and a new Anti-Money Laundering Authority. Whilst the new EU AML/CTF regime will not come into immediate effect there are steps that firms should consider in 2025 in order to prepare. In Australia the Australian Reports and Analysis Centre will be collaborating with industry to implement the changes introduced by the Anti-Money Laundering and Counter-Terrorism Financing Amendment Act 2024 which the Parliament of Australia passed late November 2024. Australia’s new tipping off offence also commences on March 31, 2025. China’s amended Anti-Money Laundering Law took effect from January 1, 2025 and includes extra-territorial provisions.

Download full updater