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The Competition and Markets Authority (CMA) published an update on the governance of the Open Banking Implementation Entity and announced it will publish another consultation by the end of this year/early 2022.

Investigation findings

An investigation into the governance of OBIE concluded that the CMA, and the nine retail banks who helped establish OBIE, must accept their share of responsibility for not putting in place stronger governance mechanisms from the outset, for lack of attention to issues of governance throughout the programme and for not improving the governance when it became clear that the project was becoming more complex and far longer than originally anticipated.

The CMA has therefore announced the following measures:

• Imran Gulamhuseinwala has tendered his resignation as Open Banking Implementation Trustee and Chair
• Charlotte Crosswell has been nominated as the replacement Implementation Trustee and Chair, to lead the planned transition to the future arrangements for Open Banking
• New non-executive Directors will be appointed to the OBIE board as a priority, to provide appropriate independent scrutiny and oversight
• Kirstin Baker, an independent non-executive Director of the CMA, has been appointed to lead a review to identify the lessons for the CMA in its approach to designing, implementing and monitoring remedies in its market investigations. The findings of this review will be published

The investigation was published as the CMA was about to update industry on its consultation which closed earlier this year. The CMA decided to postpone any further announcement to later this year/early 2022 and announced that another consultation will be published.

Key principles for future governance

As part of the latest update and ahead of the next consultation, the CMA highlighted a number of high-level principles to provide an initial steer on some of the key areas they are considering, which they hope will be a helpful signal for the industry.

The list of principles mentioned by the CMA include:

• Purpose – competition and innovation: deliver on Open Banking’s full potential as a key driver of competition in retail banking as envisaged by the remedy
• Regulatory collaboration and oversight: sufficient regulatory oversight of the future entity, including close collaboration between regulators and the ability for regulators to set expectations and prioritise appropriate interventions when necessary
• Stakeholder interests: sufficiently and fairly represent and take account of all relevant industry participants and end-users
• Funding: a more broadly-based and sustainable funding model, particularly in respect of ‘membership’ contributions

techUK welcomes the general principles put forward by the CMA and looks forward to responding to the upcoming consultation. Find out more and read techUK’s response to the CMA’s consultation.