June 18, 2020

Fintech Regulation: French Autorité de contrôle prudentiel et de résolution (ACPR) and New York Department of Financial Services (NYDFS) Signal Growing Cooperation

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On June 3, 2020, the French Autorité de contrôle prudentiel et de résolution (“ACPR”) and the New York State Department of Financial Services (“NYDFS”) (collectively, “the Authorities” and individually, “Authority”) announced the signature of a Memorandum of Understanding (“MOU”) intended to “ease entry for fintech innovators into the French and New York markets.”1 This is the first cooperation agreement on fintech concluded by the ACPR with a U.S. regulatory authority.

The agreement signed with the NYDFS complements the international cooperation agreements in the field of fintech signed by the ACPR with other authorities outside Europe, such as with authorities in Singapore,2 Hong Kong,3 South Korea,4 Japan5 and Taiwan.6 The NYDFS has also entered into agreements with other foreign regulators with the goal of promoting cross-border cooperation in regulatory oversight. For instance, in 2019 the NYDFS signed a MOU with Israeli financial supervisors on fintech cooperation,7 reflecting a growing trend in cross-border cooperation agreements between regulators.

In the new MOU, the ACPR and the NYDFS commit to: “refer fintech innovators to each other, which can improve speed to market; exchange information about regulatory and policy issues; ensure that innovators in each other’s jurisdiction receive equivalent levels of support; and share regulatory and supervisory expertise and best practices.” 8

I. Referral Mechanism

Article 5.1 of the MOU provides a referral mechanism to facilitate the entry into and operation of “Financial Innovators”9 and fintechs in both markets. Specifically, the Financial Innovator will be able to submit a written request to one Authority (“the Referring Authority”) to operate in the other Authority’s jurisdiction (“the Receiving Authority”). The Referring Authority may then refer the Financial Innovator to the Receiving Authority and offer support, where appropriate.

II. Information Sharing

Article 5.2 of the MOU states that the Authorities will share information regarding “regulatory, supervisory, and policy issues on innovation in financial services,” as well as “emerging market trends and developments,” and any other fintech-related relevant issues.10

III. Support to Financial Innovators

Article 5.3 of the MOU calls on each Authority to provide Financial Innovators from other jurisdictions with the same level of support that it provides to its own Financial Innovators.11 This support includes access to a contact person, information on local regulatory and supervisory frameworks, and assistance during the authorization application phase.

IV. Dialogue on Fintech and Innovative Financial Services

Article 5.4 of the MOU states that representatives of each Authority will meet through different means when necessary to discuss “fintech and innovative financial services” trends and issues.12 An invitation to these meetings may also be extended to representatives of Financial Innovators when agreed upon by both Authorities.

V. Expertise Sharing

Article 5.5 of the MOU encourages staff from each Authority to conduct trainings with the other Authority in order to promote the sharing of best practices.13 Nonetheless, Confidential Information14 relating to an innovative enterprise “will only be disclosed by the Authorities and shared between them” subject to the prior written consent of the innovative enterprise. However, the use of this confidential information is regulated and subject to local restrictions, since “Transfer of Confidential Information about the Financial Innovator under this Memorandum of Understanding remains subject to the provisions of any law applicable to the Authorities from both jurisdictions.”15

VI. Practical Considerations

While the MOU signals growing cooperation between two influential regulators in two of the world’s most important economic capitals, some key practical considerations for Financial Innovators will include:

  • Assessing the potential benefits associated with these jurisdictions due to increased information sharing and close cooperation between French and U.S regulators. Both Paris and New York have made significant efforts in recent years to attract innovation and investment in the fintech sector. The MOU is expected to further strengthen the business ties between these two competitive financial markets, both of which have access to significant venture capital;
  • Enabling New York-regulated fintechs to access the EU market more easily through France, given the expected harmonization of supervisory rules;
  • Determining what Confidential Information the Financial Innovator may not wish to permit its Authority to share with the other Authority. The Authority will need a written authorization to share information related to its obliged Financial Innovators. It is thus the Financial Innovator’s responsibility to define the scope of information that can be shared with the other Authority;
  • Evaluating the risks associated with the potential sharing of information between the Authorities; and
  • Defining the role and responsibilities of representatives of Financial Innovators in charge of communicating and attending meetings with both Authorities when necessary. These representatives would be, among other things, responsible for following up the referral request process, providing the Authorities with the information sharing agreement, and escalating any issues encountered in either of the jurisdictions.


1 NYDFS, DFS and France ACPR Sign MOU to Boost International Fintech Cooperation, June 3, 2020, available at https://www.dfs.ny.gov/reports_and_publications/press_releases/pr202006031. This MOU was signed on April 3, 2020 by the ACPR and on May 26, 2020 by the NYDFS.

2 ACPR, Singapore and France bolster FinTech ties with cooperation agreements, March 27, 2017, available at https://www.amf-france.org/en/news-publications/news-releases/amf-news-releases/singapore-and-france-bolster-fintech-ties-cooperation-agreements

3 ACPR, Fintech Collaboration between the Hong Kong Monetary Authority and the Autorité de Contrôle Prudentiel et de Résolution, July 5, 2019, available at https://acpr.banque-france.fr/sites/default/files/medias/documents/cp_acpr_hkma_en_05072019.pdf

4 ACPR, France and Korea agree to facilitate cross-border expansion for Fintech companies, October 23, 2018, available at https://acpr.banque-france.fr/sites/default/files/medias/documents/press_release_acpr_-_23102018.pdf

5 ACPR, Japan and France sign Cooperation Frameworks regarding Innovation in the Financial Sector, November 19, 2018, available at https://acpr.banque-france.fr/sites/default/files/medias/documents/cp_acpr_-_amf_-_fsa_19112018_veng.pdf

6 ACPR, Cooperation Agreement between the Financial Supervision Commission of Taiwan and the Autorité de Contrôle Prudentiel et de Résolution, July 12, 2019, available at https://acpr.banque-france.fr/sites/default/files/medias/documents/20190712_acpr_fsc_en.pdf

7 NYDSF, Israel Securities Authority, Bank of Israel, Israel Capital Markets Insurance and Savings Authority, Memorandum of Understanding on FinTech Cooperation, June 2019, available at https://www.boi.org.il/he/BankingSupervision/MemorandumOfUnderstanding/Documents/Israel_NY_FinTech_MOU.pdf

8 NYDFS and ACPR, Memorandum of Understanding on FinTech Cooperation, available at https://www.dfs.ny.gov/system/files/documents/2020/06/mou_20200526_acpr_fintech.pdf

9 Ibid. Under Article 1.d of the MOU ““Financial Innovator” means any entity, which provides or intends to provide Innovative Financial Services in either of the Authorities’ jurisdictions.” “Innovative Financial Services” is defined as any services that are provided by means of FinTech.

10 Ibid.

11 Ibid.

12 Ibid.

13 Ibid.

14 Ibid. Under Article 1.c of the MOU “Confidential Information” means any non-public information obtained by an Authority pursuant to this Memorandum of Understanding.

15 Ibid.

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