FCA confirms final Brexit rules for firms

Mark Johnson's picture
by Mark Johnson

The Financial Conduct Authority has published its final instruments and guidance that will apply in the event the UK leaves the EU without a deal or an implementation period.

While Prime Minister Theresa May’s deal was voted down for a third time in Parliament today, the FCA has been working to deliver a transition that is as smooth as possible, if a nd when the UK does leave the Union. 

The package of documents published contains the majority of the final instruments and guidance, following the February publication of the FCA’s Policy Statement with near-final instruments.

Most of the instruments it have published today have been made under powers given to the FCA under the EU (Withdrawal) Act. The UK regulator said they have been approved by the Treasury, which is why it can now make them final.

Largely unchanged

The final instruments are largely unchanged from the near-final versions, which were published in February, the FCA said. 

The most significant change is that the instruments now commence on ‘exit day’, rather than 11pm on 29 March. This change reflects the decision made at the European Council on 21 March, as well as the changes made by the European Union (Withdrawal) Act 2018 (Exit Day) (Amendment) Regulations 2019.

The FCA has also published the majority of its final transitional directions and guidance for using the transitional power. The city watchdog has identified three additional areas where it has made amendments to the near-final directions published in February.

These changes relate to:

  • UK managers of EEA UCITS funds
  • the application of the Client Assets sourcebook (CASS) to activities carried on from an EEA branch, and
  • the distance marketing provisions.

“The documents published today are the final stages in our preparations in the event that the UK leaves the EU without an implementation period”, said Nausicaa Delfas, Executive Director of International at the Financial Conduct Authority 

“[T]hey ensure that firms have certainty of the financial regime they will be operating within, and so can plan accordingly to meet the needs of their customers.”

The FCA will publish information about technical standards under EU legislation on capital requirements, banking resolution and financial conglomerates later, once the PRA has published similar information.

The regulator also confirmed it has extended the notification window for firms who wish to enter the Temporary Permissions Regime or TPR until the end of 11 April 2019. 

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