The FCA has published a Dear CEO letter on cross border booking arrangements.
In its letter, the FCA acknowledges that, in order to deal with the UK’s withdrawal from the EU, firms have put in place contingency plans which when executed will impact current business models, legal entity strategies and booking arrangements.
The FCA appreciates the information that firms have already provided on their plans, and said that it is important for firms to continue to provide it with all necessary information. Firm should not take decisions without first speaking to the FCA.
The FCA said that the duties it has gained from the implementation of EU Directives and Regulations will continue, as will its responsibility for conduct of business in financial markets. It does not intend to restrict market access using regulatory or supervisory tools.
Firms that are planning to expand elsewhere in Europe need to ensure that the structures put in place enables the FCA to supervise the conduct of their UK business effectively and ensure that they continue to meet the FCA’s threshold conditions.
In addition, the FCA is aware that some European authorities have set out specific requirements regarding business models but it is open to a broad range of legal entity structures or booking models.