Treasury has set out its plans for a temporary transitional tool for the UK regulators to use that will enable them to phase in the requirements for UK firms that will change under the raft of onshoring legislation consequent on Brexit.
The EU Withdrawal Act provides the enabling powers for Treasury to make the various instruments which can address any Brexit scenario, including a no-deal one. Key among these are the Temporary Permissions and Temporary Recognition Regimes.
Treasury and the UK regulators have already said that, in the event of a no-deal Brexit with no agreed transitional period, they do not expect firms that fall within the UK regulatory remit to have to prepare now to implement changes from March 2019 and that they want the UK regime to give firms the flexibility they need. As a result, Treasury now plans to give temporary power to BoE, PRA and FCA to be able to waive or modify regulatory obligations that change as a result of onshoring legislation. The powers would be available for 2 years from exit and the regulators could use them to grant relief to specific firms, classes of firms or all firms affected by a particular onshoring change.