Category Brexit

NCA and TI warn of Brexit ML risks

The NCA and Transparency International have warned of the risks Brexit presents of the UK being used as a vehicle for money launderers and corruption. Responding to the NCA’s identification of the risks, TI said: the UK should speed up plans to introduce a public register of the real owners of overseas companies that buy […]

Government responds on Brexit

The Government has published its response to the House of Lords EU Committee Report on financial regulation and supervision after Brexit. It offers assurances that: the UK will continue to lead global standards; the Government is already taking action under the EU Withdrawal Bill to incorporate the acquis. It is working on how to address […]

EU updates on withdrawal plans

The European Commission has updated its website with notices on plans for Brexit in several industry sectors including financial services. The latest news reports a request from the Commission and Treasury to the ECB and BoE to convene a technical working group on risk management in the transition period. There are also some terms of […]

Barnier speaks on Brexit

Michel Barnier has spoken to Eurofi. He described Brexit as a lose-lose situation, with no added value.  He said: there can be no frictionless trade outside the Customs Union and Single Market so businesses will be faced with barriers and checks that are not in place today and this will have an impact on value […]

FCA speaks on asset management

Andrew Bailey has given a regulatory perspective on asset management. His speech considered: market-wide risks: he looked at the growth in the asset management sector and particularly the increase in proportionate growth of the asset management sector over others. open-ended funds: he considered the risks of funds offering daily redemption in illiquid assets which also […]

EC VP speech highlights risks arising from Brexit

In a recent speech, Vice-President of the EC, Valdis Dombrovskis, warned of the consequences arising from the fact that the transition period agreed at a European level was part of the overall future withdrawal agreement.  Therefore, if finalisation of the withdrawal agreement was compromised due to issues such as the Irish border and governance of […]

Andrew Bailey of the FCA discusses open financial markets

The FCA has published a speech by its Chief Executive, Andrew Bailey, in which he spoke about open markets through the prism of Brexit, including the prospects and reasons for a transition period and what the steady-state future could look like. Bailey highlighted the paramount need for financial stability and argued that this would be […]

UK and US announce working group creation

HM Treasury and the US Treasury Department have announced the formation of a Financial Regulatory Working Group, to formalise engagement on bilateral regulatory cooperation. The group is scheduled to meet twice a year

ESAs report on key risks for H2 2017

The Joint Committee of the European Supervisory Authorities has published its report for the second half of 2017.  This report highlights the following potential sources of instability: repricing of risk premia uncertainties regarding the terms of Britain’s exit from the EU; cyber attacks; and climate change. The report urges firms and supervisory authorities to seek […]

FCA and PRA publish business plans

The FCA and the PRA have both published their business plans for 2018/2019. The FCA’s business plan shines a spotlight on consumer protection, including in relation to pension products and high-cost credit, as an area of concern for the forthcoming year, as well as ongoing programmes such as Brexit, and firms’ culture and governance (including […]

EU Exit Committee sets out key Brexit tests

The Commons Committee for Exiting the EU has published a report setting out the key tests it says any deal agreed by October must meet. From the financial services perspective, the report notes the critical importance of UK providers being able to continue to sell their products into EU markets as they currently do and […]

Government responds on financial regulation post Brexit

John Glen, Economic Secretary to the Treasury, has responded to the Lords EU Financial Affairs Sub-Committee’s January report on the future of financial regulation and supervision post-Brexit. The response, which was prepared before the most recent developments on the Brexit arrangements,  notes that the Government is alive to many of the issues the report raised and sets out […]

FCA SPEECH ON BREXIT: TRANSITION AND FINANCIAL REGULATION

The FCA has published a speech by Andrew Bailey, Chief Executive of the FCA, on Brexit, following the agreement reached between the UK and EU on a transition period. Key issues highlighted by Mr Bailey include: the importance of a transitional period for everyone involved in financial services on both sides; the need for continuing authorisation for […]

PRA and BoE’s approach to authorisation and supervision in preparation for Brexit

The Bank of England (BoE) has published a press release setting out its regulatory approach to preparations for Brexit, including its approach to the authorisation and supervision of international banks, insurers and central counterparties (CCP). The update follows the agreement between the UK and EU27 that there should be an implementation period until the end of 2020 as […]

ECB Annual Report on supervisory activities

The European Central Bank (ECB) has published its Annual Report on its supervisory activities for 2017. The Annual Report sets out the ECB’s key achievements for 2017. In addition, the ECB published a speech on the Annual Report given by Daniele Nouy, Chair of the ECB’s Supervisory Board, which includes focus areas on general developments in the […]

Government heralds Brexit transition progress

The Department for Exiting the EU has published a draft Withdrawal Agreement following the conclusion of a key set of negotiations.  David Davis and Michel Barnier both welcomed the progress.  Mr Davis heralded the agreement, which provides (among other things) that international agreements that arise as a result of the UK’s membership of the EU will […]

FPC updates financial stability outlook

In its latest meeting, the Financial Policy Committee focused on: the outlook for UK financial stability generally: it thought these were standard, excepting the Brexit risks, with risks from global vulnerability still being material. Risks from certain markets in the US and in China are elevated, but there seems to be some sign of increasing […]

FCA looks back on past 5 years

John Griffith-Jones has reflected on FCA’s first 5 years of operation, since it took over from the FSA.  He outlined: highlights – specifying FCA’s engagement with pension exit charges, general insurance renewals, interest-only mortgage work, FX and LIBOR issues and reform, MiFID 2 implementation, the Innovation Hub, market abuse enforcement, fixing PPI, the asset management […]

ABI writes to FCA on Brexit issues

The ABI has written to Andrew Bailey highlighting the issues its members are facing in meeting their duty to treat customers fairly, in the context of communications with customers over Brexit.  The letter welcomes the December communications on authorisation of EEA branches of insurers, and says members will assume this will happen, even though it […]

FCA surveys firms passporting into UK

As part of its preparation for Brexit, the Government announced in December 2017 that it would, if necessary, introduce legislation to enable a ‘temporary permission’ scheme for EEA firms and funds which, following Brexit, can no longer rely on their passporting rights to do business in the UK. The FCA has published a survey to […]

Chancellor speaks on financial services and Brexit

Philip Hammond gave his long-awaited speech on financial services and the future.  He referenced: that financial services is not just a London business and that two-thirds of financial services jobs in the UK are outside London Theresa May’s speech setting out what the UK wants from a partnership with the remaining EU his challenge to […]

Insurance Europe publishes position paper on the consequences of Brexit on existing contracts

Insurance Europe has published a position paper on the consequences of Brexit on existing insurance contracts. The paper discusses: existing (re)insurance contracts that may be affected by Brexit and how customers may be affected; what is currently permitted by passporting rights; when grandfathering is the only solution for existing contracts; and how to allow for […]

PM speaks on Brexit and Financial Services

Theresa May, speaking at Mansion House, set out her vision for the future economic partnership between the UK and the EU. In relation to financial services, she explained why existing models will not work. For example, the Norway model would keep the UK in the single market but would mean having to implement new EU […]

PRA responds to Treasury Committee’s inquiry into Solvency 2

PRA has published a report in response to the Treasury Committee’s inquiry into Solvency 2. The response is split into four parts: Part 1: Overview of the UK insurance industry and the rationale for the prudential regulation of insurers. Part 2: Solvency 2 and the UK insurance sector, including the development of Solvency 2. Part 3: […]

AFME publishes Brexit guidance on wholesale FS contracts

The Association for Financial Markets in Europe (AFME), has published a guide on the impact of Brexit on wholesale financial services contracts. The guide takes the form of FAQs and is intended to help clients of banks in understanding how cross-border relationships will be affected by the UK’s decision to leave the EU and, by […]

Insurance Europe publishes Brexit position papers

Insurance Europe has published two position papers relating to Brexit. The first paper discusses the need for a transitional arrangement, stating that such an arrangement is crucial for business continuity until legal clarity on the future UK-EU relationship is reached. Any transitional arrangement should ensure the UK remains covered by EU law and its supervisory framework […]

Commission updates Brexit pages

The European Commission has updated its website to provide information on how Brexit will affect banking and finance rules. Separate pages address: markets in financial instruments banking and payment services post-trade issues asset management credit rating agencies insurance and reinsurance and statutory audit Each page looks at the impact of withdrawal on authorisations, contracts and […]

FCA speech – The future of the city

On 5 February 2018, Andrew Bailey, FCA Chief Executive, delivered a speech, the Future of the City, which focuses on the transition to Brexit and the future of the UK regulatory regime. Key highlights include: the FCA is treating Brexit as a high priority and the FCA will do its utmost to ensure that it works […]

Chancellor writes to businesses on Brexit

Philip Hammond, together with David Davies and Greg Clarke, has written an open letter to businesses setting out what the UK wants to see in the post-Brexit implementation period. The letter says the Government is clear that the UK and EU access to each other’s markets must continue on the current terms during the period […]

Responses to the Treasury Committee’s report on Solvency II

The House of Commons Treasury Committee has published HM Treasury’s response and the PRA’s interim response to its report on the Solvency II Directive and its impact on the UK insurance industry. HM Treasury responded to the recommendations set out in the report relating to the PRA’s competitive objective and Brexit. In its interim response, the […]

PM meets FIs to talk Brexit

Theresa May has chaired a meeting of senior executives from a number of financial institutions to discuss the opportunities and challenges Brexit presents. She noted the UK’s aim of agreeing an implementation period by the end of March, while Philip Hammond said the Government is prioritising the needs of consumers and tax payers.  For their […]

FMLC publishes WTO Brexit views

FMLC has published a paper exploring the basis of UK trade with the EU following Brexit, and the interplay this will have with World Trade Organization (WTO) principles. As many commentators have noted, the basis of UK-EU trade could take the form of the UK’s continued EEA membership, a transitional arrangement, a new bespoke treaty, […]

Treasury, FCA and EIOPA issue statements regarding continuity of activities and services after Brexit

Along with the PRA’s publication of consultation papers on its intended approach to supervision of third country firms, the Treasury, FCA and ESMA have recently issued statements providing an update on provision to enable firms across Europe to continue to do business after Brexit. The Treasury has announced that if necessary (ie depending on the […]

PRA publishes consultation papers on approach to supervision of third country firms after Brexit

The PRA has issued two consultation papers on its approach to branch authorisation and supervision, addressed to international banks and to international insurers.  Both consultations close on 27 February 2018. The Bank of England has also published letters from Sam Woods, Deputy Governor for Prudential Regulation regarding PRA regulated firms’ planning assumptions, and from Sir […]

Treasury committee calls for urgent agreement on Brexit transition

The Treasury Committee has published a report which supports a time-limited “standstill” transition arrangement after the Brexit Article 50 negotiations are finished. It thinks it should be simple to negotiate these, to provide certainty as soon as possible and maximise the time available for longer-term discussions. The report also notes that, for the financial services […]

Lloyd’s reacts to Brexit developments

Reacting to the news that the UK and EU are planning to move to the next phase of Brexit talks, Lloyds has released a press release stating that it is pleased that the Brexit talks can now enter the second phase focusing on trade and that an agreement has been reached with regards to the […]

Treasury sets out long term approach to asset management

Treasury has revealed its “Investment Management Strategy II“, which sets out the Government’s priorities to ensure the UK remains a globally competitive sector for asset management. The approach focuses on six principles: establishing Centres of Excellence to strengthen the talent pipeline continuing to develop Fintech solutions such as blockchain enabled digital funds working to attract international […]

CMA consults on its 2018/19 annual plan

The Competition and Markets Authority (CMA) is consulting on its draft annual plan, which sets out its plans and priorities over the next year. Interested parties have the opportunity to provide views and comments on the proposed priorities until 14 January 2018. Over the next year, the CMA is proposing to take a particular interest […]

LMG proposal addresses issues of access, control and continuity of service in post-Brexit insurance sector

In light of Brexit-related concerns over continuity of service in the insurance sector, the London Market Group (LMG) has issued a proposal to the UK government detailing a mechanism whereby both the UK and EU are permitted mutual market access and mutual recognition of respective prudential regimes following Brexit. The proposal centres on a free trade agreement […]

Financial Stability Report, November 2017

The Bank of England (BoE) has published its financial stability report, issue number 42.  The report sets out the Financial Policy Committee’s (FPC), a sub-committee of the BoE’s Court of Directors, views of the outlook for UK financial stability, including the assessment of the resilience of the UK financial system and the main risks to […]

Autumn Budget 2017: Key points for the financial services sector

Philip Hammond, Chancellor of the Exchequer, has delivered the Autumn Budget 2017. Key points for the financial services sector include: Asset management – the Government will publish a new long-term strategy to ensure that the UK asset management industry continues to thrive and deliver the best possible outcomes for investors and the UK economy. This will […]

UK based EU agencies agree relocation

The Council has decided on the new locations of various UK-based EU agencies.  In the financial services sector, the EBA will be relocating to Paris.

Barnier speaks on EU future and Brexit

Michel Barnier, speaking at the Brussels office of the Centre for European Reform, spoke on the EU “standing up for itself”. He said Brexit could be a turning point in what he called the European project. He noted the UK’s voiced strong support for the Single Market in 2012 and said that the stronger EU […]

David Davis’ speech on the financial services sector post Brexit

On 14 November 2017, David Davis, Secretary of State for Exiting the European Union, gave a speech on the post-Brexit relationship between the UK and the EU relating to the financial services sector. In his speech, Mr Davis focussed on the Government’s approach to its negotiations to leave the EU and what it is doing […]

Select committee calls for post-Brexit transactional deal

The Lords’ EU Financial Affairs Sub-Committee has written to the Chancellor calling for an urgent agreement on a post-Brexit “standstill” transition point for the financial services sector. Baroness Falkner said the industry has repeatedly warned it cannot continue to service cross-border clients after 2019 if a transition period is not agreed by the end of […]

Sanctions and Anti-Money Laundering Bill introduced in Parliament

The new Sanctions and Anti-Money Laundering Bill (the Bill) was introduced in Parliament on 18 October, following the announcement of the Bill in August. This Bill seeks to enable the UK to continue to comply with the current UN sanctions regime after Brexit, by covering matters currently deal with through the European Communities Act 1972 (which will be […]

Treasury launches inquiry into UK’s economic relationship with the EU

The Treasury Committee has launched a new inquiry into the UK’s economic relationship with the EU, which amongst other things will consider: Transitional arrangements; Preparedness for ‘no deal’; and The long-term economic relationship. The inquiry is now open, and is accepting written submissions. The first evidence session (to be held 25 October) will focus on the progress […]

ESMA speaks on financial markets

Steven Maijoor has spoken on the state of European financial markets. He spoke not only about Brexit, focussing on the need for a  strong supervisory culture, but also on the importance of building the CMU and improving understanding of trends, risks and vulnerabilities in the financial markets. He spoke about the continuing lack of trust […]

TheCityUK warns on dangers of transition delay

TheCityUK has called on the government to progress the Brexit transitional arrangements as quickly as possible, before firms have to implement their contingency plans because they cannot wait any longer. The paper stresses what is at stake for both the UK and the EU, and calls for an early agreement on transitional arrangements which should be […]

Chancellor’s repsonse to Treasury Committee’s letter on the effect of Brexit on insurance contracts

The Government has published a response to the Treasury Committee letter on Brexit and insurance contracts. The letter acknowledges the risk that the UK’s withdrawal could create legal uncertainties as to the status of existing cross-border insurance. The Government has been working with the insurance industry and others in the financial services sector to understand […]

EBA’s Opinion on the UK’s departure from the EU

On 12 October 2017, the European Banking Authority (EBA) published an Opinion on issues relating to the UK’s departure from the European Union (EU). The Opinion is focused on the period prior to the departure of the UK. The purpose of the Opinion is to provide guidance on supervisory expectations and to address regulatory and supervisory […]

EIOPA speaks on future disruption to the insurance industry

Dr. Manuela Zweimüller, Head of Policy Department at EIOPA, has delivered a speech on what will the future hold? The European insurance industry in times of major disruption. The speech highlights challenges in respect of InsurTech, Brexit and Regulatory stability. EIOPA considers that the insurance industry needs to reinvent itself in respect of InsurTech and […]

Square Mile judicial complex receives backing from City of London Corporation

In a bid to bolster the capital’s reputation for financial and legal services post-Brexit, the City of London Corporation (CLC) has announced its backing for the development of a new court complex on Fleet Street to replace all of the City’s current court services except the Old Bailey. The space will provide for 18 courtrooms and focus […]

ESMA highlights Brexit and MiFID 2 issues

Steven Maijoor spoke to ECON as part of the annual hearing of the chairs of the ESAs. He focussed on 3 main priorities for ESMA: MiFID 2 implementation and ESMA’s efforts to ensure regulatory convergence. He highlighted the Q&As and Opinions ESMA has issued with this in mind. He expressed some optimism over ESMA’s readiness to […]

EBA announces 2018 work programme

The European Banking Authority (EBA) has today published its annual work programme in which it announced its strategic priorities for next year and beyond. EBA comments on the Commission’s legislative programme for the year, involving a review of the CRR and BRRD developments and the consequences of the BCBS’ revision of the trading book; the implementation […]

PRA comments on “Geofinance”

Sam Woods, speaking at Mansion House,  commented on what he predicts to be an increasingly prevailing dynamic in financial institutions and financial regulation. Geofinance is the impact of geography on how banks, insurers and regulators operate, and Woods remarks that it “is likely to be the defining challenge of the next few years.” Woods stated “stability begins at home” […]

EIOPA work programme for 2018

EIOPA has published its Single Programming Document for 2018, highlighting and specifying the activities and tasks for the coming year, within the framework of a multi-annual work programme 2017-2019. EIOPA comments that outcomes of the Brexit negotiations and of the review into the ESAs is still uncertain and has not factored them into its SPD. […]

Bank of England expects 130 licence applications before Brexit

Comments made by Sam Woods, Chief Executive Officer of the Prudential Regulation Authority (PRA) were reported in an article published by Reuters, in which he stated that the Bank of England expects at least 130 financial firms from across Europe to apply for licences to continue operating in the UK after Brexit. He also commented that […]

FPC updates on stability

FPC has reviewed developments since its last meeting on 21 June and assess the outlook for UK financial stability. Its conclusion was that ‘overall risks to UK financial stability from the domestic environment are broadly unchanged at a standard level’, though risks of greater vulnerabilities may loom on the horizon. The headline statements were as follows: internationally, market […]

ESAs report on risks and vulnerabilities in the EU financial system

On 21 September 2017, the Joint Committee of the European Supervisory Authorities, published its September 2017 report on risks and vulnerabilities in the EU financial system, identifying Brexit and FinTech as two of the main risks to the EU financial system. Brexit: The UK’s decision to withdraw from the EU and the uncertainties around the […]

Treasury Committee letter to Chancellor on effect of Brexit on insurance contracts

The Treasury Committee has published a letter written to the Chancellor of the Exchequer highlighting the problem with insurance contracts sold under passporting arrangements with a duration beyond 29 March 2019. The Chair of the Treasury Committee explains that without further action, insurers will lose the right to service these contracts and there may be insufficient time to […]

AFME calls for Brexit transition clarity

AFME has called for early clarity on the Brexit transition. It says that while it is critical that transition arrangements are agreed soon, it agrees with the European Commission that they must be clearly defined, limited in time and subject to effective enforcement mechanisms. It says there must be recognition that businesses will need more […]

FMLC writes to MoJ on Withdrawal Bill

FMLC was invited to comment on the EU (Withdrawal) Bill, and has now provided its views to the Ministry of Justice. It is concerned that the wording of the Bill will create confusion. The Bill essentially says that all EU measures that are effective in the UK immediately before exit day will be effect post-exit. […]

ECB: Brexit clock is ticking

Sabine Lautenschläger, Member of the Executive Board of the ECB and Vice-Chair of the Supervisory Board of the ECB, talks about developments in the preparatory work of banks and supervision in light of the UK leaving the European Union, Supervision Newsletter (Summer 2017) In summary, Lautenschläger said that: all affected banks should prepare themselves with […]

Treasury Committee and PRA exchange Brexit letters

Nicky Morgan, new Chair of the Treasury Committee, and Sam Woods of PRA have exchanged letters on Brexit planning. The PRA response explained PRA’s work in assessing the scenarios that might have the biggest impact on its objectives – such as a hard Brexit with no ongoing cross-border market access. PRA has received over 400 […]

LMA publishes EU contract continuity clause

The Lloyd’s Market Association has published a model clause as guidance for its Members. The clause is designed to enhance contract certainty on the occurrence of an event associated with membership of the European Union or economic or monetary union in the European Union, such as Brexit.

Bond Dickinson commercial insurance timeline

We have prepared a commercial insurance timeline which highlights key legislation, regulation, cases and other developments that impact on the industry. This timeline covers developments from March 2017 onwards.

PRA asks firms to provide Brexit contingency plans

Sam Woods, the PRA’s CEO, has published a letter seeking contingency plans from firms in light of the UK’s impending withdrawal from the EU. The letter is relevant to banks, insurers and designated investment firms undertaking cross-border activities between the UK and the rest of the EU. PRA expects firms to prepare and execute in […]