Any financial services firm with clients in Europe please be aware that 2021 is a year of change, but despite Boris Johnson\u2019s Brexit discussions with the President of the European Commission, Ursula Von Der Leyen, over a three course dinner and his \u201coven ready\u201d Brexit deal, it seems as though the financial services industry was not part of the ingredients.<\/p>\n\n\n\n
In summary, the United Kingdom (\u201cUK\u201d) left the European Union (\u201cEU\u201d) on 31 January 2020 when the one year Brexit transition period expired. Until that date, EU law had continued to apply within the UK, but now the end of the transition period has passed, the UK in general is now considered as a \u2018third country\u2019 under EU rules.<\/p>\n\n\n\n
The treaty agreement (the \u201cAgreement\u201d) between the UK and the EU<\/a> which governed the ongoing relationship during the U.K.\u2019s exit from the EU, was agreed on 24 December 2020 and was published by the U.K. government on 26 December 2020. However, quite surprisingly given that Financial Services is one of the U.K.\u2019s most significant services industries, this was covered only briefly in the Agreement.<\/p>\n\n\n\n The FCA has not instructed firms to communicate with clients about Brexit and the treaty agreement specifically. However, the FCA has remined firms of the requirement to keep their clients informed about developments which will affect them. Therefore, FCA authorised firms should have been communicating with clients in respect of any aspects of Brexit which will affect them, as applicable on a client by client basis.<\/p>\n\n\n\n Firms should currently be reviewing and updating relevant compliance documents to ensure all references to the UK leaving the EU have been inserted into applicable manuals, policies and procedures.<\/p>\n\n\n\n The Agreement does not contain any special privileges for either party as a result of the similarity between UK and EU financial regulations at the point of Brexit. The treaty includes:<\/p>\n\n\n\n The above is notwithstanding unilateral initiatives from the UK that provide short-term continuity of access to such institutions, such as the FCA\u2019s Temporary Permissions Regime (\u201cTPA\u201d).<\/p>\n\n\n\n Rishi Sunak, the UK\u2019s Chancellor of the Exchequer, cited an aim to set up agreements on the basis of \u201cequivalence\u201d and establishment of a Memorandum of Understanding (\u201cMOU\u201d) between the UK and the EU in the coming months; measures aimed to facilitate access to the EU marketplace for UK financial institutions. \u201cEquivalence\u201d, in this context, refers to an agreement between the two jurisdictions with different regulatory frameworks, but where the frameworks are deemed substantially similar and robust, thereby enabling a financial institution in one jurisdiction to provide services into another jurisdiction via the \u201cequivalence\u201d agreement.<\/p>\n\n\n\n Treasury minister John Glen is set to lead post-Brexit talks with the EU early in January 2021 in order to establish a MOU that will guide future regulatory cooperation on financial services. The aim is to reach an agreement by March 2021 for \u201cequivalence\u201d allowing the finance industry to trade across UK \/ EU border.<\/p>\n\n\n\n Any financial services firm with clients in Europe please be aware that 2021 is a year of change, but despite Boris Johnson\u2019s Brexit discussions with the President of the European Commission, Ursula Von Der Leyen, over a three course dinner and his \u201coven ready\u201d Brexit deal, it seems as though the financial services industry was… Read more »<\/a><\/p>\n","protected":false},"author":4,"featured_media":773,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[1],"tags":[],"class_list":["post-830","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-uk"],"acf":[],"_links":{"self":[{"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/posts\/830","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/users\/4"}],"replies":[{"embeddable":true,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/comments?post=830"}],"version-history":[{"count":5,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/posts\/830\/revisions"}],"predecessor-version":[{"id":835,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/posts\/830\/revisions\/835"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/media\/773"}],"wp:attachment":[{"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/media?parent=830"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/categories?post=830"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.effectacompliance.com\/wp-json\/wp\/v2\/tags?post=830"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}What should asset managers be thinking about now that the UK has left the EU?<\/strong><\/h3>\n\n\n\n
Notifications to clients:<\/h5>\n\n\n\n
Compliance Documentation reviews:<\/h5>\n\n\n\n
What Is Included for Financial Services?<\/strong><\/h3>\n\n\n\n
What has not been included for Financial Services?<\/strong><\/strong><\/h3>\n\n\n\n
What are the next steps now the UK has left the EU?<\/strong><\/h3>\n\n\n\n
How Effecta Can Help<\/h3>\n\n\n\n