4 August 2019
Brexit Update: July
Includes the Government of Jersey’s Brexit Report, the Financial Conduct Authority’s infographic on the the UK’s withdrawal from the EU, mandatory notifications to the Luxembourg regulator for firms and their managers established in the UK, and information on UK statutory instruments.
States of Jersey Brexit Report: July 2019 Update
On 16 July 2019, the Minister for External Relations presented an updated report to the States in relation to Brexit. The report aims to update States Members and the Public on the ongoing work that the Government of Jersey is doing to prepare Government, residents and businesses for the UK’s exit from the EU, and to ensure the Island is ‘negotiation ready’ for the Phase 2 Future Partnership negotiations.
FCA infographic on the UK’s withdrawal from the EU
EU Exit: FCA extension to use of temporary transitional power
On 25 July 2019, the FCA announced that it will extend the proposed duration of the directions issued under the temporary transitional power to the 31 December 2020. This is to reflect the extension of Article 50. Other than the additional time the FCA’s approach remains unchanged. The FCA will publish further information before exit day on how firms should comply with post-exit rules. The extension is aligned with the end date intended by the Bank of England and the PRA.
Mandatory notifications to the Luxembourg regulator for firms, UCIs and their managers established in the UK
On 16 July 2019, the Luxembourg regulator (“CSSF”) issued two reminders addressed respectively to all firms currently authorised under CRD, MiFID II, PSD 2 or EMD in the United Kingdom and to UCIs and/or their managers, also established in the UK, that are currently authorised entities under Directive 2009/65/EC (“UCITS Directive”) and/or Directive 2011/61/EU, (“AIFM Directive”). In the event of a so-called “Hard Brexit”, these firms and entities will be considered as “third-country entities” meaning they will lose the benefit from passporting rights and therefore be exposed to sanctions if they pursue regulated activities in Luxembourg without a proper authorisation. To address this issue, the Luxembourg legislator and the CSSF have decided to set a transitional period of 12-months following the date of a hard Brexit. To benefit from this period, all firms and entities that intend to continue their activities in Luxembourg are required to notify the CSSF via the notification portal to be opened on the CSSF website in the coming weeks.
ECB updates FAQs on relocating to the euro area in the context of Brexit
On 5 July 2019, the European Central Bank (ECB) updated its FAQs on the procedures for the relocation of banks to the euro area in the context of Brexit.
ISDA Brexit FAQs
On 18 July 2019, the International Swaps and Derivatives Association (ISDA) has published version 7 of its Brexit FAQs which sets out the possible UK position post-Brexit, updated to the position as at 30 June 2019.
EU Exit: UK Statutory Instruments
On 25 July 2019, the draft Over the Counter Derivatives, Central Counterparties and Trade Repositories (Amendment, etc., and Transitional Provision) (EU Exit) (No. 2) Regulations 2019 (with draft explanatory memorandum) was published, which remedies certain deficiencies in legislation arising as a result of the UK’s exit from the EU, has been published.
On 16 July 2019, the Financial Services (Miscellaneous) (Amendment) (EU Exit) (No.3) Regulations 2019 (with explanatory memorandum) which remedies certain deficiencies in retained EU law and UK domestic legislation arising as a result of the UK’s withdrawal from the EU, has been made.