Brexit Asset Management Update

The post below summarises the latest Brexit developments related to asset management.

FCA Market Watch 61 and updated supervisory statement on MiFID transparency regime

The FCA has published the October issue of Market Watch which focuses on no-deal Brexit planning, in particular, MiFID transaction reporting and the operation of the MiFID transparency regime. The FCA reminds firms that industry testing for FCA Financial Instruments Transparency System (FITRS) will open on 10 October 2019.

The FCA has also updated its supervisory statement on the operation of the MiFID transparency regime if the UK leaves the EU on 31 October without a withdrawal agreement. The update takes into account the statement published by ESMA today (see below).

ESMA prepares for possible no-deal Brexit scenario

The European Securities and Markets Authority (ESMA) has updated its statements relating to the possible UK withdrawal from the European Union without a withdrawal agreement. Reference dates for Brexit in all measures and actions previously published by ESMA regarding the possibility of a no-deal Brexit scenario (see annex to the statement for a full list of statements and measures) should now be read as 31 October 2019.

The following measures have also been updated:

• Use of UK data in ESMA databases and performance of MiFID II calculations updating the communication issued on 5 February 2019;
• Impact of no-deal Brexit on the application of MiFID II/MiFIR and the Benchmark Regulation (BMR) - C(6) carve-out, ESMA opinions on third-country trading venues for the purpose of post-trade transparency and position limits, post-trade transparency for OTC transactions, BMR ESMA register of administrators and 3rd country benchmarks calculations updating the communication issued on 7 March 2019; and
• Operational plans related to ESMA databases and IT systems updating the communication issued on 19 March 2019.

Should the final timing and conditions of Brexit change, ESMA will adjust the approach for its IT applications and databases and will inform the public of the adjusted approach as soon as possible.

Government No-Deal Readiness Report

The Government has published a No-Deal Readiness Report relating to the outcome in which the UK leaves the EU without a deal. The report covers a number of sectors and topics, including financial services, and outlines the legislation and transitional measures the Government has introduced.

EBA statement

The European Banking Authority (EBA) has published a communication on the remaining issues related to the preparation by financial institutions for the departure of the UK from the EU. In its communication, the EBA reminds financial entities and competent authorities to continue their no-deal contingency planning to ensure that assets, appropriate staff and data are in place to support relevant authorisations and that customers are adequately informed.