Brexit Asset Management Update

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

EU Exit: FCA directions extending TPR notification period

The FCA has published updated directions for firms intending to enter the temporary permissions regime (TPR), extending the time period during which notifications can be made until the end of 30 January 2020. These directions are directly relevant to:

• EEA alternative investment funds;
• EEA firms with passports and Treaty firms;
• EEA collective investment schemes;
• authorised payment institutions and EEA registered account information service providers; and
• e-money institutions.

EU Exit: Government letter on equivalence in financial services sector 

The Department for Leaving the European Union (DExEU) has published a letter from John Glen, Economic Secretary to the Treasury, responding to the House of Commons European Security Committee’s request for clarification on the Government’s plans for seeking equivalence in EU markets in financial services after Brexit.

In his letter, Mr Glen confirms that the Government did not seek any changes to the financial services text in the revised Political Declaration, and that the UK and EU have committed to start assessing equivalence with respect to each other under existing frameworks as soon as possible after Brexit, endeavouring to conclude these assessments by the end of June 2020.

EU Exit: PRA update to SMCR “deemed approval” guidance on timing

The PRA has updated its guidance on the Senior Managers and Certification Regime (SMCR) and the Temporary Permissions Regime (TPR) to confirm that firms that have not submitted full Senior Management Function applications prior to entry into the TPR should ensure that they submit relevant forms within six weeks from EU exit day to enable individuals to obtain a deemed approval by 12 weeks from exit day.

ECB speech on the European Banking Union

The European Central Bank (ECB) has published a speech by Andrea Enria, Chair of its Supervisory Board, setting out his thoughts on the past, present and future of the European banking union. Mr Enria discusses the current work of the ECB strengthening the capital position of euro area banks, the Single Supervisory Mechanism (SSM), and the banking sectors’ preparation for the future post-Brexit landscape. Mr Enria concludes with his view that the financial sectors of the UK and the EU will remain closely intertwined.

FMLC: Addendum to Brexit analysis on third country regimes in EU legislation

The Financial Markets Law Committee (FMLC) has published an addendum to its report, published in 2017, entitled ‘Issues of Legal Uncertainty Arising in the Context of the Withdrawal of the UK from the EU - the Provision and Application of Third Country Regimes in EU Legislation’ (2017 Report). The addendum sets out key updates to the 2017 Report which focused on issues of legal uncertainty specific to the application of EU legislation to UK-based financial services providers in the event that the UK withdraws from the EU without retaining access to the single market under any other legal provision.