Impact of Article 50 extension on the UK Temporary Permissions Regime

Following the agreement last week between the UK and the EU to extend Article 50 until 31 October 2019 11pm GMT (see our earlier post), the FCA has now confirmed that it will extend the notification window for incoming EEA firms and fund managers to enter the UK Temporary Permission Regime ("TPR") to the end of 30 May 2019. Fund managers that need to update their existing TPR notification as a result of the FCA's extension should also notify the FCA that this is the case by 16 May 2019.

If the Withdrawal Agreement can be ratified by 30 May 2019, then the TPR will not come into force, as an implementation period would allow incoming EEA firms and fund managers to continue carrying on their activities in (or into) the UK in the same way as they did pre-Brexit until the expiry of this period in December 2020.

However, if no agreement between the EU and UK can be reached by the end of May, it is not clear whether the FCA will extend the window for notification to align with the Article 50 deadline of 31 October 2019.

The FCA has stated that it will continue to keep the TPR notification window under review, but it is unlikely that further detail will be provided until there is greater political clarity on if, when and how the UK will leave the EU.

In light of this uncertainty, any incoming EEA firms and fund managers who intend to rely on the TPR should proceed on the assumption that they will need to submit their notifications before 30 May 2019.