Brexit news for financial services firms - from 25 May 2019 to 7 June 2019



HMT has published a note following a meeting of the Group on 23 May 2019. Topics under discussion included regulatory cooperation; the implications of Brexit on financial stability and cross-border financial regulation and financial innovation.


The text of speech given by Steven Maijoor on 4 June 2019 follows. Topics include: cross-border regulation and supervision; Brexit and the exchange of secondary markets data and equivalence.


Further to concerns raised by shareholders following its March 2019 guidance, ESMA's statement is intended to further mitigate potential adverse effects of the application of the trading obligation for shares (STO), within the constraints of a no-deal Brexit. ESMA has concluded that an approach to the STO based only on the ISIN of the share would be more likely to minimise any such risk of disruption in the interest of orderly markets, so the EU27 STO would not be applied to the 14 GB ISINs included in its previous guidance. ESMA assumes that all EU27 and EEA ISINs are within the scope of the EU27 STO. GB ISINs are outside the scope of the EU27 STO. ESMA set out concerns over the UK’s approach, noting that it has held regular discussions with the FCA to try to identify a way forward to avoid conflicting requirements, but at this stage it is unclear what would be the scope of the UK STO. FCA has published a response, stating that the risks are "not mitigated" by this new approach, suggesting that Article 23 MIFIR implies overlapping obligations for firms. In the absence of reciprocal equivalence, applying both UK and EU STOs in a way that maintains the status quo for a limited period of time after exit remains an alternative way of mitigating disruption whilst longer term solutions are found. FCA intends to engage with market participants and trading venues on the matter and will continue to consider its approach to the implementation of any STO needed in the case of a no-deal Brexit.

Other publications from the RegZone Brexit news feed

FCA: PS19/15: Securitisation (Amendment) (EU Exit) Regulations 2019 and Securitisation Regulations 2018 (near final and final rules)

Further to CP18/30, CP19/11 and PS18/25, this PS sets out final and near final rules in relation to the above-mentioned SIs. The Policy Statement can be found here.

HoC: EU preparations for a no-deal Brexit

This updated HoC Library briefing paper considers the preparations being made by the EU in the event of a no-deal Brexit, including with regard to the financial services sector.

HoC: Brexit - consumer rights

This HoC Library briefing paper provides an overview of some of the main issues concerning the impact of Brexit on the UK's consumer regime.

BoE: Speech by Dave Ramsden: Resilience: three lessons from the financial crisis

Text of this speech, given on 30 May 2019 follows, in which Dave Ramsden discusses lessons learned from the financial crisis and how these have affected BoE's approach to Brexit.

EBA: 2018 Annual Report

EBA's report sets out details of its work over the year (including work in relation to Brexit) and priorities for the coming year, including Basel II implementation; risks and opportunities arising from financial innovation and work on the new prudential regime for investment firms.

EC: Speech by Donald Tusk

Text of Donald Tusk's speech at the press conference of the informal dinner of EU heads of state or government on 28 May 2019 follows, in which he suggests that "Brexit has been a vaccine against anti-EU propaganda and fake news".

CMS RegZone publishes weekly updates (available via email, on-line and via Twitter) on Brexit developments for financial services firms. These provide analysis and commentary on significant developments during the week in question. A daily digest of Brexit news (without analysis or commentary) is also available by email here and online via the RZ news wizard here (both of these can be filtered using the Brexit topic). Links to publications are contained in each update; publications released before the updates commenced in April 2018 can be found in a bibliography here. CMS RegZone publication ‘Where we stand’ provides an overview of the current position in a single report; this is updated regularly to take account of the key developments from the weekly updates.