Welcome to the UKGI weekly regulation update service for Aviva ABC brokers

Link(s): https://ec.europa.eu/info/european-union-and-united-kingdom-forging-new-partnership/future-partnership/getting-ready-end-transition-period https://ec.europa.eu/info/publications/getting-ready-changes-communication-readiness-end-transition-period-between-european-union-and-united-kingdom_en

Context

The European Union Commission has issued communications as a reminder of the importance of contingency planning for the end of the Brexit Transitional Period on 31st December 2020. The document was originally published in July 2020.

Key points to note

• The guidance includes some relevant information for financial services firms, depending on which sector(s) of the market firms operate within.
• The communications include 11 pdf documents providing specific guidance on the following areas relevant to financial services firms:
  1. Asset management
  2. Banking and payment services
  3. Credit rating agencies
  4. Data protection
  5. E-commerce
  6. Emissions trading
  7. E-signatures
  8. Financial instruments (MiFID)
  9. Insurance/Re-insurance
  10. Occupational pension schemes
  11. Post trade financial services (trade reporting and settlement)
• There is no new information contained in these guidance documents however, they do set out the EU position on these matters in writing.
• The situation remains that from 1st January 2021, equivalence provisions agreed between ESMA, EBA, EIOPA and FCA will come into force to permit continuity in wholesale markets infrastructure, payment services and some aspects of reinsurance.
• The cross-border services and /or branch passports that permitted a financial services firm to do business on a cross-border basis without the need to be authorised by the regulator in each state where it did business, will end and will not be replaced.
• There will be no equivalence provision in any other area of financial services.
• The guidance has been re-issued in the context of the possibility that the UK and the EU cannot reach an outline agreement on a future trade deal by 31st December 2020.
• However, even if a trade deal is agreed by the deadline, nothing is likely to change for financial services as the trade talks are focused almost exclusively on trade in goods, produce and minerals (anything that can be boxed/packaged and shipped), financial services will not form part of any trade deal.