FCA published a policy statement (PS19/5) that sets out its responses to the feedback received on proposed changes to the FCA Handbook and Binding Technical Standards (CP18/28 and CP18/36), temporary permissions regime for inbound firms and funds (CP18/29), Brexit and contractual continuity (CP19/2), and regulatory fees and levies (CP18/34). Additionally, FCA has issued transitional directions and prudential transitional direction with respect to its approach to use the temporary transitional power.
FCA had received 92 responses to the consultation papers—CP18/28, CP18/29, CP18/36, and CP19/2. Annex 1 to PS19/5 contains the list of respondents who did not ask for their responses to be kept confidential. FCA has published the handbook and Binding Technical Standards in the near-final form so that stakeholders are clear on the changes expected to be made to the regulatory framework. These Binding Technical Standards impact the stakeholders under the varied EU legislation, including the Credit Rating Agency Regulation, Capital Requirements Directive and Regulation, Packaged Retail and Insurance-based Investment Products Regulation, Markets in Financial Instruments Directive and Regulation, and Insurance Distribution Directive, among others. Based on the timetable of the Parliament, FCA expects its Board to make the instruments final on March 28, 2019 if a withdrawal agreement has not been ratified by UK and EU.
HM Treasury has laid draft regulations in the Parliament (Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019), which grant FCA the powers to make transitional directions to mitigate any disruption caused by EU exit-related changes to firms’ obligations. These directions give regulated persons time to adapt to the Brexit-related changes to the UK financial services regulation. Continuity is generally achieved by applying a standstill; therefore, firms may continue to comply with the pre-exit version of an obligation. In addition, the temporary permission firms are allowed substituted compliance for home-state obligations. This power would only be used if UK leaves EU without an implementation period. The directions have been prepared on the assumption that the EU exit statutory instruments referred to in them will be in force by the exit day.
Keywords: Europe, EU, UK, Banking, Insurance, Securities, Brexit, FCA Handbook, Transitional Direction, PS19/5, CRA, FCA
Previous ArticleIMF Publishes Reports on 2018 Article IV Consultation with Malaysia
HKMA announced the publication of a report on fintech adoption and innovation in the banking industry in Hong Kong.
BIS published a working paper that examines the drivers of cyber risk, especially in context of the cloud services.
ECB launched consultation on a guide specifying how the Banking Supervision expects banks to consider climate-related and environmental risks in their governance and risk management frameworks and when formulating and implementing their business strategy.
ECB published an opinion (CON/2020/16) on amendments to the prudential framework in EU in response to the COVID-19 pandemic.
EBA published a report that examines the interlinkages between recovery and resolution planning under the Bank Recovery and Resolution Directive (BRRD).
SRB published the final Minimum Requirements for Own Funds and Eligible Liabilities (MREL) policy under the Banking Package.
EIOPA published its risk dashboard based on Solvency II data from the fourth quarter of 2019.
MNB published a statement on loan payments post the announced moratorium, in addition to a set of new questions and answers (Q&A) on supervisory measures and requirements announced amid COVID-19 pandemic.
EBA updated the Single Rulebook question and answer (Q&A) tool for banks.
US Agencies (FDIC, FED, and OCC) published an interim final rule that temporarily revises the supplementary leverage ratio calculation for depository institutions.