On 21 December 2018, HM Treasury published a draft version of the Financial Services and Markets Act 2000 (Amendment) (EU Exit) Regulations 2019, together with updated explanatory information.
The Regulations will make amendments to UK primary and secondary legislation related to the framework for financial services regulation in the UK to ensure that it continues to operate effectively in a UK context once the UK leaves the EU, in any scenario.
The explanatory information explains most of the provisions in the Financial Services and Markets Act 2000 (FSMA) and related domestic legislation that will become deficient as a result of the UK’s withdrawal from the EU and gives details of the fixes that will be necessary to address them. These relate to issues which include:
- definitions for regulated activities and entities used in FSMA, the Financial Services and Markets Act 2000 (Regulated Activities) Order 2001 and the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005;
- permission to carry on regulated activities;
- performance of regulated activities;
- control of business transfers;
- control over authorised persons;
- provision of financial services by members of the professions;
- supervision and enforcement by the Financial Conduct Authority and the Prudential Regulation Authority.
HM Treasury intends to lay the Regulations before Parliament before exit day. The Regulations will enter into force on exit day, with the exception of certain provisions specified in regulation 1(2) which will come into force on the day after the day on which the Regulations are made.