On 1 February, ESMA announced that it had agreed with EU Regulators and the FCA Memoranda of Understanding (MoUs) to protect the asset management industry in the event of a no-deal Brexit. The MoUs include a multilateral MoU between EU/EEA Regulators and the FCA covering 'supervisory cooperation, enforcement and information exchange between individual regulators and the FCA, and will allow them to share information relating to, amongst others, market surveillance, investment services and asset management activities. This, in turn, will allow certain activities, such as fund manager outsourcing and delegation, to continue to be carried out by UK based entities on behalf of counterparties based in the EEA.'

ESMA’s announcement will be welcome news to the UK asset management industry and helps address industry fears over the loss of EU fund managers’ ability to delegate investment management functions to UK managers in the event of a no-deal Brexit.