ECB updates FAQs on relocating to the euro area in the context of Brexit
On 5 July, the ECB updated its FAQs on the procedures for the relocation of banks to the euro area in the context of Brexit. The new FAQs relate to: (i) the extension of Article 50 – the ECB states that a hard Brexit is still a very real possibility and could materialise on 1 November. Even if the Withdrawal Agreement is ratified, the end date of the transition period remains unchanged at 31 December 2020. Banks should be fully prepared are expected to focus their efforts on fully implementing their target operating models; (ii) the ECB decisions (published in March) authorising banks to establish or retain a branch in the UK once it becomes a third country – the ECB will assess the decisions on a case by case basis once the UK withdrawal date becomes clear and consider whether to withdraw or amend them; and (iii) the assessment of internal models – when the UK leaves the EU, there will be a limited period in which new significant euro area banks expanding or migrating from the UK might use internal models that have not yet been approved by the ECB. Such an agreement would be subject to strict conditions, including that internal models must have been approved by the UK supervisory authority and banks must have applied for the internal model approval in the euro area.
FCA Prospectus Regulation update
On 5 July, the FCA announced that it has decided to delay the implementation of changes to its Electronic Submission System (ESS) that enables it to collect data required by the new Prospectus Regulation which is due to come into effect from 21 July. The delay is due to the fact that ESMA has advised EU authorities that is does not require the full data set to be submitted at present, as pending system changes are unlikely to be completed before mid-2020. As such, the FCA is only making limited changes to the ESS portal for 21 July. Read more
FCA final rules on extension of SMCR
On 10 July, the FCA provided an update on its final rules to extend the SMCR to solo-regulated firms. The FCA has been working with HMT to prepare the commencement order required for the FCA to publish its final rules and the new regime will come into force on 9 December as planned. The FCA intends to publish its policy statement on the final rules following publication of the commencement order. The FCA has agreed with HMT a later commencement date for benchmark administrators which will be announced separately. Read more
FCA deadline extension in certain notifications under SMCR for solo-regulated firms
On 5 July, the FCA announced that it is extending the deadline for FCA solo-regulated firms to submit Form O (notification of change to firm classification) from 9 September to 24 November. The FCA states that if firms decide to opt into the enhanced regime, they must ensure that they are ready to meet all of the relevant requirements, including submitting a Form K (the conversion notification form), statements of responsibilities and a management responsibility map by 24 November.