ESMA Urges Firms to Continue Preparing for Brexit Transition Period End

The European Securities and Markets Authority (ESMA), told financial market participants in a statement today to finalise preparations and implement suitable contingency plans in advance of the end of the UK’s transition period on 31 December 2020.

The regulator also confirmed that previously agreed Memoranda of Understandings (MoUs) on cooperation and information Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term concluded with the UK’s Financial Conduct Authority (FCA) remain valid and will come into effect at the end of the transition period.

On 1 January 2021, once the UK’s transition period ends, firms whose activity might be impacted should have fully implemented their preparatory measures to mitigate any risks stemming from the end of the transition period, according to ESMA. All entities should also have provided appropriate information to their clients on any resulting consequences, the regulator added.

ESMA noted that previously published Brexit Brexit Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis Brexit stands for British Exit, or in reference to the United Kingdom’s decision to formally leave the European Union (EU) as declared in a June 23, 2016 referendum. In a more immediate sense, a tight vote and unexpected result helped drive British pound (GBP) to lows that had not been seen in decades.The day following the referendum, former Prime Minister David Cameron resigned from office where he was replaced by Theresa May, who later resigned from office on June 7th, 2019. Active Prime Minis Read this Term statements, in particular, ESMA’s general opinion to support supervisory convergence in the context of the UK withdrawing from the EU issued on 31 May 2017 and sector-specific opinions issued on 13 July 2017, remain relevant and should continue to be followed.

“ESMA will continue to review its Brexit-related statements, in particular in relation to operational issues, and will further communicate in due course,” the regulator stated.

Preparing for a no-deal Brexit

On 1 February 2019, ESMA and EU national securities regulators announced the agreement of MoUs with the UK’s FCA to cover cooperation and exchange of information in the event the UK left the EU without a withdrawal agreement. At midnight (CET) on 31 January 2020, as the Withdrawal Agreement took effect and the UK entered into a transition period. As EU law continues to apply in and to the UK, these MoUs were not required to take effect.

ESMA, EU national securities regulators, and the FCA confirm that these MoUs, agreed in 2019, remain relevant and appropriate to ensure continued good cooperation and exchange of information and will come into effect at the end of the transition period, which is set to expire on 31 December 2020, according to ESMA’s statement.