Jump to content

Sign in to follow this  
Luuk Jacobs

A bit of light at the end of the financial services tunnel .....

Recommended Posts

Luuk Jacobs
_104127773_cityoflondon_getty.jpg
WWW.BBC.CO.UK

The agreement may give UK firms continued access to the EU's finance market after Brexit, reports say.

 

The first glimpses of positive progress in the EU-UK Brexit negotiations. This would take a lot of uncertainty of the table for companies and people working in the industry ..... at least for the short term. I believe that the EU will continue with moving more financial services activities to Europe through changing regulation. The Irish and Luxembourg regulators have already introduced stricter requirements for fund management and it is unlikely to stop there.

  • Like 1

Share this post


Link to post
Share on other sites
Share this  
Luuk Jacobs

We all know the status of the overall Brexit agreement. At least for the investment management some positive news with the below "temporary equivalence determination for UK CCPs "

 

Yesterday, the European Securities Committee unanimously endorsed draft Implementing Acts providing for a 12-month temporary equivalence determination for UK CCPs and a 24-month temporary equivalence determination for UK CSDs in the event of a no deal Brexit.

Importantly, the Implementing Act for UK CCPs is not limited to the clearing obligation only. Instead, it covers any clearing services offered by a UK CCP to EU clearing members and venues. Likewise, the Implementing Act for UK CSDs is a wholesale equivalence decision under CSDR framework to allow for uninterrupted access post-Brexit on a time-limited basis.

We understand the European Commission will formally adopt the Implementing Acts in the 19 December College meeting next week – enabling them to become legally binding should the UK and the EU not conclude the Withdrawal Agreement before 29 March 2019. Members should note that the Implementing Acts only cover a possible no deal Brexit scenario, and are clear that they do not set a precedent for negotiations on equivalence during a transition period with the UK, should there be one.

We also note the Implementing Acts are limited to UK CCPs and CSDs only, and does not extend to cover UK trading venues in the event of a no deal Brexit. Under MiFID/MiFIR, the UK would need to be deemed equivalent by the EU, and UK trading venues would need to be recognised by ESMA, for certain trades to be executed through UK venues (such as those caught by the Share Trading Obligation or Derivatives Trading Obligation in the EU). Nothing, however, would prevent a UK entity trading through a UK venue or elsewhere outside the EU.

While the UK Government made clear it will recognise EU trading venues as part of its technical notices on no deal planning in August, we are yet to see the same on the EU side. We will continue to keep you updated on this issue, but in our view much of the impact of a no deal Brexit will depend on a broker’s ability to segment their trading into EU and non-EU trading, and prepare the necessary legal structures to underpin its operations. It is critical that the buy side drive their brokers to prepare for a no deal Brexit scenario.

Share this post


Link to post
Share on other sites
Share this  

Sign in to follow this  

Share this  
  • Related Content

    • Andy Milner
      By Andy Milner
      I thought it would be good to start a discussion thread on the actual impacts that the industry is feeling due to Brexit. As time goes on there is more and more quantitive analysis such as the below report from EY:
       
       
       
      https://www.ft.com/content/c9d2a2ca-1262-11e9-a581-4ff78404524e
       
      Keen to hear any positive news too..
    • Luuk Jacobs
      By Luuk Jacobs
      2018 is nearing its end. It has in many ways again been an exhausting year for the Investment Management industry. It started with the delivery of MiFID II, followed by other regulatory requirements like Gender Pay Gap Reporting and GDPR as well as preparing for the next round of regulation that will hit in 2019.
       
      I however think that 2019 is going to be the year of the B word.
       
      Likely this will be most associated with BREXIT – and the lack of plan B. I don’t want this blog to become another discussion of it as it is all in the hands of UK parliament as to where this all will go. If as a company you have not done your risk assessment in respect of this, and mitigated the risk already with changes to your business set up (how small or large this might be), time is, or has, run out by now and you can only hope for a low impact outcome.
       
      There are however other B words that I believe will put their mark on 2019.
       
      BLOCKCHAIN (or should we start calling it Distributed Ledger Technology). Much has been spoken about it but relatively little has been used in the investment management industry so far. The term at least has now become a collective understanding of the technology with targeted solutions becoming available although the blockchain technology offerings remain nascent and immature. Equally research from Forrester anticipates 90% of blockchain pilots won’t become complete products or services. Despite all these challenges blockchain will remain on the agenda of many Boards and Executives, as you can’t afford not to understand what it will change to and in your industry in general and the benefits it could bring to your own company.
       
      This brings us on to BITCOIN, one of the best-known uses of blockchain. 2018 was literally a year of highs and lows for Crypto Currencies in general. If you believe specialists in the field, 2019 will see the entry of Institutional money entering crypto currency. The Nasdaq will launch cryptocurrencies in 2019 and various other trading platforms are preparing their launch (Cyprus, Gibraltar).
      It is said that Bitcoin, as indicator for the crypto market, “is and remains in its long-term bull market. Bitcoin trades in its “transition band” whereas going forward, as Bitcoin is maturing as an investment, it will not exceed its bullish band” (investingHaven, October 2018).
       
      Bringing us to BOX and more specific sandbox; the technology and software testing environment that enables the isolated execution of software or programs for independent evaluation, monitoring or testing. This is becoming standard practice in business, and even the FCA, to test ideas to resolve the challenges that are being faced without directly making choices. It is bringing us all back to the days when we were at kindergarten playing in the sandbox, being creative, free spirited and thinking, leading to creating better together. 2019 will see sandbox being applied more broadly beyond technology.
       
      The last B word will be the BANK OF ENGLAND and its regulatory arm the PRA and FCA. Various regulation will need to be implemented in 2019, most notably and far reaching the Senior Manager Certification Regime (“SMCR”) and the Asset Management Market Study (“AMMS”). Both will not just be a challenge for the investment management industry to comply with but equally will change culture and governance on an unprecedented scale. 

       
    • Luuk Jacobs
      By Luuk Jacobs
      You indeed wonder what is in the end is more important ...
       
      although in the end it is all about you own felt pain is more important than someone else's pain
       

    • Luuk Jacobs
      By Luuk Jacobs
      A great article in the Spectator ....... a long but good read of the 9 lessons learnt or to be learnt !!
       
      The nine lessons of Brexit | Coffee House
      WEBCACHE.GOOGLEUSERCONTENT.COM The stakes could not be higher now. We face the biggest political crisis for at least a couple of generations. The risks are now both a democratic crisis and an economic one. We just cannot go on as…  
    • Andy Milner
      By Andy Milner
      Not a breakthrough as it only required a unilateral decision, but in case you missed it
       
       
       
      Treasury green-lights sale of new EU funds into UK regardless of Brexit outcome
      WWW.INVESTMENTWEEK.CO.UK UK investors' access to new EU funds secured in event of no-deal Brexit  
       
×

We use cookies to give you the best possible experience. If you continue, we’ll assume you are happy with this. For further information, see our Privacy Policy.