Treasury readying Brexit contingency plans for finance industry

USPA NEWS - Treasury said on Thursday it would soon start putting contingency arrangements in place for financial services regulation if the country crashes out of the European Union without a deal.

The Treasury said that firms should still continue to plan for a transition phase of just under two years, which will come into force when Britain leaves the EU in March 2019 as long as the two sides agree a deal. However, it said it was also preparing in case that did not happen.
“The government will ensure a workable legal regime is in operation whatever the outcome of negotiations,“ the Treasury said in a document outlining its approach to financial services legislation throughout Brexit.

The plan for a no-deal scenario would see Britain convert EU laws and regulations into British law in a process dubbed “onshoring“.

The government hopes this would smooth the exit for financial services - a major industry accounting for 12 percent of Britain´s economic output.

The Treasury said it would also delegate powers to financial regulators to address any gaps in their rule books arising as a result, and would consult with all stakeholders to discuss its plans.

A number of statutory instruments will be created to establish the basis for the contingency arrangements, it continued. It plans to deliver soon the first, granting temporary permission for EU-licensed financial firms to operate in Britain if they can no longer “˜passport´ their licenses into the country, it said.

A further six instruments will be delivered throughout the autumn and into early 2019, the Treasury said, covering areas such as prudential regulation and capital markets.

Reporting by Emma Rumney; Editing by Richard Balmforth