The European Securities and Markets Authority (“ESMA”) has recently issued a press release in relation to the Memoranda of Understanding (“MoUs”) agreed between ESMA and European securities regulators with the United Kingdom’s (“UK”) Financial Conduct Authority (“FCA”). These MoUs will only become effective in case the UK leaves the European Union (“EU”) without a withdrawal agreement, the no-deal Brexit scenario.
The MoUs are the following:
1. An MoU executed between ESMA and the FCA concerning the exchange of information in relation to the supervision of credit rating agencies (CRAs) and trade repositories (TRs). Through this MoU, ESMA seeks to continue fulfilling its mission regarding investor protection, orderly markets and financial stability in the EU; and
2. A multilateral MoU executed between securities regulators from the EU and the European Economic Area (EEA), including the Malta Financial Services Authority, dealing with supervisory co-operation, enforcement and exchange of information between individual regulators and the FCA. This MoU will allow the parties to share information relating to, inter alia, investment services, asset management activities and market surveillance. Hence certain activities such as outsourcing and delegation by a fund manager may continue to be carried out by UK based entities on behalf of counterparties based in the EEA.
Please feel free to contact us for any further information on ESMA and EU Securities Regulator’s agreement with the UK’s FCA in case of a no-deal Brexit scenario.
