On July 12, the European Securities and Markets Authority (ESMA) released a public statement concerning the timely submission of requests for authorization regarding the United Kingdom withdrawing from the European Union (Brexit).
The public statement highlights the absence of any assurance that a transition period will be agreed prior to March 29, 2019 (Exit Day); therefore, firms need to consider the so-called “hard Brexit” scenario. If a hard Brexit occurs, firms will need to have a fully authorized legal entity located in one of the remaining EU member states (EU27) on Exit Day to continue providing services in the EU27.
Although, according to the public statement, the number of authorization requests to EU27 authorities has increased already, ESMA urges others seeking to relocate to the EU27 to submit their applications as soon as possible. Some EU27 regulators have confirmed that they cannot guarantee authorization by Exit Day for applications received after July 2018.
ESMA previously published opinions to support supervisory convergence post-Brexit (see the July 14, 2017 edition of Corporate & Financial Weekly Digest).
ESMA’s public statement is available here.