Out-Law News | 02 Oct 2017 | 3:59 pm | 1 min. read
He told a conference that the FCA was also considering a temporary authorisation process for overseas financial institutions. According to the Financial Times (registration required) Bailey said this was one option which the FCA was considering to enable it to deal with the high number of authorisations expected after the UK's withdrawal from the UK took place.
Currently around 8,000 EU or European Economic Area (EEA) financial firms use regulatory 'passports' to sell their products throughout the EU, including in the UK. A further 5,000 UK firms use the passport to market products in the EEA.
Speaking at a London conference Bailey said firms needed to be able to continue their operations once the UK has withdrawn from the EU.
“If we are to promote open and innovative financial markets then, wherever firms operate cross-border, they should be able to continue doing so under the terms of the new relationship. This should be as seamless a process as possible, avoiding any interruption in the supply of services,” Bailey said.
“If firms lose the right to operate cross border, then they should be afforded sufficient time to restructure or take other action necessary to avoid a cliff edge, including enabling firms to meet outstanding contractual obligations in order to ensure continued consumer protection in the EU and UK, and certainty for financial markets,” Bailey said, speaking at the Official Monetary and Financial Institutions Forum last week.
He added that there should be a “strong preference” to maintain cross-border operations, in part to preserve financial stability and consumer confidence. But Bailey said open financial markets did not need to be confined within regional blocs.
Bailey's latest speech echoes previous comments made since the June 2016 vote to leave the EU. In January he said global standards should be applied to determine access to the financial markets.