Britain’s adoption and implementation of wide-ranging financial regulations must be reviewed and clarified as soon as possible after Brexit day, commentators have stated.
Speaking ahead of January 31, the day after which the UK will no longer be represented in the European Parliament, Steven Cameron, pensions director at Aegon, said it was important to decide which rules should be amended, and which should stay in place.
Mr Cameron’s said while chancellor Sajid Javid’s announcement the UK would not remain aligned to European Union rules after Brexit was “not a surprise”, the “critical question” was in which areas the UK government would seek to diverge.
He explained: “Within financial services, there will be a mix of views. For firms offering and advising on pensions and Isas, which are for UK customers, we see some merit in reviewing EU derived disclosure rules and the Treasury definition of advice, which was adopted from Mifid, to make sure these are delivering best outcomes for UK customers.”
EU law will continue to apply throughout 2020, and passporting will continue as now during that time. Consumers’ rights and protections will also remain unchanged, but negotiations on trading and mutual equivalence agreements and laws will start later this year.
Nausicaa Delfas, executive director of international for the FCA, said: “Our future trading relationship with the EU is still to be negotiated and agreed, and we are just at the beginning.
“We stand ready to provide technical advice, in line with our objectives to Government on any Free Trade agreements it negotiates with the EU.
"Commentators sometimes suggest that we will have either “equivalence” with EU rules, or diverge. The reality is not so binary. For countries independently assessing each other for equivalence, they will generally not start with the same set of rules.”
Speaking at law firm BCLP London, Ms Delfas added: "Firms still need to ensure they are prepared for a range of scenarios that may happen at the end of 2020 – and this includes the scenario in which the activities they conduct might not be covered by agreements reached between the UK and the EU."
Meanwhile, prime minister Boris Johnson has also pledged to boost UK business with new funding and regulations.
Luke Davis, chief executive of IW Capital, said: “Research we carried out among 2,000 investors found 46 per cent say that, if handled correctly, Brexit could be the best thing to happen to the UK economy.
“We have seen more demand than ever before to invest in growing SMEs, as well as more entrepreneurs looking for investment. Supporting and allowing this sector to grow at the pace at which it could will undoubtedly have a marked effect on the economy as a whole.”
Jenny Tooth, chief executive of the UK Business Angel Association, said: “We are still holding our breath to see what the relationship is like with the EU. These pledges are certainly welcome and beneficial to Britain's regions, but it is future trade deals with the EU that we are really waiting on.”