FCA and Lloyds update on Brexit

FCA and Lloyd’s have both issued releases confirming how firms should act in the immediate aftermath of Brexit.

  • FCA confirmed that during the implementation period to 31 December EU law will continue to apply. So passporting continues to work, and consumer rights and protections derived from EU law will stay in place. Firms will continue to report as currently, including the reports due under EU Regulations. Firms wanting to use the TPR or the Temporary Marketing Permissions Regime should have notified FCA by the end of 30 January – but FCA is likely to reopen a notification window later in the year for additional notifications;
  • Lloyd’s has issued a Market Bulletin also noting the transition period and also highlighting the possibility for a further 2 year extension if the UK makes a request by the end of June (although the Government has said it will not do this). It notes that, after the end of the period, although passporting will stop, it should be possible to continue to provide reinsurance to cedants in the EEA on a cross-border basis provided local requirements are complied with.  Lloyd’s Brussels will operate for all other business to be written from EEA countries.  For intermediaries, EIOPA has aid that any entity carrying on distribution activities must be established and registered in the EU as a result of which many UK intermediaries have already established an EU-authorised intermediary with a UK branch. Lloyd’s will perform a Part VII transfer to ensure any non-life EEA insurance risk policies are written by Lloyd’s Brussels.

Emma Radmore