Enable’s IFA’s of Bishops Stortford know that the shape of regulation that will apply to UK financial asset managers after Brexit will depend on the nature of the UK’s relationship with the EU. The key issue will be the access to EU markets and the continued ability to distribute products to European investors. The economic model to be agreed is still not completely clear and short of the European Economic Area (EEA) Agreement (which would require retaining single market access), the model will have to be different.
According to global law firm Norton Rose Fulbright it could become, “some sort of bespoke arrangement for the UK accessing the single market, whether through a series of sector-specific treaties (the so-called “Swiss model”), a more extensive free trade agreement (the so-called “Canadian model”) or some sort of special affiliate status negotiated for the UK adapted from the current EEA arrangements. But if the UK is treated as a third country under EU financial services legislation and if UK investment firms wanted to continue to provide investment services or products to clients in the EU, UK rules will need to be deemed equivalent by the European Commission.”
If the UK will not agree to the EEA Agreement or be able to negotiate an arrangement with equivalent access, the UK will have to become a “third country” for the purposes of the Alternative Investment Fund Managers Directive 2011/61/EU (or “AIFMD” for short). An EU law on the financial regulation of hedge funds, private equity, real estate funds, and other. As such, UK based AIFMs will lose their right to manage funds based in other EEA domiciles and their right to market UK domiciled AIFs to investors in other EEA signatory states using the AIFMD marketing passport. But what is clear is that the financial world will not stop turning. If you want to consider the impact of Brexit on your wealth management Enables IFAs are here to help.
Issued by: Enable Independent Financial Life Planners • 25c North Street, Bishops Stortford, Herts CM23 2LD • Telephone: 01279 755950 – Fax: 01279 657339 Enable Independent Financial Life Planners is a trading style of Enable Independent Limited is authorised and regulated by the Financial Conduct Authority. It is important always to seek independent financial advice before making any decision regarding your finances. If you would like any assistance, please contact us. NOTHING CONTAINED IN THE ARTICLES SHOULD BE CONSIDERED AS GIVING INDIVIDUAL FINANCIAL ADVICE