Abide Financial sponsored Lena Komileva, Managing Director and Chief Economist, G+ Economics to examine the impact of Brexit on UK investment firms and financial regulation.
The UK’s financial industry is the economy’s most productive sector, its biggest exporter and highest tax payer. As such, the principle of EU “passporting”, allowing UK-based firms to operate in EU markets and attract overseas investment will remain critical for the economy’s health post-Brexit. Given the global nature of financial markets and London’s status as a global financial centre, UK financial regulation will continue to rely on cross-border recognition after Brexit, both within the EU and internationally. The efficient functioning of both the UK’s and the EU’s financial market infrastructure will require existing EU and UK regulation continuity and seamless implementation. Notwithstanding the outcome of future UK bilateral negotiations with EU member states, UK firms would indeed need to continue to comply with EU regulatory transaction reporting requirements (MiFID II, EMIR rewrite and SFTR) in order to continue cross-border trading with counterparties in the rest of the EU. Thus, reporting requirements are to remain in force and will require implementation in a post-Brexit, EU-equivalent, legal regime for UK financial services.
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