Last week, FISMA of the European Commission updated two documents relating to Brexit, targeted at firms in the EU:
- “Markets in Financial Instruments” (here) – Includes a reminder that at this juncture, UK venues will lose their recognition under EU law unless an “equivalence” determination is made by the EU beforehand. As a result, items such as the “REMIT carve out” will not apply (for EU firms) to trades executed on a UK based OTF. The document also reminds that EU firms will have restricted access to UK CCPs etc, and that the “passport” will be lost to UK regulated firms.
- “Post trade financial services” (here) – Includes a reminder that from the perspective of EU firms, non-hedge positions on UK Regulated Markets will contribute to the clearing threshold for Non Financial Counterparties under EMIR, unless an equivalence determination is made.
ESMA has also issued this statement, which advises market participants to continue preparations for the end of the transnational period, on 31 December 2020. It confirms that MoUs for certain types of market access will initially remain in force, as also reported in this article on the Reuters web site.
In the UK, the Department of Business, Energy and Industrial Strategy (BEIS) has made this announcement which updates on the preparations required for UK firms in advance of Brexit from an energy perspective. It reiterates that the UK will more or less operate a parallel REMIT and also repeats the preparations to be made in terms of obtaining an ACER code from an EU National Regulatory Authority. Mention is also made of ISEM, and in particular how it relates to Northern Ireland registered firms.