“EU GRANTS EQUIVALENCE TO FINANCIAL SERVICES ON A NO DEAL SCENARIO, BLASTS HOLE IN REMAINER CLAIMS THAT A NO DEAL WILL LEAD TO A CLIFF EDGE”
In response to the EU Commissions statement that upon a WTO arrangement with the UK the Commission “found that only a limited number of contingency measures is necessary to safeguard financial stability in the EU27”. The EU Commission also confirmed that UK Financial Services would have equivalence of financial rules with the EU:
Steven Woolfe, Brexiteer campaigner and Memeber of the European Parliament says
“For months Brexiteers have being saying that on a WTO deal with the EU financial services would not face a cliff edge and sensible minds would prevail. Today’s confirmation that the EU would grant equivalence to the UK and trade would continue as normal for a year after. This blows a huge whole in the project fear of Remainers like the Chancellor who have been attempting to scare the British public into staying in the EU. Their claims are nonsense and disgraceful.
Business is prepared and the markets will continue to function this is the reality of a WTO deal
Email message from the Economic and Monetary Affairs Committee to its Members
Dear ECON Members,
As part of its Brexit preparedness exercise – namely the “no-deal” Contingency Action Plan in specific sectors – the European Commission adopted on 19 December 2018 the following attached acts:
Commission Delegated Regulation (EU) amending Commission Delegated Regulation (EU) 2015/2205, Commission Delegated Regulation (EU) 2016/592 and Commission Delegated Regulation (EU) 2016/1178 supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council as regards the date at which the clearing obligation takes effect for certain types of contracts (C(2018) 9122) – under Article 5(2) EMIR.
Commission Delegated Regulation (EU) amending Delegated Regulation (EU) 2016/2251 supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council as regards the date until which counterparties may continue to apply their risk-management procedures for certain OTC derivative contracts not cleared by a CCP (C(2018) 9118) – under Article 11(15) EMIR.
Commission Delegated Regulation (EU) of 19 December 2018 amending Annex I to Regulation (EC) 184/2005 of the European Parliament and of the Council, as regards the geographical breakdown levels (C(2018) 8872) – Statistics (not yet provided by the Commission).
Commission Delegated Regulation (EU) amending Delegated Regulation (EU) 2015/2205, Delegated Regulation (EU) 2016/592 and Delegated Regulation (EU) 2016/1178 supplementing Regulation (EU) No 648/2012 of the European Parliament and of the Council with regard to regulatory technical standards on the clearing obligation to extend the dates of deferred application of the clearing obligation for certain OTC derivative contracts – under Article 5(2) EMIR (this RTS is not part of the Brexit package)
Commission Implementing Decision (EU) determining, for a limited period of time, that the regulatory framework applicable to central counterparties in the United Kingdom of Great Britain and Northern Ireland is equivalent, in accordance with Regulation (EU) No 648/2012 of the European Parliament and of the Council (C(2018) 9139) – EMIR.
Commission Implementing Decision (EU) determining, for a limited period of time, that the regulatory framework applicable to central securities depositories of the United Kingdom of Great Britain and Northern Ireland is equivalent in accordance with Regulation (EU) No 909/2014 of the European Parliament and of the Council (C(2018) 9138) – CSDR.
According to the Commission’s press release regarding the sector-specific regulation for financial services, after a thorough examination of the risks linked to a no deal scenario in the financial sector, the Commission has found that only a limited number of contingency measures is necessary to safeguard financial stability in the EU27. The Commission has therefore adopted today the following acts:
– A temporary and conditional equivalence decision for a fixed, limited period of 12 months to ensure that there will be no immediate disruption in the central clearing of derivatives.
– A temporary and conditional equivalence decision for a fixed, limited period of 24 months to ensure that there will be no disruption in central depositaries services for EU operators currently
using UK operators.
– Two Delegated Regulations facilitating novation, for a fixed period of 12 months, of certain over-the-counter derivatives contracts, where a contract is transferred from a UK to an EU27 counterparty.
Regarding statistics, the Commission notes that as a consequence of the withdrawal of the United Kingdom, certain adaptations to the rules on statistics are required.
Procedure regarding the delegated acts: In accordance with Article 290 TFEU, the Parliament may object to Delegated Acts, but cannot amend them. In its official referral, the Commission indicated that the 1-month-scrutiny period applies for the RTS, counting from the date Parliament was submitted all language versions (19 December 2018). The Secretariat will undertake a comparison checking if changes were introduced by the Commission in the RTS, which go beyond the correction of typos and wrong references. In this case, a letter from the ECON Chair to the Commission Vice President will be prepared (to inform that the three months deadline for objections applies) for this act – thus until 19 March 2018 – on the grounds that the Commission Delegated Regulation is not the same as the draft RTS submitted by ESMA). The scrutiny period may be extended twice by another month (1+1+1, cf. Article 13(1) first subparagraph of the ESA Regulation). In case of changes, the three-months period could be extended by another three months once.
If ECON considers it appropriate, it may table a reasoned Motion for a Resolution to Plenary objecting to the RTS, stating the reasons for Parliament’s objections and possibly incorporating a request to the Commission to submit a new RTS taking into account Parliament’s recommendations (Rule 105(3) of the Rules of Procedure).
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