Financial Services: EU Law

(asked on 18th April 2019) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, whether the Government's ministerial equivalents and exemption directions in financial services for the (a) EU and (b) EEA, made on 11 April 2019 are a result of discussions with the EU on the EU's forthcoming equivalents and exemption directions.


Answered by
John Glen Portrait
John Glen
Paymaster General and Minister for the Cabinet Office
This question was answered on 25th April 2019

The Equivalence Directions made with respect to EU-adopted International Financial Reporting Standards (EU IFRS) deliver a commitment made by HM Treasury in November 2018. In the explanatory information for the Draft Official Listing of Securities, Prospectus and Transparency (Amendment) (EU Exit) Regulations 2019, published in November 2018, HM Treasury signalled its intention, in a no-deal scenario, to issue an equivalence decision with respect to EU IFRS in time for Exit day. This will ensure that issuers of securities in European Economic Area (EEA) states can continue to use EU IFRS to prepare financial statements for Transparency Directive requirements, and for the purposes of preparing a prospectus under the Prospectus Directive.

HM Treasury and the EU have decided to provide exemptions for central banks and certain public bodies under specific financial services regulations in the event that the UK withdraws from the EU without an agreement. This decision, in the Exemption Directions made with respect to EU bodies, was taken as a result of an exchange of letters between HM Treasury and the EU Commission specifically on this matter in January 2019.

HM Treasury and the EEA European Free Trade Association (EEA EFTA) countries of Norway, Iceland and Liechtenstein have decided to provide exemptions for central banks and certain public bodies under specific financial services regulations in the event that the UK withdraws from the EU without an agreement. This decision, in the Exemption Directions made with respect to EEA bodies, was taken as a result of an exchange of letters between HM Treasury and the EEA EFTA countries specifically on this matter in April 2019.

Both sets of exemptions are important for avoiding disruption to the financial services sector, and the businesses and individuals relying on it, in the event that the United Kingdom withdraws from the European Union without an agreement.

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