On 3 August 2023, HM Treasury issued a post implementation review of the Financial Market Infrastructure Administration (England and Wales) Rules 2018 (the Rules).
The Rules set out the detailed procedures for a financial market infrastructure (FMI) special administration regime (SAR) as introduced by Part 6 of the Financial Services (Banking Reform) Act 2013. The objective of the Rules is to clearly set out what procedures the Bank of England and the FMI administrator must follow.
The post implementation review finds that the FMI SAR has not been utilised since its implementation and does not impose any requirements on firms who have not entered administration. As such there has been no impact to date. Whilst the FMI SAR has not yet been used in any administration or insolvency proceedings, given no firms in scope have been placed into administration, HM Treasury continues to judge that the regime will enable the continued functioning of recognised payment systems, recognised central securities depository and designated key service providers to those systems if any of these firms fail. Maintaining the existing regime is therefore important to ensure that there is an effective process in place to manage any future failures of FMI firms. For this reason, HM Treasury judges that the Rules remains fit for purpose and continue to ensure that the FMI SAR is operationally effective.