On 17 December 2020, HM Treasury published a revised version of the special resolution regime code of practice.

The code, issued in accordance with sections 5 and 6 of the Banking Act 2009 (the Act), supports the legal framework of the special resolution regime, and provides guidance as to how and in what circumstances the authorities will use the special resolution tools. Section 1 of the code deals with banks, building societies, investment firms and banking group companies. Section 2 deals with central counterparties.

The code was previously updated to reflect both changes to the Act following the implementation of the Bank Recovery and Resolution Directive (BRRD) and also the changes in the regulatory architecture, with the creation of the PRA and FCA. It was further updated to reflect changes following the Bank Recovery and Resolution Order 2016. This latest update reflects changes arising from the UK’s exit from the European Union and the Bank Recovery and Resolution (Amendment) (EU Exit) Regulations 2020, which alongside regulator rules implemented BRRD II in the UK.

The current version of the code applies to use of the special resolution regime after the end of transition period, 11pm on 31 December 2020 as defined in the European Union (Withdrawal Agreement) Act 2020. The previous version of the code (March 2017) applies to use of the regime before the end of transition period. Any reference to legislation in the code is to that legislation as amended. Any reference to retained EU law in the code is to that legislation as retained in accordance with the European Union (Withdrawal) Act 2018, and as amended (in particular in accordance with the European Union (Withdrawal) Act 2018).