On 4 January 2021, the French regulator (the Autorité de Contrôle Prudentiel et de Résolution – ACPR) issued a press release reminding UK authorised financial institutions (including those located in Gibraltar) of their obligations towards customers residing in France.
As of 1 January 2021, European law is no longer applicable in the United Kingdom (UK). As a result, UK financial institutions in the banking and insurance sectors can no longer benefit from the freedom of services (FoS) and/or freedom of establishment (FoE) regimes in accordance with their passporting permissions to offer and provide their services in France.
Some of these UK financial institutions have made arrangements to continue providing their services in France, either by setting-up a French subsidiary, or through an EEA subsidiary which carries on its activities in France under the FoE or FoS regime.
The ACPR press release reiterates that UK financial institutions are required to provide their clients and customers in France, in a clear and comprehensive manner, with tailored information on how their services continue – or cease – to be provided in France.
With respect to the insurance sector, for further information on the form and content of the information to be provided by UK insurers to their French insureds and policyholders, please refer to our article [link to be provided] published in Regulation tomorrow.
- In addition, the ACPR press release reaffirms that contracts entered into with UK financial institutions before Brexit remain valid and must be performed in good faith:
Customers with a bank account or a payment account open in the UK, from a UK authorised service provider or an EEA branch established in the UK or with an account opened with the European branch of a UK regulated establishment remain entitled to maintain their account. They are, however, invited to inquire about the deposit protection rules which are now applicable;
- Insurance contracts entered into with a UK insurance undertaking which has lost its passporting permissions as a result of Brexit remain valid and must be performed in good faith until termination. The UK insurance undertaking must however provide French insureds and policyholders with the required information (please see above) within fifteen days of the end of the transition period, i.e. before 15 January 2021.
The ACPR will carry out checks on the content of communications made to customers residing in France.
The ACPR press release is available through this link (in French).