On 17 January 2019, HM Treasury published a draft version of the Uncertificated Securities (Amendment and EU Exit) Regulations 2019, together with an explanatory memorandum.

The draft statutory instrument serves two purposes:

• it amends the Uncertified Securities Regulations (the USR) in light of the EU Central Securities Depositories Regulation (CSDR) as implemented in the UK via the Central Securities Depositories Regulations 2014 and the Central Securities Depositories Regulations 2017. In particular, the draft statutory instrument expands the concept of “operator” for the purposes of the USR ensuring that the term covers recognised central securities depositories (CSDs) that are established in the UK or CSDs that are established in the EEA or third countries and authorised or recognised by the authorities of an EEA State or the European Securities and Markets Authority. The draft statutory instrument also provides transitional provisions, to ensure that operators of systems that were approved as operators under the USR prior to 30 March 2017 can continue to operate under the current version of the USR, pending their authorisation as a CSD under the CSDR regime. The provisions which are being removed from the USR to ensure the successful operation of the CSDR regime will come into force regardless of the outcome of the Brexit negotiations; and
• it addresses deficiencies in UK law and retained EU law that arise from the UK leaving the EU. It forms part of HM Treasury’s contingency planning for a no deal scenario, making the necessary changes to ensure that the UK continues to have a functioning financial services regime from exit day, in that event. More detail can be found in section 7 of the explanatory memorandum.

You can track the financial services Brexit EU Exit statutory instruments (as well as gain access to our Brexit resources) on our Brexit Pathfinder hub. Registration is free via the NRF Institute portal. Conformed copies of the EU Exit statutory instruments are available exclusively through our PathfinderPLUS service. To gain access to PathfinderPLUS, please contact Jochen Vester or Simon Lovegrove.