On 23 April 2019, the FCA published a speech by its Chief Executive, Andrew Bailey, on the future of financial conduct regulation. Key points to note within the speech include:
- public interest objectives which are specific to the conduct of financial services, sit within the very broad landscape of all public policy and public interests;
- using regulation to enable change and innovation consistent with the FCA’s public policy objectives has the potential to further re-shape the nature of regulation;
- two key questions to answer in the context of a post-Brexit future are whether EU and UK approaches to regulation are notably different (and the related implications of this), and what equivalence arrangements does the UK want and expect?
- the FCA has always been of the view that a transitional period is important to avoid the cliff edge risks of a no deal outcome. The extension of Article 50 is welcome in this regard but preparations a full range of Brexit scenarios are still required;
- during a transitional period, the FCA will continue to be an active member of ESMA and work closely with its EU27 counterparts on legislation that is in development;
- the UK and the EU has generally not differed is their agreement on the objectives sought by financial services regulation, which will not change with Brexit; and
- if the UK is left to its own devices, with its common law system and large, global financial markets, would construct financial conduct regulation in a different way. It would take on board practical experience more rapidly and be based more on principles that emerge from experience in public policy and somewhat less on detailed rules that can become overly set in stone.