On 26 September 2019, the FCA provided an update on its temporary transitional power (TTP).
The FCA has published draft directions which update those made on 28 March 2019. The FCA has also updated its explanatory note providing guidance on the use of the TPP.
The FCA reports that the main updates relate to:
- extending the proposed duration of the directions issued under the TTP from 30 June 2020 to 31 December 2020;
- updating the provisions relating to prudential requirements in its directions to reflect new HM Treasury legislation and FCA exit instruments published since 29 March 2019. The FCA’s policy approach has not changed;
- revoking certain directions in relation to payment services, provided by EEA credit institutions in the financial services contracts regime, as these are no longer needed because of legislative amendments made by the Government; and
- applying a standstill direction to allow EEA Central Banks and the European Central Bank to continue to rely upon their status as exempt persons until 31 December 2020.
The FCA states that it does not expect to make significant changes to the draft directions in advance of exit day.
The FCA reminds firms that there are specific areas where it will not be granting transitional relief. In these areas, it expects firms and other regulated entities to take reasonable steps to comply with the changes to their regulatory obligations by exit day.