On 22 September 2021, there was published on the legislation.gov.uk website The Capital Requirements Regulation (Amendment) Regulations 2021 together with an explanatory memorandum.

The Financial Services Act 2021 (FS Act) enables HM Treasury to transfer responsibility for implementing the Basel standards to the PRA, by providing a power for HM Treasury to revoke relevant provisions of the onshored Capital Requirements Regulation (CRR), thereby allowing the PRA to make rules in those areas. The Regulations exercises the powers set out in section 3 of the FS Act to revoke provisions of the CRR and make consequential amendments. The Regulations also exercise powers in the European Union (Withdrawal) Act 2018 to fix deficiencies which have arisen out of the UK’s exit from the EU.

The Regulations also amend one of the routes that recognised central counterparties (CCPs) are granted Qualifying CCP status (QCCP). For firms outside of the temporary recognition regime, there is a separate transitional regime within Article 497 CRR that allows CCPs, who submitted applications for recognition ahead of the implementation period completion day (IPCD) to be treated as if it were a QCCP for 2 years whilst applications under Article 25 of the onshored European Markets Infrastructure Regulation are being considered. For overseas CCPs that made a recognition application under Article 25 EMIR before IPCD they can be treated as QCCPs until the end of 2022. HM Treasury can extend the two year transitional period (via a statutory instrument) for one year only. The Regulations amend Article 497 CRR to provide HM Treasury with the ability to extend the transitional period indefinitely (one year at a time).