The Brexit process is presenting businesses, investors and banks with unprecedented challenges. The time pressure on firms to prepare themselves and their clients for the UK’s exit from the EU is increasing. However, it remains unclear what kind of exit and future relationship arrangements will be agreed upon.
AFME has highlighted the need for transitional arrangements which would keep existing market arrangements in place for a limited period of time following the UK leaving the EU. This is necessary to provide certainty and stability to business and market participants as they prepare for the future arrangements that have yet to be agreed between the EU27 and the UK.
However, while some cliff edge risks would be mitigated (in whole or in part) by a longer transition period, risks remain that need to be addressed irrespective of a transition.
In this paper, AFME has therefore focused on issues which it believes require intervention from policymakers and/or regulators in the UK and EU27 and are not easily resolved by banks’ own plans or industry solutions.
AFME hopes this paper will provide further helpful clarity for the forthcoming discussions on the future relationship between the European Union and the UK.