The FCA has told firms to make clients aware of changes to products and services that will come about after Brexit.
Speaking at the Third UK Brexit summit, FCA international director Nausicaa Delfas said while the regulator is preparing for all the possible scenarios, they expect individual firms to do the same.
Delfas (pictured) says: “You know your businesses best, and you will be doing your own contingency planning.”
She says: “We are expecting you to take your own legal advice on what a no-deal Brexit might mean for you, and, of course, for your customers, and any steps you may need to take to manage this.”
Delfas made a point firms should be communicating with customers “in a timely fashion” about any possible changes to its ability to provide services post Brexit, and if any changes may affect the customer’s products or contracts.
She says: “We expect firms to let customers know if there will be any changes […] for example in relation to their rights and protection under FSCS and the Financial Ombudsman Service schemes or changing contractual terms.”
Delfas used her speech to reiterate the regulator is working to ensure minimum disruption in the case of a no-deal Brexit:
“We are preparing for a range of scenarios, including a so called ‘hard exit’. Of course, we are hopeful for a better outcome – we are strongly supportive of a transition or implementation period, and will do everything we can to support achieving this.”
The FCA says it is working to mitigate ‘cliff-edge’ risks by getting a high level of equivalence with EU regulation.
“Of course, there is a broader solution to removing cliff-edge risks which is for both the UK and EU to commit to taking reciprocal equivalence decisions on each other’s regimes, as early as possible.
“Our work to onshore the EU rulebook, in the consultation I referenced earlier, demonstrates that on day one, the UK will have the most equivalent framework to the EU of any country in the world.
“We may be leaving the EU, but EU and UK financial markets will remain heavily interconnected and we need – and want – to continue to have close cooperation with our EU counterparts at European Securities and Markets Authority and at the National Competent Authorities.
In October the regulator published plans for a no-deal Brexit, with proposals to convert European law into British rules from next year.