For the EEA payment service providers now in the FCA’s reach because of Brexit, the past few months have been a sharp learning curve as to expectations. CP21/3 provides a steer through the proposed changes to the Payment Services and Electronic Money Approach Document.
At the beginning of February this year, eight weeks prior to the original 29th March Brexit date, we published a blog entitled “No-deal Brexit – is there a regulatory backstop?” In this blog, we attempted to summarise what firms could expect in the event we crashed out having failed to agree transitional provisions with the EU27. Eight months, four failed votes and one prime minister later we find ourselves in a painfully similar situation eight weeks before the new Brexit date of 31st October. In this blog we will revisit some the issues addressed in our initial blog, and how these may have changed since the time of writing. I write this though at a time of the utmost uncertainty, with legislation proposed to remove the possibility of No Deal, another Prime Minister under threat, and the possibility of a General Election that might yet result in a new referendum. Nevertheless, let’s deal with the here and now…
As we embark upon yet another week of uncertainty regarding what Brexit deal, if any, the Prime Minister might secure, the latest in my Q&As with EU regulators sees me heading to Sweden.
I fondly recall, back in my FSA days, visiting Finansinpektionen (the Swedish FSA) to find out more about the payments market in Sweden and how they approached licensing and supervision, given they were one of the few EU Member States that took advantage of article 26(1) of PSD1 to allow for ‘Small Payment Institutions’ (SPIs). Colleagues at Finansinspektionen were friendly, approachable and keen to exchange knowledge and experience, so I was hopeful that they would continue to be so despite my own departure from the regulator. I am thankful, therefore, to Roger Jacobsson for sparing the time to answer our standard questions regarding UK payment/e-money institutions looking to establish a second business in Europe to benefit from passporting rights.
So, after weeks of conversations with various regulators across Europe, I am delighted to be able to share the views of the Central Bank of Ireland towards UK payment and e-money institutions looking to set up a new office in Ireland as part of their Brexit strategy. Since firms started thinking about their Brexit strategies, Ireland has often been mentioned by clients of fscom as their first consideration, principally based on common language and proximity. Indeed, being based in Belfast, we find our own proximity to Dublin to be particularly helpful in helping firms with the Central Bank. As we have seen though, there are many other factors that need to be taken into account. As ever though, I do not pass comment on the Central Bank’s views in this article, preferring to simply pass them on to help you make up your own mind. So, thanks again to the Central Bank for granting me access and, in particular, to Russell Burke from the Payments Authorisation Team.
Following my well-received blog about the ACPR’s approach to UK payment/e-money institutions applying for authorisation in France as part of their Brexit strategy, it was almost obvious that I should follow this up with consideration of near-neighbours Belgium.
For some, Brexit may still seem like something out of a fairy tale but, whether you are for or against, it will become a reality next March 2019.