ASIC gears up for Brexit

ASIC is liaising with the UK corporate regulator, Bank of England and local stakeholders to prepare for Brexit's impact, it said in a statement.

ASIC said it will enter into new memorandums of understanding (MoU) with the UK's Financial Conduct Authority (FCA). This is because the FCA is set to take over from the European Securities and Markets Authority (ESMA), the overseeing of credit rating agencies, benchmarks and trade repositories post Brexit.

Similarly, the Bank of England (BoE) will also take over from ESMA, in relation to non-UK counterparties. ASIC said it will update its information sharing arrangements on clearing and settlement facilities with the BoE.

ASIC and Reserve Bank of Australia are working with the BoE, who has confirmed it will conduct an equivalence assessment for Australia's regime for central counterparties.

ASIC is also reviewing the potential impacts on 298 UK firms operating in Australia. This includes 285 UK firms operating in Australia under an AFSL exemption, five UK market operators which hold an Australian market licence and six operating under exemption notices.

"ASIC is working with the RBA and the BoE to ensure business continuity for systemically important Australian firms operating in the UK," ASIC said in a statement.

"The ASX Group has notified the BoE that it wishes to enter the UK central counterparty temporary recognition regime and therefore we expect it to continue to be able to provide clearing services in the UK. ASIC has identified a small number of regulatory actions that will be needed and, as necessary, we envisage completing these steps ahead of the UK's withdrawal from the EU in a 'no-deal' scenario," it said.

A 'no deal' scenario is if the UK leaves the EU at 11pm GMT on 29 March 2019 without a withdrawal agreement and framework for a future relationship in place between the UK and the EU.

Read more: ASICBrexitBank of EnglandESMAFCAReserve Bank of AustraliaASX GroupEuropean SecuritiesFinancial Conduct AuthorityMarkets Authority
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