Brexit: information for retail investments firms in the UK

The retail investments sector is comprised of many relatively small UK firms servicing primarily UK-based customers. If the UK leaves the EU without a withdrawal agreement (a no-deal scenario), UK firms’ ability to continue to service EEA-based customers (including UK expats) remains a concern. EEA-based customers (including UK expats) holding retail investment products serviced by UK providers could be affected if their UK provider cannot operate in the EEA after Brexit.

Update: 20 December 2019

The government has indicated its commitment to the UK leaving the EU with a Withdrawal Agreement on 31 January 2020, followed by an implementation period during which it will negotiate the UK’s future relationship with the EU. Please keep this in mind when reading these pages.

We will update our pages after 31 January 2020 to reflect the UK’s new status.

What will happen in an implementation period? Read our overview to find out.

Servicing your EEA customers in a no-deal scenario

If you have customers in the EEA, you need to decide on your approach to servicing your existing contracts with them. You should take the steps available to you to continue to service customers in accordance with local law and national regulators’ expectations. 

We are clear that firms’ decisions need to be guided by what is the right outcome for their customers.   In many cases, it would be a poor outcome for the consumer for you suddenly to stop servicing them.

As part of your preparations for Brexit, you should be clear whether the services you provide to EEA-based customers are regulated by EU law (for example, MiFID II, the Insurance Distribution Directive (IDD) or Solvency II), and how a no-deal scenario affects your ability to service those customers under EU and local law. For example, if you intend to rely on reverse solicitation to service existing EEA-based customers without local authorisation (for example, under a Member State’s implementation of Article 42 of MiFID), we strongly encourage you to seek legal advice on your plans and understand the national law in each Member State in which you conduct business, to ensure this is permitted in the relevant country and how this impacts your no-deal planning. You should also bear in mind that national regimes may change over time and this could affect your business model in the future.

If you have decided to stop servicing customers in the EU after Brexit, we expect you to treat your customers fairly when winding down or transferring business. This includes considering what would be a fair timeframe for winding down or transferring business and supporting customers while they are in the process of finding alternative providers.