Find out more about the repeal and replacement of retained EU law with our rules under the Financial Services & Markets Act 2023, including key documents, next steps, our core principles for managing this work, and the 'designated activities regime'.
On this page
The Treasury is repealing the firm-facing requirements in retained EU law (REUL), and we are replacing those provisions, where appropriate, with our rules.
There is a significant amount of REUL, and the repeal and replacement work will have an impact on our Handbook. To manage this, we will generally replace repealed REUL provisions in line with some core principles. These principles seek to support our overarching aim for the Handbook: to enhance the overall user experience by making it clear, accessible, and navigable, while reducing regulatory costs. In some cases, we may need to take a different approach in the short term. For example, if we need to replace REUL to address an emerging harm, or to manage the overall pace of the process. But, over time, our approach to replacing REUL will be based on these principles. There is more information on these principles further down this page.
In some cases, the new ‘designated activities regime’ (DAR) will be used when replacing REUL provisions. The DAR is a new regulatory framework introduced by the Financial Services and Markets Act 2023. The DAR does not involve an authorisation gateway, but gives the FCA rule-making, supervisory and enforcement powers over those who carry out designated activities. Together, the DAR and the RAO will set much of our perimeter. We set out more information on the DAR further down this page.
Repeal and replacement documents
|Description and output so far
|Alternative Investment Fund Managers Directive (AIFMD)
We are considering AIFMD alongside Undertakings for the Collective Investment in Transferable Securities (UCITS), given the interlinkage.
February 2023: FCA Discussion Paper 23/2 - Updating and improving the UK regime for asset management (closed for comments 22 May 2023)
October 2023: Having considered the responses to the asset management Discussion Paper 23/2, we set out our priorities for reform in a speech by FCA Chair, Ashley Alder Updating and improving the UK regime for asset management: our priorities
Q3 2024: FCA Consultation Paper on amending the AIFMD regime and re-evaluating the AIFMD rules for non-UCITS retail funds
2025: We will review the regulatory reporting regime
Long-Term Investment Fund (LTIF) Regulation
The LTIF Regulation will not be replaced, because no LTIFs have been established in the UK, and the new UK LTAF regime provides an alternative fund structure better suited to the needs of the UK market.
July 2023: The Government laid legislation to repeal the Long-Term Investment Fund (LTIF) Regulation, which will come into force from 1 January 2024.
|We will consider any updates to our Handbook after the repealing legislation comes into force.
|Insurance Distribution Directive (IDD)
The IDD ensured insurance distributors met certain business conduct standards, prudential and transparency requirements, such as information given to consumers before signing insurance contracts. Many requirements are already in our Handbook, but we are working with the Treasury to complete the replacement of REUL.
September 2023: FCA Consultation Paper 23/19 - Future Regulatory Framework - The Insurance Distribution Directive (consultation closed 9 October 2023)
December 2023: FCA Policy Statement 23/18 - Smarter Regulatory Framework: The Insurance Distribution Directive
|April 2024: entry into force
|Markets in Financial Instruments Directive/ Regulation (MiFID/MiFIR) & Wholesale Markets Review (WMR) reforms
UK Consolidated Tape Framework
The FCA shares the Government’s ambition, as part of the Wholesale Markets Review, to have a regulatory regime for a consolidated tape in place by 2024. This replaces part of MiFID.
July 2023: FCA Consultation Paper 23/15 - The framework for a UK consolidated tape (consultation closed 15 September 2023)
November 2023: Treasury laid the Data Reporting Services Regulations 2023 [draft statutory instrument] in Parliament
December 2023: FCA Consultation Paper 23/33 on Payments to data providers and forms for Data Reporting Services Providers, including Policy Statement for the framework for UK consolidated tape (CP23/15) (consultation closes 9 February 2024)
2024: We intend to commission a study into the impact of a CT in equities, particularly the inclusion of pre-trade data. We will finalise the tender for the bond CTP, with the aim for it to go live in H2 2025.
Rules for the entire bond CTP framework, including feedback to CP23/33, should take effect from 5 April 2024.
December 2023: FCA Consultation Paper 23/27 - Reforming the commodity derivatives regulatory framework (consultation closes 16 February 2024)
Q3 2024: FCA Policy Statement
Transparency reforms (equities)
May 2023: FCA Policy Statement 23/4 - Improving Equity Secondary Markets
|April 2024: entry into force
Transparency reforms (bonds & derivatives)
December 2023: FCA Consultation Paper 23/32 - Improving transparency for bond and derivatives markets (consultation closes 6 March 2024)
|H2 2024: Policy Statement
Forthcoming FCA Consultation Paper
Forthcoming FCA Discussion Paper on longer-term policy changes
|Money Market Funds Regulation (MMFR)
We are working with Treasury and the Bank of England to improve MMF resilience, and to reduce the nature and extent of systemic risk and potential vulnerabilities in the market.
May 2022: FCA Discussion Paper 22/1 - Resilience of Money Market Funds (closed for comments 23 July 2022)
December 2023: FCA Consultation Paper 23/28 - Updated regime for Money Market Funds (consultation closes 8 March 2024)
December 2023: Treasury’s draft Money Market Funds (Provisions for General SI) Regulations 2024, and accompanying Policy Note (closes for technical comments on 24 January 2024)
|2024: FCA Policy Statement
|Packaged Retail and Insurance-based Investment Products (PRIIPs) Regulation
We are working with the Treasury to introduce a more targeted and proportionate disclosure regime once the PRIIPs Regulation is repealed. The new UK retail investment disclosure regime will be called ‘consumer composite investments’
December 2022: FCA Discussion Paper 22/6 - Future Disclosure Framework (closed for comments 7 March 2023)
December 2022: Treasury’s PRIIPs and UK Retail Disclosure: consultation (closed for comments 3 March 2023)
November 2023: Treasury’s draft Consumer Composite Investments (Designated Activities) Regulations 2024 Statutory Instrument, and accompanying Policy Note (UK Retail Disclosure Framework) (closes for technical comments on 10 January 2024)
H1 2024: FCA Consultation Paper
H2 2024: FCA Policy Statement
|Payment Accounts Regulations (PARS)
We are working with Treasury on its plans to remove burdensome customer information requirements related to personal bank accounts.
December 2022: Treasury's consultation on [customer] information requirements in the Payment Accounts Regulations (PARs) (consultation closed 17 February 2023)
|The consumer information aspects of PARS are being repealed and will not be replaced with FCA rules.
|Payment Services Directive 2 (PSD2) & e-Money Directive (EMD) & Regulations
We want to improve the payments regime to enhance consumer protection and promote competition and innovation. We are working with the Treasury on a new safeguarding regime. We will follow this with further work to consider a new prudential regime, changes to agents’ oversight, and possible extension to the Financial Services Compensation Scheme (FSCS) and the Senior Managers & Certification Regime (SM&CR).
July 2023: Treasury laid the Electronic Money, Payment Card Interchange Fee and Payment Services (Amendment) Regulations 2023
|Q2 2024: FCA Consultation Paper
Lord Hill’s UK listing review recommended an overhaul of the UK’s listings regime. We are working with the Treasury to replace the Prospectus Regulation and implement a new regime for offers of securities to the public and admissions of securities to trading on markets.
May & July 2023: FCA engagement papers
July 2023: Treasury’s draft Public Offers and Admissions to Trading Regulations 2023 Statutory Instrument, and accompanying Policy Note (closed for technical comments on 21 August 2023)
November 2023: Treasury laid The Public Offers and Admissions to Trading Regulations 2023 [draft statutory instrument] in Parliament
December 2023: FCA Engagement feedback on the new public offers and admissions to trading regime
Q3 2024: FCA Consultation Paper
This legislation will come into effect after the FCA has made the relevant new rules.
|Securitisation Regulation (SR)
The Treasury’s 2021 review of the SR identified three areas for change: reporting, due diligence, and risk retention. A fourth area relevant for the FCA (Alternative Investment Fund Managers) remains in legislation. We are working with the Treasury and the Prudential Regulation Authority on reforms in the areas identified.
July 2023: Treasury’s draft Securitisation Regulations 2023 Statutory Instrument, and accompanying Policy Note (closed for technical comments on 21 August 2023)
August 2023: FCA Consultation Paper 23/17 - Rules relating to Securitisation (consultation closed 30 October 2023)
October 2023: Addendum to FCA CP23/17 (consultation closed 20 November 2023)
Q2 2024: FCA Policy Statement
Some of the legislation in the Securitisation Regulations, such as provisions that give the regulators powers, will come into force immediately after it is made. The rest will come into force at the same time as the repeal of the SR and related retained EU law is commenced. Concurrently, the FCA and PRA replacement rules will start to apply. Treasury may lay a separate SI with consequential amendments and other provisions following the 2023 SI.
|We plan to consult on further changes in Q4 2024/Q1 2025, including adjusting the distinction between public and private securitisations and making the reporting regime more proportionate, following the discussion set out in our August 2023 Consultation Paper 23/17.
|Q4 2024/Q1 2025: FCA Consultation paper
|Short-Selling Regulation (SSR)
We are working with Treasury to ensure that the UK’s short-selling regime allows short selling that benefits the orderly and effective functioning of the market whilst protecting against the risks.
December 2022: Treasury's Short Selling Regulation: Call for Evidence (call for evidence closed on 5 March 2023)
July 2023: Treasury Consultation on Sovereign Debt and Sovereign Debt Credit Default Swap Regime (consultation closed on 7 August 2023)
November 2023: Treasury’s draft Short Selling Regulations Statutory Instrument, and accompanying Policy Note (closes for technical comments 10 January 2024)
November 2023: Treasury laid the final Short Selling (Notification Threshold) Regulations 2023 in Parliament to increase the position reporting threshold to 0.2% (to apply from 5 February 2024)
10 January 2024: Treasury deadline for technical comments on draft statutory instrument
Treasury plans to lay the statutory instrument before Parliament in 2024, subject to Parliament time allowing
This legislation will commence at the same time as the FCA makes new rules, alongside the repeal of the SSR and other related legislation
Our principles for replacing retained EU law in our Handbook
- Consolidate requirements as far as possible so that, over time, the FCA Handbook becomes the ‘one stop shop’ for firm-facing regulatory requirements. Regulatory requirements are currently spread across multiple sources, including retained EU regulations, primary and secondary UK legislation, retained EU technical standards, and regulators’ rules. We will aim to consolidate and integrate, as far as possible, all regulatory provisions that we are responsible for, into the Handbook. Consolidation is likely to increase the length of the Handbook, but it will help reduce the regulatory burden because the relevant provision should be easier to find.
- Use the current Handbook structure, only creating new sourcebooks where necessary. The Handbook consists of different sourcebooks, including the Conduct of Business sourcebook (COBS) and the Systems and Controls sourcebook (SYSC). These sourcebooks are arranged into blocks, such as the Business Standards block, which includes COBS. To avoid disruption we will incorporate new rules into the existing structure. We will only create new sourcebooks where necessary: for example, where the requirements are sizable and self-contained enough to warrant a separate sourcebook.
- Rely on existing requirements in our Handbook, where relevant, and consider if it is necessary to reflect the repealed REUL provision in our Handbook. We will consider whether any existing Handbook rules sufficiently overlap with REUL provisions in scope and impact. If so, that REUL could be repealed without replacement. Otherwise, we could modify or extend the existing Handbook rules to adequately replicate REUL provisions without inserting entirely new rules or sections.
- Rely on outcomes rather than prescriptive requirements, where appropriate. We will consider whether it is necessary to recreate prescriptive REUL requirements, or if higher-level rules, like the Consumer Duty (possibly supported by guidance, to ensure predictability of application) can achieve the same outcome.
- Reduce complexity, both in drafting style and by seeking to align standards across sectors, where appropriate. Our aim is to draft rules using our Handbook drafting format and style, rather than keeping the language and structure of REUL. We will also aim to align standards when addressing similar thematic issues across different files.
Designated activities regime (DAR)
Some activities currently regulated under retained EU law are not ‘regulated activities’ under the Financial Services and Markets Act 2000, and may be carried out by non-financial services entities or persons without needing to be authorised by us (for example, seeking the listing of a company’s shares on a regulated market). We currently supervise and enforce these activities under retained EU law, but, in many cases, we lack rule-making powers for them in relation to unauthorised persons.
The designated activities regime (DAR) framework enables the Treasury to ‘designate’ activities, and to confer rule-making, supervisory and enforcement powers on us over these activities. Our rule-making under the DAR will apply in relation to the designated activity, but not the other unrelated activities of the person carrying on the designated activity.
The DAR does not require authorisation, and designated activities can be done by both authorised and unauthorised persons. However, some persons carrying on a designated activity may also be carrying on a ‘regulated activity’ for which authorisation is required, depending on the circumstances; for example, the proposed designated activity of manufacturing a consumer composite investment (ie a PRIIP) could also constitute a ‘regulated activity’.
Initially, the Treasury will designate activities to enable us to make rules to replace relevant provisions in retained EU law that are being repealed under the Act. But use of the DAR is not restricted to these activities, and the Treasury will be able to designate further activities in future.
This will ensure that the regulatory framework and perimeter can adapt, for example, for new types of activity where the risks associated with a particular activity change in a way that merits bringing it within scope of regulation, but where authorisation would be disproportionate.