The temporary authorisation regime will allow EEA DRSPs authorised under MIFID to provide a data reporting service in the UK for a limited period after exit day, in the event there is no implementation period from the end of March 2019.
The Treasury Markets in Financial Instruments (Amendment) (EU Exit) Regulations 2018 SI makes provision for temporary authorisations for MIFID authorised EEA DRSPs to provide a data reporting service in the UK for a limited period after exit day, in the event there is no implementation period from the end of March 2019.
We continue to prepare for a range of scenarios, including one in which the UK leaves the EU without a deal and without entering an implementation period.
| On this page | ||
|---|---|---|
| The current situation | What will change after Brexit | How the regime will work |
| Connectivity to the FCA | The notification process |
The current situation
MiFID II allows DRSPs established and authorised under MIFID in an EEA member state to provide data reporting services in the UK based on its home member state authorisation.
What will change after Brexit
EEA DRSPs authorised under MIFID will no longer be able to provide a service in the UK without authorisation from us.
The temporary authorisation regime will allow EEA DRSPs authorised under MIFID to provide a data reporting service in the UK for a limited period after exit day (29 March 2019) while enabling it to seek authorisation in the UK, on a permanent basis.
How the regime will work
EEA DRSPs authorised under MIFID currently operating in the UK, or EEA DRSPs authorised under MIFID seeking to operate in the UK for the first time, will need to let us know if they intend to provide a service to operate in the UK after exit day.
This temporary authorisation will last for up to 1 year from exit day. We expect firms in the regime to follow the requirements in the Data Reporting Services Regulations 2017 and relevant provisions of the FCA Handbook.
Connectivity to the FCA
EEA DRSPs authorised under MIFID providing a data reporting service in the UK that requires connecting to our system for the first time under the temporary authorisation regime, will need to on-board to our Market Data Processor (MDP) system and pay the applicable fee.
MDP conformance testing can take between 6-8 weeks subject to an entity’s onboarding requirements. Read our information on our MDP on-boarding process. Any questions in relation to the MDP on-boarding process should be sent to [email protected].
EEA DRSPs authorised under MIFID that have on-boarded to our MDP system currently providing one data reporting service in the UK, will need to conformance test if they are going to provide an additional data reporting service and submit a new market data type. For example, this would include an EEA DRSP that is providing the service of an approved reporting mechanism (ARM), and now wishes to provide the service of an approved publication arrangement (APA), where it is authorised to do so by its home state regulator.
The notification process
The Data Reporting Services Regulations 2017 (DRS Regs), amended by the Markets in Financial Instruments (Amendments) (EU Exit) Regulations 2018, provides that an entity established and authorised under MiFID to provide date reporting services (or verified as able to do so under [article 59] MiFID) in an EEA member state can notify us that it wishes to provide a data reporting service in the UK from exit day.
If an entity notifies us under Regulation 12A of the DRS Regs and we determine that the notification is valid, it may be deemed as authorised for up to 1 year after exit day while enabling it to seek authorisation in the UK, on a permanent basis.
You may submit a complete application for full authorisation (or for verification) in the UK, or, submit the deemed authorisation notification form. We will decide within 28 days if your notification is valid. If you apply for full authorisation, we will determine your application within six months of receiving the completed application.
You must notify us by 15 February 2019. If you do not notify us by this date you will not be able to provide a data reporting service within the deemed authorisation regime, and on exit day you will have to be authorised under the DRS Regs to provide a data reporting service in the UK.
To apply for authorisation send us your:
- completed application form (Annex I)
- notification form for list of members of a management body (Annex II)
- appropriate fee
- supporting documentation
To submit a deemed authorisation notification form send us your:
- completed deemed authorisation notification form
- supporting documentation
You should send the completed application form or deemed authorisation notification form along with supporting documentation to [email protected].
Even if you submit a valid notification, you will only be able to provide a service in the UK once you have demonstrated conformance with our technical specification and successfully on-boarded to our Market Data Processor (MDP) system.
Supervisory notification obligations of entities deemed to be authorised under the DRS Reg to us
We expect you to follow the requirements in the DRS Reg and relevant provisions of the FCA Handbook, including:
- MAR 9 Annex 6 - to notify us of any change to the membership of the management body before such change takes effect, or where this is not possible, within 10 working days after the change.
- MAR 9 Annex 5 - notification of material change in information provided at the time of deemed authorisation
- MAR 9 Annex 9 - ad hoc notifications to include breaches in physical and electronic security measures and service interruptions or connection disruptions and, in the case of ARMs, errors or omissions in the transaction reports caused by the ARM.
Fees
In addition to the fee for onboarding to our Market Data Processor (MDP) system, we propose that EEA DRSPs in the temporary authorisation regime should pay periodic fees from 1 April 2019 for the 2019/20 fee-year on the same basis as UK authorised DRSPs. On 23 November 2018, we published CP18/36 which includes the proposed changes to the fees requirements.
While there will be no fee associated with the notification to join the temporary authorisation regime, the authorisation fees for EEA DRSPs (that exit the temporary authorisations regime by applying for full authorisation), will be based on those for UK applicants for authorisation.