Brexit - EBA issuses preparedness notice to financial institutions

The European Banking Authority (EBA) has issued a preparedness notice to all banks in light of the UK’s transition period ending on 31 December 2020 as per the Withdrawal Agreement.

The notice can be found here

The notice sets out expectations of the supervisory authorities with respect to financial firms as well as payment and e-money institutes wishing to continue offering services to EU27 based clients – i.e. seeking authorisation from an EU NCA and fulfilling the commensurate risk and presence requirements.

The EBA also makes clear that account information service providers (AISPs) and payment initiation service providers (PISPs) that are authorised or registered in the UK will – post transition period – no longer retain access to payment accounts held with EU27 payment service providers.

Finally, the EBA urges all firms to engage with their clients – especially where cross-border and passportable services are being offered – and inform them about the contingency plans/authorisations that have been drawn up that would enable continued provision of services out of an EU27 entity. Likewise, firms are expected to inform their EU-based clients where their services will cease to be available because they have not established EU27-based entities.

This information was provided to the VDT by the EACT.