The United Kingdom’s Brexit referendum has shaken the financial services industry with an unprecedented event since the birth of the European Union. Following the passing of the Act of Parliament on 1st February 2017 which triggered Article 50 of the TFEU, the UK is officially placed to withdraw from the European Union.
The United Kingdom has established a time-frame of approximately two years within which they expect to formally leave the EU. In the meantime, it remains unclear how hard Brexit will affect the financial services sector. One of the primary concerns is that the loss of passporting rights can have devastating effects for numerous business operations registered in the UK. Passporting rights are crucial in allowing business operations such as authorised banks, insurance companies and insurance intermediaries as well as fund managers to operate and conduct their business freely across the other EU Member States as well as give business operations based in Europe unfettered access to the UK.
These potential negative effects therefore require a contingency plan. Should passporting rights no longer be maintained following Brexit, many UK insurers would need to set up subsidiaries in other EU Member States in order to retain access to the single market and access to the passporting regime.
GTG Advocates has the necessary expertise to assist insurance business operations by:
Disclaimer: This article is not intended to impart legal advice and readers are asked to seek verification of statements made before acting on them.