As markets continued to digest Friday's referendum result, the UK's Financial Conduct Authority said that EU-born regulation is in the hands of parliament.
The UK's vote to leave the European Union will have “significant” implications for the country, said the Financial Conduct Authority.
Much of the UK's current financial regulation comes from EU legislation. This will remain applicable until any changes are made, which will be a matter for the country's government and parliament, the FCA said in a statement. In the meantime, firms will be required to continue with implementation plans for legislation yet to come into effect.
This includes, for example, the EU’s Markets In Financial Instruments Directive, known by the acronym of MiFID II. The regulation, due to kick in at the start of 2018, will require fund managers to have full transparency on where their products are being sold.
“Consumers’ rights and protections, including any derived from EU legislation, are unaffected by the result of the referendum and will remain unchanged unless and until the government changes the applicable legislation,” the FCA said.
The longer term impacts of the Brexit on the overall regulatory framework for the UK will depend, in part, on the relationship that the country seeks with the EU in the future, the regulator added. The FCA said it is in very close contact with the firms it supervises as well as the Treasury, the Bank of England and other UK authorities.
“We will work closely with the government as it confirms the arrangements for the UK’s future relationship with the EU,” it said.