Unnoticed among the run of other major world events, the Treasury's important consultation on the second phase of its review of the future of financial services regulation post-Brexit has drawn to a close after four months. The BSA has warmly welcomed, and supports, HMT’s sensible proposals. There are some very clear and obvious wins.
First: if it ain't broke, don't fix it. The UK's own model of regulation, under FSMA 2000, was exhaustively discussed, scrutinized, and legislated in 1997-2000 and has stood the test of time. Unlike the EU model, detailed regulation is left to expert independent regulators within a framework architecture clearly set out by Parliament. Now we are no longer bound by the EU straitjacket it's the obvious choice for the UK: it’s home-grown, it works - what's not to like?
The second is to consolidate regulatory material, now originating both from on-shored EU material and domestic rulemaking, in a single corpus. We move on from what some have described as the alphabet soup of EU regulation: CRR, MiFID 1 and 2, DGSD, BRRD, ITS, RTS, EBA, XYZ (we made the last one up). As we said in our response, we recognise this cannot happen overnight, but it’s absolutely the right objective.
We have been lobbying for these two core proposals for a post-EU landscape since late 2016 so these proposals are a welcome victory for common sense.