Communication in the context of Brexit
Press release 20/03
This communication follows up on previous communications issued by the Commission de Surveillance du Secteur Financier in the context of Brexit and notably press releases 19/05, 19/18, 19/33, 19/34, 19/41, 19/43, 19/48 and 19/54 regarding the transitional regime under the laws of 8 April 2019 on Brexit (the “Brexit Laws”), as well as the mandatory notifications through the eDesk portals.
The purpose of the transitional regime under the Brexit Laws was to ensure that UK entities providing financial services in Luxembourg under the EU passport would be able to continue their activities for a limited period in the event of the UK leaving the EU without concluding a withdrawal agreement based on Article 50(2) of the Treaty on European Union (“hard Brexit”).
Following the formal adoption of the withdrawal agreement by the Council of the European Union on 30 January 2020, the UK will be leaving the EU with a withdrawal agreement on 31 January 2020 at midnight (Brussels time). According to the terms of the withdrawal agreement, a time-limited transition period will last until 31 December 2020 (the “transition period”). During such transition period, EU laws and regulations shall continue to apply in the UK and UK entities can continue to work in Luxembourg on the basis of their passporting rights.
The scenario of a hard Brexit, under the assumption of which previous communications have been issued by the CSSF, is therefore no longer relevant. As such, the CSSF’s individual decisions granting the 12-month transitional regime to UK entities and all notifications made in that context through the dedicated eDesk portals are lapsing. The dedicated e-Desk portals are closed with immediate effect.
The CSSF would like to stress that notwithstanding the current political developments, impacted entities should continue to take all necessary steps to prepare and anticipate the end of the transition period. Continued progress should also be made on contingency planning, notably to ensure that customers and investors are adequately informed of any steps taken in order to mitigate potential “cliff-edge” issues after the end of the transition period.
The CSSF will continue to communicate on Brexit-related issues via press releases in the course of the transition period as necessary.