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Financial Markets Law Committee at the Bank of England: uncertainty in EU Withdrawal Bill increases complexity for market participants

September 26, 2017

The Head of Brunel Law School and BiE member, Prof Arad Reisberg, continues to contribute to the Financial Markets Law Committee’s (FMLC) Brexit High Level Advisory Group at the Bank of England, which discusses and recommends on issues relating to legal uncertainties around Brexit.

 

Following the publication of the European Union (Withdrawal) Bill 2017 (the “Withdrawal Bill”), the Ministry of Justice invited the FMLC to provide feedback.  

 

To this end, a letter was sent to the Ministry of Justice drawing attention to issues of legal uncertainty stemming from Clause 3 of the Withdrawal Bill, which concerns the incorporation of direct E.U. legislation. 

 

 

The letter predicts an increase in complexity for market participants attempting to establish which legal obligations apply to them, such as in a situation where the U.K. government signals its intention to implement a particular E.U. provision in direct legislation which had not come into application before exit day. Such a provision could become applicable in the E.U. at a date before the U.K. has had time to implement it domestically, leaving market participants unsure as to their obligations. 

 

The Committee has identified similar concerns in relation to ‘tertiary’ EU legislation, and concludes that legal uncertainty in the Act is amplified by ‘the opacity surrounding the manner in which the role of the European Supervisory Authorities will be replicated in the U.K. after exit day’. 

 

The FMLC letter can be accessed from here.

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