Dichotomy is embedded in life, or, life
embeds dichotomy to force balance. Why don’t we look at the other side of
Brexit then? Is it as bad as people are saying?
We don’t
want to seem unrealistic. For UK asset managers, working and living in the
Brexit uncertainty isn’t like waiting for a business dream to come true, or
waiting for a new investment product to launch (for example). However, it can
be an opportunity to rethink how they have been operating their asset
management business until now and to plan for a robust European infrastructure.
Brexit, after all, is triggering change. With timely actions and a proactive
mindset, businesses can prepare to make the best out of the most discussed
secession episode of this century (so far).
Relying on politics to see the light at the end of the long, shadowy Brexit tunnel isn’t what we recommend. One’s optimism about the “remain solution” is still valid, but uncertainty will only cause delays. The situation requires you to act as soon as possible, if you haven’t started already. If you want to manage and sell European funds, creating your on-shore presence in Europe is your end solution. This article gives you an overview of how to get started.
Last call: The Brexit Timeline
By Royal Assent, the United Kingdom is set to leave the EU on 29 March 2019 at 11 pm (UK time). Yes, it is that precise! As politicians debate the precise terms and conditions, the prudent in the industry are taking steps to ensure business continuity with minimal disruption. We’ve put together a Brexit timeline that helps you get a clearer idea of the path towards the withdrawal day. As you can see, the process has been anything but easy.
Did you know? A royal assent is the method by which a country’s monarch (possibly through a delegated official) formally approves an act of that nation’s parliament. At the moment, royal assents are merely a formality.
Why Asset Managers should stop focusing on Brexit
As a
UK asset manager, you want to establish viable European operations as soon as
possible to maintain current levels of access to Europe Post-Brexit. European
regulators require demonstrable substance to manage European Funds and to sell
to European investors. For that, operations will need the necessary
accountability structures, skill sets and access to data to perform the tasks
related to oversight and risk and portfolio management.
Meanwhile, the UK Government has a Temporary Permissions Regime (TPR) to minimise disruption for EU firms currently operating in the UK due to the loss of passport rights. The aim is to allow firms to continue to operate in the UK during a limited period of time (three years) while they seek to obtain permanent authorisation or recognition from UK regulators.
Firms need to apply either by notifying the relevant regulator (PRA or FCA) of their intention to enter the regime before 29 March 2019 (exit day), or by submitting an application for authorisation before exit day.
In this video, Matt Moran (PwC Luxembourg) and Robert Mellor (PwC UK) talk about the current political uncertainty revolving around Brexit, the options asset managers have on the table and what to do as of now.
What we think
Robert Mellor, Partner in PwC UK
Stop focusing on Brexit; start thinking about planning for a European infrastructure […] if you want to manage European funds and you want to sell to EU investors. Focus on building out what your European business needs to be. Brexit was just a trigger point for you.
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