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Brexit regulatory resilience - is your business up to date?

By Calum Maclean
Senior Risk Manager

If your business has offices, or clients in Europe, chances are you will have to address some of the specific issues arising from the free-trade deal agreed with the EU on 24th December. 

Three requirements to take note of now

  • You may have to register for VAT in EU countries you are providing services into.
  • UK qualified staff working in Europe will no longer have their qualifications automatically recognised.
  • Depending on the qualification, and the country, some staff may have to sit additional conversion exams.

The situation appears particularly arduous for auditors, who have to be resident in France and Italy and requalify in some other countries.

Data protection and the future

Data protection is as yet an unresolved Brexit issue – with a six month extension during which data flow between the EU and the UK will continue as normal, pending the results of an assessment of UK data protection standards. You should therefore keep alert for any changes, assess how they could impact your business, and have contingency plans in readiness.

Financial probity

The FCA, and other professional regulators, continue to focus on anti money laundering. If you are an FCA-regulated firm, be aware of proposals to extend the obligation to report annually on financial crime to a far wider range of businesses, regardless of their revenue.

Another regulatory measure to improve financial probity, the DAC6 regime, sees its reporting obligations come into force in 2021, after Covid-19 caused the original reporting deadlines to be pushed back. Some of these deadlines - relevant for intermediaries such as solicitors, IFA’s and accountants, are already passed, but others are due this week, and in subsequent weeks.

Make sure that you are up to speed with the requirements. 

• From 30th January (within 30 days beginning on 1st January) for arrangements between 1 July and 31 December 2020
• 28 February 2021 for “look back” arrangements: (for notification of arrangements put in place between June 2018 and end June 2020)
• 30 days from certain trigger points for all arrangements from 1 January 2021

We anticipate regulators taking a tough stance on firms that fail to meet regulatory obligations in 2021. We also anticipate a tough trading environment, and the gradual emergence of a recession-related wave of claims against professional advisers. Take the steps now to ensure that your business is well placed to weather the storm, and to take advantage of the opportunities that the disruptive environment offers.

More information and guidelines from the QBE Financial and Specialty Market Risk Solutions team