Financial Conduct Authority CEO Andrew Bailey has warned that firms making plans before knowing the outcome of Brexit negotiations may find themselves in tricky water.
Bailey highlighted the importance of an agreement on a transition period in terms of Brexit at the regulator’s annual conference on 18 July.
According to Bailey, because the majority of firms have already put their contingency plans for Brexit in place, they might experience difficulties when the terms of the Brexit deal are agreed.
“I do think it [an agreement on a transition period] is important because otherwise firms find themselves in the position where they have to make a plan without knowing what the outcome of the negotiations is,” Bailey stated. “That seems to me to be a difficult situation to be in.”
He added that “there is every reason to have open markets and free trade” after Brexit.
Bailey has also revealed to the FT that the FCA has been shut out from some negotiations with the EU. “There are times when they want to discuss Brexit without us being present, and there are issues they want to discuss amongst themselves, so we have a bit of shuttling in and then shuttling out,” he says.
Last year the British Insurance Brokers’ Association (BIBA) said the FCA has played an important role in the development of the financial services regulations that are applied across Europe. Prior to the Brexit negotiations, BIBA highlighted the importance of having comparable regulatory regimes in order to continue the free flow of business between the European Union and the UK.