AIMA advises on UK Brexit deal 09 April 2018London Reporter: Madeleine Saghir
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The UK should seek a deal with the EU that ensures UK firms’ relationship with EU investors and clients can continue uninterrupted by virtue of “grandfathering positions”, according to a position paper from the Alternative Investment Management Association (AIMA).
The ‘Brexit and Alternative Asset Managers: Managing the Impact’ paper, published on 9 April, offered a detailed assessment of what needs to be addressed during the transition period between the UK and the EU.
The paper based its analysis on the assumption that the UK will leave the EU’S single market, and that many existing cross-border provisions in EU legislation will cease to apply for UK firms.
A series of technical points that need to be addressed during the transition period are outlined in the paper, with the aim of ensuring a smooth journey for firms as they revise their approach to reflect the UK’s new “third-country” status.
AIMA suggested that addressing these points will minimise disruption for UK fund managers and EU investors when the UK leaves the EU.
The paper also encouraged the UK to establish cooperation agreements with regulators across the EU.
It recommended that the UK should seek a Brexit deal that incorporates an “equivalence” determination in respect of UK rules by the European Commission. This would enable UK firms, clearing, or trading infrastructure providers to continue to provide services to EU clients.
The new position paper is built upon a 2016 paper, ‘Brexit and Beyond’, which was produced by both the AIMA and the US-based Managed Funds Association.
‘Brexit and Beyond’ recommended that an overarching financial services agreement should be made between the UK and the EU based upon principles of equivalence, reciprocity, and non-discrimination.
AIMA CEO Jack Inglis, said: “This is a time of uncertainty for the UK’s alternative investment management industry, and our members continue to devise and implement a variety of contingency plans.”
Inglis added: “With this paper, we hope to set out the clear steps that policymakers and regulators need to take to smooth the path to the new regime and prevent disruption to the UK industry and the clients and investors that it serves in the EU. Our next piece of work in this area will be a similar paper considering these issues from the point of view of European policymakers and managers.”
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