Limits to the operation in Italy of UK banks and investment companies after Brexit

18/02/2021

Starting from 1st January 2021, the provision of banking, financial investment services in Italy by British banks, electronic money institutions, and investment firms shall be deemed to be abusive, unless they have obtained the required authorizations to operate as third-country firms by the competent supervisory authorities. It is worth noting that among such entities, only those that, having submitted a request of authorization as of 31 December 2020, are still waiting for the procedure to be completed, may continue to operate, limited to the management of the existing relations, until they have obtained the authorization, but no later than 30 June 2021. This is also one of the consequences caused in the regulatory field by the Brexit “earthquake”. The withdrawal agreement (aiming at regulating the exit of UK from the EU as provided by article 50(2) TEU in case of withdrawal from the Union by a member State), ratified by the EU and the UK, which entered into force on 1 February 2020, provided for a transition period ending on 31 December 2020. During the “transition” period, the intermediaries have been invited several times by their respective supervisory authorities, including Bank of Italy and Consob, to make suitable plans for an orderly management of Brexit. In particular, the Bank of Italy has issued specific guidelines (Communication April 2020) on the possibility of: continuing to provide services in Italy as third-country operators, by promptly filing the relevant application, also focusing on the strict deadline to obtain it; transferring their activities to another intermediary - either an existing ...