In the midst of the raft of Brexit related statutory instruments being published by the government in recent weeks, HM Treasury has published a draft version of the Payment Accounts (Amendment) (EU Exit) Regulations 2018. HM Treasury intends to lay the regulations before Parliament in Autumn 2018.
These regulations will amend the Payment Accounts Regulations 2015 (SI 2015/2038) (PARs), which transposed the Payment Accounts Directive (2014/92/EU) (PAD) into UK law, to ensure the PARs operate effectively in the UK in the event of a no-deal Brexit.
The draft regulations:
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transfer responsibility from the EBA to the FCA for implementing technical standards relating to the PAD documents setting out fees and charges (although, at least on day one, the regulations seek to preserve the status quo by providing that documents must comply with the relevant "Commission Implementing Regulations" as amended from time to time, as well as any such technical standards);
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impose an obligation on the FCA to maintain its own list of linked services (which need not follow EU standardised terminology) and to assess this list for updates every 4 years, without reporting to the EBA and the European Commission;
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remove the requirement on payment account providers to facilitate cross-border opening of accounts; and
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limit the scope of the prohibition on discriminating against consumers applying for a bank account so that it prohibits discrimination against consumers resident in the UK (rather than the EU).
UK payment account providers will have discretion whether to continue to offer basic bank accounts to customers legally resident in the EU and whether to offer cash withdrawal or payment transactions outside the UK or in a currency other than sterling on any basic bank account (including basic bank accounts held by UK residents).
The nine UK designated basic bank account providers must continue to offer basic bank accounts to UK residents. Sterling cash withdrawals and sterling transactions on UK basic bank accounts must continue to be free.
The FCA will update its Handbook and relevant binding technical standards to reflect the changes introduced through the Regulations and address any deficiencies as a result of Brexit. The regulator intends to consult on any changes in autumn 2018.
The Payment Systems Regulator will also update its guidance to firms to reflect the changes.
Further SIs impacting the payments sector will be published over the next few weeks – there is still some way to go…..
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