Draft U.K. secondary legislation has been published to onshore the EU Short Selling Regulation on the day the U.K. exits the EU. The draft Short Selling (Amendment) (EU Exit) Regulations 2018 (or U.K. SSRs) are expected to be laid before Parliament in Autumn 2018 and to come into force mostly on the day the U.K. withdraws from the EU. The draft U.K. SSRs are made under the provisions of the European Union (Withdrawal) Act 2018 to address failures of retained EU law relating to short selling to operate effectively and other deficiencies arising from Brexit.
The explanatory guide to the U.K. SSRs states that changes for firms with shares admitted to trading on a U.K. venue should be minimal. The procedure for notifying U.K. instruments to the Financial Conduct Authority will be kept and instruments admitted to trading on U.K. venues will continue to have the same restrictions applied to them.
The U.K. SSRs will amend the Financial Services and Markets Act 2000, as well as the EU SSR (incorporated into U.K. law by the European Union (Withdrawal) Act) and level 2 legislation under it for U.K. purposes after Brexit takes effect. Changes made by the draft U.K. SSR include:
As discussed in our previous posts, HM Treasury has also published draft secondary legislation and proposals in other areas, such as a temporary permissions regime for EEA firms, a temporary recognition regime for non-U.K. CCPs and a proposed framework for U.K. settlement finality designation. The U.K. financial services regulators are expected to consult in the autumn on how changes will be made to their rules in these and other areas. Further draft financial services legislation is expected to be published in the lead up to Brexit.
View the draft U.K. SSR.
View the explanatory guidance to the draft U.K. SSR.
View details of the draft regulations establishing a temporary permissions regime.
View details of the temporary recognition regime for non-U.K. CCPs.
View details of the proposed framework for settlement finality designation.
View details of the proposed approach to onshoring EU legislation.
View details of the EU (Withdrawal) Act 2018.