Our position on Brexit
On Friday 31 January 2020, the UK ceased to be a member of the EU and entered a transition period during which EU law and regulation will continue to apply during negotiations on a Free Trade Agreement (FTA). The transition will end on 31 December 2020.
While we strongly believe a deal is in the interests of the UK and EU, it remains uncertain what level of agreement will be reached. As part of our Brexit planning we have considered a range of scenarios, including the possibility of a FTA not being in place by the end of the transition period, and put in place arrangements to mitigate any potential disruption for our customers, clients and operations. Crucially, supervisors have confirmed that in all scenarios, asset managers will retain the ability to delegate portfolio management services from the EU to the UK.
It is worth noting that the FTA is not expected to cover financial services substantively and will not provide for a bespoke market access regime for the UK. We have been planning on this basis for some time and specific actions we have taken include:
- Establishing an EU MiFID firm in Dublin, Aberdeen Standard Investments Ireland Limited, to provide portfolio management and distribution services to clients in the EU27. This company is now fully staffed and operational, contracting with a range of EU clients, and we expect the business to expand further over time.
- Restructuring our EU branch network under the new MiFID firm to provide services and support the distribution of Group products.
- Expanding the activities of our Luxembourg-based management company to provide services to an increased number of Irish and Luxembourg domiciled funds.
We will continue to follow developments closely and regularly review the arrangements we have in place, including those for a 'cliff edge' scenario. As a global investment manager we have extensive experience of adapting to regulatory change and working across borders.
Our priority is to ensure we are in the best possible position to provide our customers and clients with continuity of service, regardless of the scope and terms of any FTA which takes effect between the UK and the EU when the transition period comes to an end.
As at October 2020