UK’s financial regulator, the Financial Conduct Authority (FCA), which oversees the activities of the financial services providers in the country, issued a statement regarding the shock results of the EU referendum and Britain’s leaving the Union.
According to the FCA, for the time being nothing will change in terms of regulation and supervision, even though much financial regulation currently applicable in the UK derives from EU legislation. “This regulation will remain applicable until any changes are made, which will be a matter for Government and Parliament,” the FCA said and added that the companies must continue to abide by their obligations under UK law, including those derived from EU law and continue with implementation plans for legislation that is still to come into effect.
The FCA also notes that the long term impact of the Brexit vote on the UK financial regulation will depend on the relationship between the UK and the EU in the future.
We remind you that under EU law any forex broker regulated in either EU country, can operate in the UK and vice versa. Among the FCA-regulated brokers are majors such as FXCM, Forex.com, Plus500, CMC Markets, XTB, FXPro, Axi Trader, etc.
Article 50 in the Lisbon Treaty sets the procedure for a country leaving the EU. Under it, a country has a two-year period from the date on which it formally informs the EU that it is leaving, to “disentangle” itself from the Union. Until then it is technically still a member of the EU and all regulation is still applicable.
Even though 51.8% of the Brits voted to leave, the referendum result is not binding and formal decision about leaving must be voted by the British Parliament. It is not clear when will this happen and when Article 50 will be formally activated.