Wed, May 6, 2020

FCA’s Response to COVID-19 and Brexit

The FCA Executive Director of International, Nausicaa Delfas, delivered a speech at the Deloitte Annual Conduct Risk Conference webinar. 

In response to the COVID-19 pandemic, the FCA has been working with its domestic and international partners to keep markets open and help firms continue to operate, protect consumers and small businesses, and maintain high standards of conduct. The FCA built “financial bridges” to help consumers and small businesses adjust to the impact of the pandemic, by:

  • Supporting users of credit products, who are in increased financial difficulty;
  • Issuing guidance on the Government’s Coronavirus Business Interruption Loan and Bounce Back Loans Schemes; 
  • Warning consumers of the increased risk of scammers;
  • Giving firms more time to publish their annual reports and providing forbearance on best execution reporting;
  • Facilitating equity and debt capital raising, so firms can provide finance to businesses and aid the recovery; and
  • Delaying deadlines for Consultation Papers, such as proposals to enhance climate-related disclosures.


International Work on COVID-19

The FCA has been working with global regulators and central banks to provide clarity, share market development insight, and coordinate responses, including by working with US counterparts to reach common agreement on the implications of coronavirus for LIBOR transition. The FCA published a statement alongside the Bank of England reiterating that firms cannot rely on LIBOR being published after the end of 2021. 

The FCA also published coordinated statements with the Financial Stability Board and the International Organization of Securities Commissions calling for markets to remain open to continue to support businesses, governments, jobs and the economy. 

Global and small businesses will face increased funding and lending challenges as the impact of Coronavirus is felt over time. The FCA remains vigilant to problems in the financial markets and the effect on consumers.

Given the UK’s large global markets and UK firms’ international operations and outsourcing arrangements, the FCA and the UK must address increased vulnerability and disruption from unexpected events.

The UK is a Financial Services hub, which exposes the system to global risks. The FCA, the Bank of England and PRA must stay ahead of evolving risks to ensure ongoing financial stability and market integrity for the global “public good”.

The FCA must focus on areas that will help the global economy to recover, and further advance it. There will be continued regulatory focus on fintech, green finance and operational resilience.


Brexit negotiations are ongoing. The FCA is working with the Treasury and the Bank of England to prepare for a range of scenarios. There are some Brexit risks requiring multilateral or reciprocal action, which the FCA cannot address alone. These fall into two categories:

  • Issues that could be resolved through reciprocal equivalence (such as the overlapping UK and EU share and derivatives trading obligations), and
  • Issues that cannot be resolved through equivalence, including broader contract continuity issues and the provision of retail financial services by UK firms to EU consumers. 

The FCA has called for equivalence assessments to be done on an ‘outcomes basis’, in line with the EU’s stated approach. The UK will have the most equivalent framework to the EU of any country in the world. The FCA continues to advise the UK Government on EU-UK Free-Trade Agreement negotiations and issues related to financial services, and regulatory and supervisory cooperation.

A copy of the full speech is available here.

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