Authorisation of EEA banks and insurers

This page provides information for EEA banks and insurers currently operating in the UK via passporting arrangements under various EU Directives that wish to apply for authorisation in the UK as a result of the UK’s decision to leave the EU. 

Introduction

EEA firms operating through a passport in the UK do so either via a Freedom of Establishment (FOE) passport (if they have a branch in the UK), or via a Freedom of Services (FOS) passport (if they do not have a physical presence in the UK). 

EEA firms exercising passport/treaty rights in the UK qualify for authorisation under Schedules 3 and 4 of the Financial Services and Markets Act 2000 (FSMA) and are ‘authorised persons’ for the purposes of FSMA.  

Once passporting rights cease – either at the end of an Implementation Period agreed between the UK and the EU, or in the event of a no-deal exit – EEA firms currently relying on passporting arrangements will require authorisation from the PRA (or for solo-regulated firms, the FCA) to undertake business in the UK.

As the Bank has made clear, EEA firms operating in the UK through passporting arrangements may plan on the assumption that permanent PRA authorisation will only be needed by the end of the Implementation Period which has been agreed in principle as part of the UK’s Withdrawal Agreement with the EU. In the event that the Withdrawal Agreement is not ratified, the temporary permissions regime (TPR) provides confidence that a back-stop will be available. Further information on the TPR is available on the dedicated TPR webpage. In addition, the Financial Services Contracts Regime will provide a further back-stop for the orderly wind-down of UK regulated activities of passporting firms that do not enter the TPR, or that exit the TPR without UK authorisation. Further information is available on the dedicated Financial Services Contracts Regime webpage.

Further information on the authorisation process

If you are an EEA firm that wants to obtain authorisation from the PRA, please note you can apply for authorisation of a UK branch of an EEA firm now, but the branch authorisation can only become effective when passporting arrangements cease to apply. A UK subsidiary of an EEA firm can be authorised now.

Information on the PRA’s approach to branch authorisation and supervision of banks and insurers is available in:

In addition, readers may find it helpful to refer to our key communications on EU withdrawal.

Pre-application process

While it is not required, and EEA firms can apply at any time, we encourage you to engage with the PRA and FCA pre-application process before you submit an application for authorisation (for a third-country branch or a subsidiary). Please get in touch with your usual PRA supervisory contact to arrange a pre-application meeting. If you do not have a named supervisor, please email us at PRA.FirmEnquiries@bankofengland.co.uk or call us on 020 3461 7000 and we will contact the relevant supervisory teams. Our experience has shown that engagement in the pre-application process has clear advantages to all parties. 

 

Application process

You can apply for authorisation by submitting the PRA’s standard application forms on the New firm authorisation webpage which also set out the supporting material required. However, the forms are not specific to branches and there may be some material that is relevant for subsidiaries only. If you are uncertain about what may be required, please discuss this with us during the pre-application stage.  

The basis for the assessment of any authorisation application is determining whether the applicant satisfies, and will continue to satisfy, the PRA’s and the FCA’s Threshold Conditions (TCs). For branches, the assessment of TCs applies to the whole firm and not just the branch.  In order to assess whether a firm satisfies and will continue to satisfy the TCs, we engage with the firm’s Home State Supervisor. 

More information on our authorisation process is available through our joint PRA/FCA dedicated New Bank Start-up Unit and New Insurer Start-up Unit webpages.  Please bear in mind that these pages are targeted at firms that have not previously operated in the UK and may include information not relevant to EEA branch applications, such as use of mobilisation, in the case of banks. For further information on statutory deadlines applying to branch applications by EEA firms, please refer to the TPR webpage on the extension of statutory deadlines. 

This page was last updated 28 February 2019
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