Post-Brexit prudential regime expected to hinder UK competitiveness

Smaller firms at greatest disadvantage

The Financial Conduct Authority's (FCA) proposed post-Brexit prudential regime for MiFID investment firms is set to negatively impact competitiveness, while impacting the attractiveness of the UK in the eyes of investment groups, a new poll suggests.

In June, the regulator published proposals for new prudential rules for UK investment firms, replacing EU rules, and targeting controls on liquidity, remuneration and capital requirements. At the time, the regulator said the "large majority of UK investment firms" would prefer a domestic regime as it provides the potential of "lower regulatory costs, better alignment of requirements to business models, strengthened supervisory dialogue, improved competition and better prudential outcomes". However, while about a third of the UK's 3,844 MiFID investment firms are currently exempt from ...