Providers are waiting with bated breath to hear what kind of access the UK will have to the other 27 nations of the European Union (EU27) after March 2019.
While a deal remains elusive, both sides are preparing for a no deal scenario potentially leaving savers in limbo.
According to the European Commission’s paper Preparing for the withdrawal of the United Kingdom from the European Union published last week:
“These passporting rights will cease to exist after withdrawal. This means that the provision of financial services from the United Kingdom to EU27 will be regulated by the third country regimes in EU law and in the national legal frameworks of the respective member state of the EU customers. There will be no single market access.
“Operators in all financial services sectors need to prepare for this scenario if they wish to ensure that there is no disruption in their current business model and that they are in a position to continue serving of their clients.”
It goes on: “In relation to contracts, at this juncture, there does not appear to be an issue of a general nature linked to contract continuity as in principle, even after withdrawal, the performance of existing obligations can continue. However every type of contract needs to be looked at separately.”
A glimmer
Gibraltar-based Nigel Feetham, a partner with Hassans, told International Adviser “there was no reason” these last two lines could not include existing obligations for pensions, insurance and insurance wrapped products.
“Whilst it still obviously requires clarity and confirmation from the European Commission, specifically in relation to insurance contracts, it does offer a glimmer of hope,” he said.
“I suspect there is discussion going on behind the scenes. It is certainly not in anyone’s interest (UK or EU) to be left in a position where claims/pensions cannot continue to be paid post-Brexit.”
