The Financial Conduct Authority (FCA) and Dutch Authority for the Financial Markets (AFM) announced on Wednesday that they have signed an agreement that will see the two regulatory authorities forming a closer partnership if Britain leaves the European Union without a deal.
“We have always had a strong relationship with the Dutch AFM and this agreement strengthens that relationship,” said Andrew Bailey, the FCA’s chief executive officer.
“Given the increasing interconnectedness of financial services markets, having close relationships with other countries’ regulators helps to ensure that we can protect consumers and maintain our oversight of firms and markets.”
The deal between the two regulators will mainly focus on data sharing. But they will also be examining best practices together, training with one another and shift employees between London and the Hague for secondments.
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In a statement, the FCA said that the partnership was due to Brexit. The regulator noted that, with a no-deal Brexit on the cards, many firms have opened subsidiaries in the Netherlands so that they can be they sure they will still be able to do business in the EU.
Thus, the prospective deal between the two regulators will be a way by which they can keep an eye on firms doing business in both countries.
“We are looking forward to working together in this partnership,” said AFM chairman Merel van Vroonhoven. “We see UK financial institutions moving to the Netherlands, especially international regulated markets, other trading platforms and traders.”
“Their choice for the Netherlands will impact our capital markets and trading infrastructure. The closer cooperation with the FCA will put us in a better position to protect investors and capital markets through the sharing of information and expertise to minimise risks.”