imported>Doug Williamson |
imported>Doug Williamson |
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| ''European Union (EU) regulation.''
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| In certain cases the EU may recognise that a non-EU legal, regulatory and/or supervisory regime is 'equivalent' to the corresponding EU framework.
| | Federal Accounting Standards Board. |
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| That recognition, in turn, means authorities in the EU may rely on supervised entities’ compliance with the equivalent non-EU framework, and allow the entity to operate more freely than it might otherwise be able to (without equivalence).
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| This approach is designed to bring benefits to both the EU and third-country financial markets.
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| | | Statement of Financial Accounting Standard issued by the Federal Accounting Standards Board. |
| The significance of the equivalence concept, for UK financial services, is that the UK might choose, post-Brexit, to keep its regulatory regime closely aligned with the EU regime, in order to benefit from the possibility of equivalence.
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| <span style="color:#4B0082">'''''Equivalence recognition unlikely'''''</span>
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| :"In addition to disrupting supply chains, Brexit has caused some fragmentation of banking activity for corporates.
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| :It seems increasingly unlikely that we shall see ‘equivalence’ recognition for UK/EU financial services that were not covered by the Trade & Cooperation Agreement.
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| :Treasurers will want to monitor the expiry dates (some in 2022) of various temporary permissions that came into effect post-Brexit, and to ask their banks whether there may be any implications for corporate clients."
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| :''The Treasurer magazine, Issue 4, 2021, p31 - Treasury in 2022.''
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| <span style="color:#4B0082">'''''Equivalence and passporting'''''</span>
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| :"In brief, equivalence is the willingness of one regulator to accept that another regulator's rules achieve the same regulatory outcomes as their own, and so some element of cross-border activity can be allowed.
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| :Equivalence must be agreed, but is subject to negotiation, market by market.
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| :Passporting is the acceptance that once permitted to trade in one state, a business can trade in another without further compliance requirements."
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| :''The Treasurer magazine, March 2017, p12 - Technical briefing.''
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| == See also == | | == See also == |
| * [[Brexit]] | | * [[FAS]] |
| * [[EU-UK Trade and Cooperation Agreement]] | | * [[Federal Accounting Standards Advisory Board]] |
| * [[European Economic Area]] | | * [[Generally accepted accounting principles]] |
| * [[European Union ]] | | * [[IASB]] |
| * [[Free movement of labour]]
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| * [[Gold-plating]]
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| * [[Harmonisation]]
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| * [[Passporting]]
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| * [[Prudential Regulation Authority]]
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| * [[Schengen Area]]
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| * [[Single Market]]
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| == Other links ==
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| [https://ukandeu.ac.uk/rethinking-uk-financial-services-regulation-after-brexit/ Rethinking UK financial services regulation after Brexit, UK in a Changing Europe, December 2020]
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| [https://www.instituteforgovernment.org.uk/explainers/future-relationship-equivalence UK-EU future relationships: options for equivalence, Institute for Government, February 2020]
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| [[Category:Accounting,_tax_and_regulation]] | | [[Category:Accounting_and_Reporting]] |
| [[Category:The_business_context]]
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