The Brexit transition period is due to end on 31 December 2020. Following this, the UK will no longer benefit from the EU financial services passport regulations. As such, UK firms will no longer be able to distribute their funds in Germany under passporting.
UK firms must now comply with the bilateral third-country marketing notification procedure in the German Capital Investment Code in order to continue distributing their funds in Germany. The notification procedure usually applies to funds provided by third country firms. Under the Withdrawal Agreement, the UK will not be treated as a third country firm until the end of the Brexit transition period.
However, BaFin, the German financial regulator, announced on 19 November 2020 that it will permit UK funds to submit third-country marketing notifications now, in the hope that this will enable continuity of distribution to the benefit of German investors. The announcement was made on the BaFin website in German and an English translation has been published by Eversheds Sutherland.
Laven Brexit Team
Our experts in EU and UK compliance are available to provide the following services:
- Consulting to help to determine the best solution for all types of clients
- Introductions to EEA regulated firms and local counsels where helpful
- Application support in obtaining regulatory status in France or Luxembourg through our EU team
- NPPR registrations under Article 42 AIFMD where this is identified as a solution
- European Representative services under Article 27 GDPR as an associated service which is legally necessary for this context
