The Financial Services Bill, which will help shape UK financial services regulation in the coming decades following Brexit, received Royal Assent yesterday (29 April).

The bill, now an Act of Parliament, returns nearly all regulatory powers from the EU to the FCA, PRA and other regulators. 

The Treasury says the bill “represents a major milestone in shaping a regulatory framework for UK financial services outside of the EU.”

It will improve the stability and competitiveness of the sector, according to the Government.

Measures in the Act will:

• Strengthen the UK’s prudential standards and promote financial stability by implementing the remaining Basel III standards and a new prudential regime for investment firms giving the FCA powers to oversee an orderly transition away from LIBOR
• Promote openness between the UK and international markets, simplifying the process to market overseas investment funds in the UK and delivering a ministerial commitment to provide long-term access between the UK and Gibraltar for financial services firms
• Maintain an “effective financial services regulatory framework” and sound capital markets with a number of smaller measures, including steps to improve the functioning of the Packaged Retail and Insurance-based Investment Products Regulations (PRIIPs) and increase penalties for market abuse

The new law should help keep the UK “an open and dynamic financial centre, with the highest regulatory standards, and protect people across the UK as they use financial services,” the Government says.

John Glen, Economic Secretary to the Treasury, said: “For the first time in decades, the UK has full control of its own financial services regulation. This Act will protect people who rely on financial services day-to-day and boost the competitiveness of our dynamic global financial centre. It marks a major milestone in our plans to develop a regulatory regime that works for the UK and helps us seize new opportunities in the global economy.”