Is any new EU legislation expected to come into force and effect before the end of the transition period?
The European Commission has issued a proposal for a Directive on countering money laundering by criminal law.
MLD5 is expected to come into force and effect by the end of 2019, so is likely to become part of UK law.
The European Commission has also proposed rules aimed at boosting transparency in order to tackle aggressive cross-border corporate tax avoidance.
Is a new regulator needed, or do additional powers to be given to an existing regulator?
Dependent on what security/law enforcement cooperation provisions remain in force post-withdrawal, relevant UK agencies may need new powers to address any loss of European assistance.
Is there an existing "equivalence" or "recognition" regime for recognising Third Country regulatory regimes?
While laws are set and enforced at a national level, in many cases enforcement will involve cooperation and mutual assistance between authorities in different states. The EU regime on security cooperation facilitates this within the EU.
The position in relation to mutual assistance post-Brexit remains unclear.
Does current UK government policy mean that (subject to the terms of a future trade agreement between the UK and the EU) material changes to regulation or enforcement are likely post-Brexit?
After Brexit, it is unlikely that the UK will choose to lighten regulation, since the UK has been a leader in enacting financial crime regulation.
What should businesses be doing now to prepare for Brexit?
- Now is a good time to review your policies and procedures and consider where revisions may be necessary to comply with existing law.
- Consider MLD5 and whether it may impose additional obligations on your business.
- Keep the position under review, including the progress of proposed EU legislation that may or may not apply in the UK, depending on when it comes into force and effect.