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From the outset, we have had very low expectations of what the financial services industry was going to get either from the Brexit deal with the EU or the much vaunted Brexit dividend of a bonfire of regulation.
We have been providing regular updates on the former, in particular, the notable absence of anything meaningful just as the absence becomes more significant with the advancement of the EU Capital Markets Union. For investment managers, the EU is laying down another roll of barbed wire between us and them from 2nd August when the new rules the Directive and Regulation on the cross-border distribution of funds (CBDF) come into effect.
Our expectations were even lower for the Brexit dividend of a bonfire of regulation. Hopes for tracking down the elusive Brexit dividend were reduced further in February when it was announced that Iain Duncan Smith would be leading the search party. His Task Force on Innovation, Growth and Regulatory Reform (TIGRR) issued its report in May, and is predictably underwhelming. Even before the Task Force had reached its target, the Prime Minister had announced the creation of another crack unit to embark on the same mission.
You can find our further thoughts on all of this here.
Open-ended property funds for retail investors
The problems of open-ended property funds for retail investors in the aftermath of the EU referendum result were highly publicised. Fund suspensions made the 10 o’clock news. Until that point it had been unusual, to say the least, for property funds to appear outside the darker recesses of the Financial Times.
John was appointed by the Association of Real Estate Funds to undertake an independent review of the impact of the referendum result on real estate funds and to evaluate whether any improvements could be made to deal with market shocks in the future. The report was published in April 2017.
The FCA also embarked on a series of consultations, the final denouement of which is still awaited.
You can find our further thoughts on the report and what has transpired since here.