Further delays in the UK’s Brexit negotiations to secure market access between the EU and UK can be seen as a positive for Guernsey’s fund industry.
News earlier this week that the UK and EU have not met their target date of June 30 to secure access to use the well-established AIFMD and UCITS route for fund marketing into Europe came as no surprise to Shaun Robert, Director of International Fund Management (IFM), which provides independent non-EU manager (AIFM) services.
‘Failure to meet the recent deadline is good news for IFM and the funds industry in Guernsey, as we have well-established cooperation agreements in place and are in a much stronger position than the UK, whose future access into Europe is still very much undecided,’ said Shaun.
Guernsey was one of first jurisdictions to be approved by the European Securities and Markets Authority (ESMA) to provide third-country passporting without conditions. The island’s non-EU status and existing cooperation agreements means it will continue to be able to have access to market into Europe via the well-trodden National Private Placement Regimes (NPPR).
In a Hedgeweek article last year, Mr Robert spoke about the potential for Guernsey to benefit from its position. He mentioned then that delays on negotiating the UK’s exit from the EU put Guernsey in a positive position.
‘With Brexit uncertainty in the financial sector both in the UK and the EU expected to continue at least into 2022, opportunities to use the well-established AIFMD and UCITS route for fund marketing into Europe are likely to be lost to UK promoters,’ he said.
‘Given that our current access to market into Europe via NPPR will be unaffected, we see this as an opportunity for Guernsey.’