In the non-binding Political Declaration that accompanied the Withdrawal Agreement, the UK and the EU committed, in relation to their respective financial services regulatory frameworks, to “start assessing equivalence with respect to each other under these frameworks as soon as possible after the United Kingdom's withdrawal from the Union, endeavouring to conclude these assessments before the end of June 2020.”

The end of June deadline has now come and gone, but questions over equivalence remain. What equivalence assessments are possible in relation to prospectuses? And what are the implications for market participants if they are not in place once the Implementation Period expires?

In our briefing we explain

  • the circumstances in which prospectus passporting is currently used;
  • that the EU has already confirmed that it will not grant equivalence to the UK's prospectus regime;
  • that the UK has already confirmed that it will grant equivalence to the EU's prospectus regime (though there are some open questions over how this will work in practice); and
  • that provided "inwards equivalence" can be made to work, market participants should not need "outwards equivalence".

The briefing also looks at accounting standards equivalence for the purposes of both periodic financial reporting and the inclusion of historical financial information in a prospectus.