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Preparing for a hard Brexit - ten points relevant to mainstream debt capital market issuance

Author
Cresswell Jennifer
Jennifer Cresswell

PSL Counsel

London

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Thomas Amanda
Amanda Thomas

Partner

London

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01 October 2019

The current political landscape means that uncertainty as to the nature of the UK’s withdrawal from the EU continues. It remains a possibility that the UK will leave the EU on 31 October 2019 without a deal – a so-called “no-deal Brexit”. A no-deal Brexit will mean that the UK will not be a Member State of the EU and that Union law will not be applicable in the UK.

In light of this (and as an update to our previous publication dated February 2019), we set out below a high-level discussion of ten points for action and issues for consideration to assist issuers and other participants in the mainstream debt capital markets in preparing for a no-deal Brexit. The UK Government has announced, and UK exit legislation provides for, measures which will address some concerns of issuers accessing UK markets following a no-deal Brexit. We have not seen any similar measures in the areas covered below contemplated by the EU to date. Therefore, our points below focus principally on the impact of a no-deal Brexit on accessing EU27 markets and complying with EU27 regimes post-Brexit. We do not cover in detail the UK domesticated regime post-Brexit, but if you would like general information in relation to the European Union (Withdrawal) Act 2018 and the legislative position in the UK post-Brexit, please refer to other Brexit publications on our website. Finally, while many of the points below will apply equally in relation to covered bond and structured finance transactions in general, there will also be additional points to consider in those contexts which we do not cover in this paper.