On February 18, the European Securities and Markets Authority (ESMA) published a press release confirming that it has adopted recognition decisions to permit three UK central counterparties (CCPs) to continue to provide CCP services to EU trading venues and EU clearing members following the United Kingdom’s withdrawal from the European Union on March 29 (Exit Day) in the event that no agreement on transitional arrangements is in place with the EU (no-deal Brexit).

The three UK CCPs are:

• LCH Limited;

• ICE Clear Europe Limited; and

• LME Clear Limited.

The formal recognition follows the Bank of England and ESMA’s prior announcements that they had entered into Memorandums of Understanding in relation to CCPs and central securities depositories (CSDs) earlier in February (for more information, see the February 8, 2019 edition of Corporate & Financial Weekly Digest). In relation to CSDs, ESMA states that the recognition assessment for the UK CSD is ongoing and that the results of such assessment will be published soon.

The recognition decisions will, in the event of a no-deal Brexit, take effect on the day after Exit Day.

The press release is available here.