HM Treasury has published a policy statement on the treatment of overseas investment exchanges for the purposes of the U.K. Capital Requirements Regulation. HM Treasury initially proposed to expand the definition of 'recognized exchanges' in the U.K. CRR to include those in the Recognized Overseas Investment Exchange regime and those detailed in the U.K. Prudential Regulation Authority's technical standards that accompany the U.K. CRR definition. Following feedback that these proposals would be insufficient in restoring competitiveness with other jurisdictions (there are 30 exchanges in the ROIE regime compared to the EU's list of 108 exchanges), HM Treasury has amended its proposals. HM Treasury will add the link to the ROIE regime as initially proposed, but rather than refer to the PRA's technical standards, the CRR definition will refer to a set of conditions that will come to be specified in the PRA rulebook for the purpose of identifying recognized exchanges or assets traded on such exchanges. The PRA will therefore formulate new rules for the purposes of identifying recognized exchanges and intends to consult on these as soon as is practicable. Until the rules are made, qualifying exchanges will include those that are domestic U.K. investment exchanges and those in the ROIE regime, once the necessary legislation is made.
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