The German Federal Ministry of Finance has published a draft bill seeking to reduce uncertainties facing UK financial services companies in the event of a hard Brexit. The proposed regime allows the German regulator to grant a transitional arrangement until the end of 2020. Under this provisional regime, insurance companies based in the UK are able to terminate existing contracts within a reasonable time frame, or prepare for an orderly run-off.
This step to support companies with their contingency planning comes at a good time given the uncertainty surrounding the Brexit deal, which was signed off by EU leaders yesterday. However, many vital questions remain unanswered and companies are well advised to progress with their post-Brexit planning.
The German government is moving to establish a framework that would allow UK financial services companies to service existing contracts on a temporary basis within Germany in the event of a hard Brexit.