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<p>The Equivalence Directions made with respect to EU-adopted International Financial
Reporting Standards (EU IFRS) deliver a commitment made by HM Treasury in November
2018. In the explanatory information for the Draft Official Listing of Securities,
Prospectus and Transparency (Amendment) (EU Exit) Regulations 2019, published in November
2018, HM Treasury signalled its intention, in a no-deal scenario, to issue an equivalence
decision with respect to EU IFRS in time for Exit day. This will ensure that issuers
of securities in European Economic Area (EEA) states can continue to use EU IFRS to
prepare financial statements for Transparency Directive requirements, and for the
purposes of preparing a prospectus under the Prospectus Directive.</p><p> </p><p>HM
Treasury and the EU have decided to provide exemptions for central banks and certain
public bodies under specific financial services regulations in the event that the
UK withdraws from the EU without an agreement. This decision, in the Exemption Directions
made with respect to EU bodies, was taken as a result of an exchange of letters between
HM Treasury and the EU Commission specifically on this matter in January 2019.</p><p>
</p><p>HM Treasury and the EEA European Free Trade Association (EEA EFTA) countries
of Norway, Iceland and Liechtenstein have decided to provide exemptions for central
banks and certain public bodies under specific financial services regulations in the
event that the UK withdraws from the EU without an agreement. This decision, in the
Exemption Directions made with respect to EEA bodies, was taken as a result of an
exchange of letters between HM Treasury and the EEA EFTA countries specifically on
this matter in April 2019.</p><p> </p><p>Both sets of exemptions are important for
avoiding disruption to the financial services sector, and the businesses and individuals
relying on it, in the event that the United Kingdom withdraws from the European Union
without an agreement.</p>
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