The uk-eu relationship in financial services

The relationship between the regulators
The FCA and the PRA were both established in 2013 after the Financial 
Services Authority (FSA) was disbanded, with its functions split between the 
FCA and the PRA. The two are separate entities but work together on certain 
issues. An MoU between the FCA and the Bank of England, including the 
PRA, sets out the different mandates of the two regulators. Under this MoU, 
the FCA is responsible for regulation of organised financial markets and the 
conduct of participants in relation to financial instruments and derivative 
contracts. The Bank is responsible for the oversight of clearing, settlement, and 
payment systems in support of its financial stability objective, and the PRA is 
responsible for the prudential supervision of many of the firms that participate 
in said systems.
The Future Regulatory Framework Review
142. The Government’s proposals for adapting the UK’s regulatory framework 
for financial services outside the EU are set out in the Future Regulatory 
Framework (FRF) review, published in November 2021.
143. The FRF forms the regulatory dimension of the plans for the financial 
services sector articulated in the Chancellor’s July 2021 Mansion House 
speech and related paper, 
A new chapter for financial services
. There are a 
number of proposals contained within the FRF but the overall aim is “to 
achieve an agile and coherent approach to financial services regulation 
in the UK, with appropriate democratic policy input to support a stable, 
innovative and world leading financial services sector”.
185
To achieve this, 
the Government intends to transpose large parts of the financial services 
regulatory framework from legislation to the regulators’ own rulebooks. The 
first consultation on the proposals closed in February 2021 and a second 
consultation closed in February 2022.
144.