carrying on their business in the Czech Republic on the basis of authorisation granted in the United Kingdom of Great Britain and Northern Ireland in view of the end of the transition period
The Czech National Bank hereby notifies foreign financial institutions other than credit institutions and insurance companies carrying on their business in the Czech Republic on the basis of authorisation granted in the United Kingdom of Great Britain and Northern Ireland (“UK”) including Gibraltar (“institutions concerned”) that after the end of the transition period under Article 126 of the Agreement on the withdrawal of the United Kingdom of Great Britain and Northern Ireland from the European Union and the European Atomic Energy Community (“transition period”), i.e. on 1 January 2021, the authorisation of the institutions concerned to carry on their business in the Czech Republic (under the single European passport) will end.
Unless an agreement on mutual relations between the UK and the European Union includes provisions enabling the continuation of the single European passport for the institutions concerned, or unless the European Commission issues a decision on supervisory and regulatory equality pursuant to the current legislation, after the end of the transition period the institutions concerned will only be authorised to carry on activities in the Czech Republic that are necessary to settle claims and debts arising from contracts concluded before the end of the transition period and to terminate their activities in the Czech Republic, or to obtain authorisation to continue their business under current Czech legislation. The institutions concerned will not be authorised to create new obligations or change the scope of existing ones in any way.
The Czech National Bank expects the institutions concerned to inform individual clients and beneficiaries of the legal consequences of the end of the transition period in respect of their rights and obligations arising from contracts and also of the actions that will be taken by the institutions concerned to settle all claims and debts arising from those contracts. The Czech National Bank also expects the institutions concerned to be able to give evidence of the abovementioned to the Czech National Bank on request.
The Czech National Bank hereby notes that unless the provision of services by the institutions concerned is governed by an agreement on mutual relations between the UK and the European Union, or a decision of the European Commission on supervisory and regulatory equality, further operations of the institutions concerned in the Czech Republic from 1 January 2021 onwards beyond the activities mentioned above will be deemed a breach of the relevant sectoral legal rules, unless the institutions concerned comply with the requirements for carrying on their business under these legal rules. In such case, the institutions concerned will be deleted from the national register of the relevant financial institutions as of the end of the transition period and subsequently will be treated as institutions from third countries.
The Czech National Bank will supervise compliance with duties by the institutions concerned in the Czech Republic (i.e. the prohibition to conclude new contracts and change the scope of existing obligations).