A no-deal Brexit scenario is highly likely. Where should you report your trades/transactions?

The countdown to New Year’s Eve is on and Brexit is imminent.  Current discussions between the United Kingdom (UK) leaves the European Union (EU) are not looking positive.  If the UK leaves the EU without an agreement (no-deal Brexit), it is important to ensure transaction reports are submitted to the correct Trade Repository (TR) and/or Approved Reporting Mechanism (ARM). There has been no sign of a Brexit deal yet so at this stage we are preparing for a ‘worst-case scenario’. Regardless of what happens, your National Competent Authority (NCA) will expect you to manage your EMIR, MiFIR and SFTR requirements.

Market Watch 64 is significant as it seeks to clarify the FCA’s expectations for market participants with regard to the impact Brexit will have on transaction reporting. Specifically, the FCA stated:

“…firms and Approved Reporting Mechanisms should comply with the changes to their regulatory obligations by the end of the transition period on 31 December 2020. Firms that are not able to comply fully with the regime immediately following the end of the transition period will need to be able to back-report missing, incomplete or inaccurate transaction reports as soon as possible.”

How do you manage a no-deal Brexit?

To accommodate a no-deal Brexit scenario, many TRs and ARMs have established new entities and obtained registration for a second TR and ARM. Firms such as DTCC and UnaVista now have separate UK-based and EU-based ARMs and TRs to overcome this problem.

Investment firms (and their delegates) will need to ensure they report their trades and transactions to the right place, i.e.:

How should you prepare for this transition?

All investment firms need to start reviewing their current arrangements and ensure they are appropriate in the event of a no-deal Brexit. This may mean setting up a new contract and reporting arrangements with a new TR/ARM which may or may not be related to the one currently being used. Firms using a delegated reporting provider should check that the appropriate arrangements are being made.

A key message from the FCA is that all firms should continue to prepare for all Brexit scenarios given the state of negotiations.

What are the post-Brexit reporting requirements under MiFIR and EMIR like?


In a no-deal Brexit, reporting obligations in the UK will be the same as those under MiFIR/MiFID II as they have been adopted locally by the UK parliament, however over time the UK is likely to make changes and diverge from the European requirements.

However, in the event where an EU investment firm has executed its transactions via a UK branch or vice versa, the entity will have a dual reporting obligation. The FCA made it clear that the branch will no longer be able to discharge the reporting obligations by transmitting orders to the other entities.

The flow chart below shows the reporting line in two scenarios:


Following a no-deal Brexit, the EMIR reports will need to be split by the jurisdiction of the investment firms rather than the location of the its branches. The diagram below illustrates the reporting line in various scenarios:

TRAction keeps you up-to-date

There have been informal negotiations going on between the EU and the UK but the next key EU Council will take place in mid-October.  The UK Prime Minister, Boris Johnson, has said that if no agreement is reached by then, the UK is heading for a no-deal Brexit.

We will keep you updated once we receive more information. If you would like to know more about how TRAction can help you to stay compliant with your EMIR, MiFIR and SFTR reporting obligations, please contact us.

Quinn Perrott

Quinn is co-CEO and founder of TRAction and focuses on assisting clients in Europe, Asia and Australia to meet their regulatory requirements with trade and transaction reporting solutions as well as development of the best execution platform. With a background in IT, Quinn started in the financial markets as IT Manager for City Index. He then co-founded and worked as a General Manager at one of Australia’s largest margin FX and CFD providers. Quinn has provided educational sessions to Australia’s regulatory bodies in relation to operational aspects of derivatives and trading platforms.