UK Location Rule – Central Bank of Ireland (CBI) clarification on a No-Deal Brexit basis

In a welcome clarification on 4 February, the CBI published a Notice of Intention on its website in relation to the location requirements for directors and designated persons of Irish fund management and self-managed companies ("ManCos").

The Notice of Intention clarifies that should the UK leave the EU on a no-deal basis, the CBI will consider whether the UK is a country that meets the Effective Supervision Requirement. Currently, half of the directors of a ManCo and half of a ManCo's managerial functions must be performed by at least two designated persons resident in the EEA or such other country as the CBI may, taking into account criteria regarding effective supervision, determine and advise by notice published on its website.

For the period while this is under consideration the CBI does not propose adopting a default position which would treat the UK as not satisfying the above Effective Supervision Requirement. Accordingly, where there is a no-deal Brexit, UK resident directors/designated persons who currently fall within the EEA resident category can remain in situ from 30 March 2019 for the purpose of being counted towards the Effective Supervision Requirement, until such time as the CBI makes its determination.

Further information is available here.