Governmental Oversight or Control
Unleashing the FCA's Global ReachHow Brexit triggered the Financial Conduct Authority's international expansion
In an unprecedented move, the UK's Financial Conduct Authority (FCA) is planning to spread its wings abroad. But why's this sudden change of scenery?
By Rory Doyle
23rd April 2025
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The UK's financial guardian dog, the FCA, is setting sail for foreign shores. But what's the reasoning behind this unlikely journey?
Following Brexit, the FCA sought to expand its global influence by establishing overseas outposts. Here's why:
- Fostering Cross-Border Collaboration: Post-Brexit, the UK faces a growing mismatch with EU regulations, particularly in areas like anti-money laundering and counter-terrorist financing (AML/CTF). To tackle the compliance complexities arising from these divergences, the FCA must engage in continuous dialogue and collaboration across borders to maintain effective oversight[1].
- Strengthening International Relationships: Pursuing partnerships with financial regulatory authorities outside the EU enables the UK to reinforce its regulatory ties with non-EU countries, such as the United States and Commonwealth nations. Setting up offices abroad can facilitate mutual evaluation processes, information sharing, and cooperation to combat global financial crime and protect market integrity[1].
- Promoting UK Regulatory Autonomy and Competitiveness: Independence, flexibility, and growth have become key pillars of the UK's financial regulatory framework post-Brexit. Establishing a presence abroad allows the FCA to supervise UK financial firms operating globally, shape international regulatory standards, and highlight the British approach that caters to its unique needs, encouraging competitiveness and innovation in financial services[5].
In a nutshell, the FCA's decision to venture abroad is driven by the need to evolve in a post-Brexit landscape that calls for intensified global cooperation, oversight opportunities beyond UK borders, and backing for a one-of-a-kind British financial regulatory strategy geared towards boosting competitiveness and fostering innovation[1][5].
The Financial Conduct Authority (FCA), seeking to adapt in a post-Brexit world, aims to promote token-based financial businesses by establishing overseas outposts, fostering dialogue and collaboration with foreign regulators to ensure compliance with AML/CTF and similar regulations. This strategic expansion also serves to strengthen international relationships and showcase the UK's regulatory autonomy and competitiveness in the global finance market.
