The Danish cross-border licence to continue to offer investment services following Brexit
As will be apparent to everyone these days, Brexit is a moving target. The purpose of this news bulletin is to provide the latest update on the possibility for UK credit institutions and investment firms to apply for a licence to continue offering investment services to Danish clients after a no-deal Brexit.
Credit institutions and investment firms licenced in non-EEA countries can apply to the Danish Financial Supervisory Authority (the "Danish FSA") for a licence to offer investment services and ancillary services to professional clients or eligible counterparties on a cross-border basis into Denmark. The licence is granted pursuant to Section 33 of the Danish Financial Business Act and is not specific to Brexit.
Even though the UK is still a member of the EU, the Danish FSA has indicated that credit institutions and investment firms licenced in the UK may apply for a Section 33 licence ahead of Brexit, and that the Danish FSA will try to process such applications in advance of Brexit in order to avoid a licence gap. The license will only be granted with effect as of the Brexit date, whether it will be on 29 March 2019 or a later date.
Today, the Danish FSA has issued a press release, clarifying that Section 33 licences granted to credit institutions and investment firms licenced in the UK are expected to be temporary licences granted for a period of 12 months from Brexit due to political uncertainty. Accordingly, firms holding such temporary licence will have to apply for a new licence within 12 months from the licence date in order to be able to continue offering the services covered by the licence on a cross-border basis into Denmark.
We recommend that credit institutions or investment firms licenced in the UK which contemplate to continue providing such services under this regime after Brexit apply for a Section 33 licence now. We are of course happy to assist with such applications.
Please note that there is currently no other temporary regime available in Denmark (unlike in certain other EEA Member States).