Onshoring EU Regulatory Technical Standards under the Interchange Fee Regulation
The Treasury has published its Interchange Fee (Amendment) (EU Exit) Regulations 2018: draft statutory instrument (SI).
We are consulting on our proposed amendments to the retained regulatory technical standards regulation (RTS Regulation) adopted under Article 7 of the EU Interchange Fee Regulation for onshoring purposes. These amendments are designed to ensure the RTS Regulation can still operate effectively once the UK has left the EU.
Interchange Fee (Amendment) (EU Exit) Regulations 2018: draft statutory instrument (SI)
This draft SI is part of the wider work the government is doing under the European Union (Withdrawal) Act 2018 (‘EUWA’) to prepare for the UK’s withdrawal from the EU in a range of scenarios, including the scenario where the UK leaves the EU without a withdrawal agreement and implementation period (sometimes referred as a ‘no-deal scenario’). The main purpose of this draft SI is to make amendments to the retained EU Interchange Fee Regulation (IFR) to ensure that it continues to operate effectively once the UK leaves the EU, in a no-deal scenario.
This draft instrument is still in development and is not final. The drafting approach, and other technical aspects of the proposal, may change before the final instrument is laid before Parliament. The changes made in this SI would not take effect on 29 March 2019 if there is a withdrawal agreement and an implementation period is put in place.
The Treasury has set out further information on its approach to financial services legislation under the EUWA.
The Treasury has delegated powers to the PSR to amend the retained regulatory technical standards regulation (RTS Regulation) adopted under Article 7 IFR for onshoring purposes and maintain it in the future (under the Financial Regulators’ Powers (Technical Standards etc.) (Amendment etc.) (EU Exit) Regulations 2018).
We propose to amend the RTS Regulation to ensure that it functions effectively after exit day in a no-deal scenario and that it is consistent with the changes made by the Treasury in the draft SI onshoring the retained IFR.
Why are we consulting on this?
As indicated in our approach to financial services legislation under the EUWA in June, we are consulting on our proposed changes to the RTS Regulation for onshoring purposes. The changes we are proposing address deficiencies in the RTS Regulation which arise from EU withdrawal in a no-deal scenario. We have not made any substantive policy changes.
We are consulting only on the proposed amendments set out in this paper, not on the RTS Regulation for purposes unconnected to EU withdrawal or on the IFR more broadly.
Who should read this document?
We expect this consultation to be of interest to various parties including:
• card schemes subject to Article 7 of the EU IFR
• parties contracting with card schemes and/or processing entities (e.g. issuers, acquirers)
• third-party card payment processors
Please consider our proposals and send us your comments on the questions in this consultation paper by 5pm on 17 December 2018.
You can email us at PSRconsultations@psr.org.uk or write to us at:
Payment Systems Regulator
12 Endeavour Square