In these FAQs, we set out what Brexit means for Aviva Investors and our clients.
1. What structural changes has Aviva Investors made in preparation for Brexit?
With sizeable operations in Luxembourg, France and Ireland, we already had a substantial presence in continental Europe. We have extended the regulatory permissions of our Luxembourg business, and our European branches will continue to provide investment services as branches of Aviva Investors Luxembourg.
We are expecting the relationship between the UK and the European Union to evolve in the coming months and will continue to monitor the situation to ensure we adopt the optimal approach.
2. What is the operational impact of Brexit on Aviva Investors’ fund ranges?
Due to the work done by the Financial Conduct Authority (FCA) and HM Treasury to minimise market and operational disruption, we do not expect any impact on our UK fund range.
We recognise the relationship the UK has with Europe will continue to evolve following Brexit. However, we have a specialist team who will continue to monitor the situation and we will take the appropriate actions to continue to service our clients and minimise any possible disruption.
3. What will happen to EU funds marketed to UK investors?
Aviva Investors funds domiciled in Luxembourg and Ireland have previously been made available to UK investors using the rights provided by UCITS and AIFMD legislation.
Following the UK’s departure from the EU, and the end of the transition period, the FCA has established a Temporary Permissions Regime (TPR), which allows some of these rights to continue post-Brexit. By notifying the FCA of our intent to continue to allow EU-domiciled funds to be marketed to investors in the UK, the TPR allows non-UK based funds that were previously ‘passported’ into the UK to continue to be sold to UK investors.
We will continue to monitor the regulatory landscape and take appropriate action once any requirements following the end of the TPR have been established.
4. How will Brexit impact Aviva Investors’ ability to source investment opportunities in Europe?
We continue to monitor events and financial markets closely and the risks and opportunities presented by them. Regular stress testing of funds against various scenarios is a core part of our daily investment and risk management process and helps us make informed decisions to protect client portfolios.
The asset management business is global, and Brexit will not impact our ability to continue to source investment opportunities for clients throughout Europe and beyond.
5. What is your position on delegation of portfolio management?
The ability to delegate investment and risk management activities is important to business models across the asset management industry. We believe the current, globally recognised delegation model protects clients’ interests and gives them access to the broadest range of investment opportunities and expertise.
Continued delegation after Brexit depends on co-operation agreements being in place between the UK and EU Member States’ regulatory authorities. We are encouraged that agreement has been reached between UK and EU.
We believe our current organisational structure will allow us to continue to delegate certain key activities to the UK after Brexit, while maintaining appropriate levels of governance and oversight.