The European Banking Authority (EBA) has called on financial institutions to finalise preparations for the end of the transition period between the EU and UK. In a recent press statement, the EBA has reminded financial institutions that with the end of the transition period between the EU and UK on 31 December 2020, the possibility for the UK-based financial institutions to offer financial services to EU customers on a cross-border basis (passporting) will end as well.

As per the European Commission’s Preparedness Notice to stakeholders in the field of Banking and Payment Services, the EBA has outlined the following steps for financial institutions in the UK wishing to operate in the EU:

1. Finalise preparations and effective establishment in the EU as agreed with relevant competent authorities
   Financial institutions wishing to operate in the EU and offer services to their EU customers should ensure they have obtained the necessary authorisations and effectively establish themselves before the end of the transition period.
2. Preparedness of payment and electronic money institutions
   The EBA warns UK-authorised payment and electronic money institutions wishing to continue to offer services to EU-based customers that it is illegal for them to provide payment or electronic money services in the EU after 31 December 2020, unless they have been adequately authorised beforehand by an EU competent authority.
3. Communication to customers
   Financial institutions affected by the UK withdrawal from the EU, should provide adequate information to their EU customers regarding the availability of services after the end of the transition period.