SEC “likely” to start registering EU-based firms again

An SEC representative has indicated that the moratorium on registration for UK firms is coming to an end. Peter O’Driscoll, Director of the SEC’s Office of Compliance Inspections and Examinations (OCIE) discussed the issue at the commission’s SEC Regulation Outside the United States conference last week. He said in his speech that “the SEC is likely to begin registering UK firms very shortly”.

The US Securities and Exchange Commission has not registered any EU-based firms as investment advisers since the introduction of GDPR. For two years a large number of asset managers in the UK and across Europe have had their SEC applications put on hold. The SEC’s concern was that GDPR – the EU data protection regulation – would prevent those firms from responding to information requests from the SEC.

Following intensive lobbying from UK trade associations, the UK Information Commissioner’s Office – or ICO – has now provided comfort to the SEC that UK firms can, according to the ICO’s interpretation of GDPR, share any necessary data with the SEC per the GDPR’s public interests derogation for cross-border transfers.

According to Peter O’Driscoll’s speech, the assurance came in a letter from the ICO to the SEC on the application of the GDPR as it relates to the sharing of personal data. This will enable the SEC to start the process to accept and process filings from UK firms to register as investment advisers.

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