Financial Services (Implementation of Legislation) Bill [HL]

Key Points

• Allows reference to EU financial services legislation adopted by or before exit day (or within two years after) to operate as retained UK law.
• Defines how adjustments to retained EU law can be made to remedy Brexit-induced deficiencies while avoiding major new policy changes.
• Introduces a four–period, six-month reporting framework for retained rules starting after exit day (with drafting and laying requirements for regulations).
• Inserts references to EU sustainable investment proposals (via Schedule 1) to align UK rules with sustainability standards.
• Consideration of sunset provisions (regulations expiring after four years) and increased parliamentary/regulatory oversight (Treasury and Bank of England involvement, transparency requirements).
• Amendments during consideration sought to constrain changes to only preserve equivalence with the EU, require more detail on transposed provisions, and improve scrutiny; many Liberal Democrat and Labour proposals were withdrawn or not moved, while some Conservative amendments were agreed in the Report Stage.

Progress

The bill is currently at Report Stage in the House of Commons. It originated in the Lords and passed there with amendments; the Commons has accepted some amendments (notably on sustainability references and the reporting framework) and is continuing its examination of the bill before finalising the text.

Voting

Two key votes are recorded. In 2019 the Lords gave the bill a favorable Second Reading (Aye over No). In 2021 the Commons voted to disagree with a Lords amendment, indicating government and its allies supported the main approach while opposition parties largely opposed. Across party lines, Conservatives and their allies backed the bill; Labour, Liberal Democrats, SNP, Plaid Cymru and others generally opposed or criticised certain provisions.