Information on Brexit and investments

Whether or not you will still be able to invest in financial instruments registered/listed in the United Kingdom after a ‘no-deal’ Brexit depends on whether the trade in these instruments still complies with the rules in force in the EU after a no-deal Brexit. The answer to this question can differ per instrument. Generally speaking, based on European Mifid II regulations, certain instruments may be traded only on trading platforms authorised for that purpose. After a no-deal Brexit, British trading platforms would be defined as ‘third-country platforms’, for which such authorisation is not necessarily immediately available.

The Brexit could have consequences for certain investments in investment funds if no additional agreements are entered into with the UK. There might also be potential consequences for dual-listed shares, shares quoted on several exchanges. The questions below are based on the assumption of a no-deal hard Brexit.

Frequently Asked Questions

We wish to inform you regarding the following investment funds:

  • UCITS (see the description below) registered in the UK and UCITS of which the fund manager is registered in the UK (UK UCITS);
  • AIFs (see the description below) of which the fund manager is registered in the UK (UK AIFs).

After the Brexit, these investment funds may be offered for sale in the EU only if certain rules are complied with. An overview of these investment funds is attached.

UCITS may be registered only in the EU. After the Brexit, the UK will no longer be a member state of the EU. If you have purchased a UK UCITS, the status of the investment fund will change as it will no longer be a UCITS. The investment fund then no longer has to comply with European rules for UCITS, and there will also no longer be any relevant checks in that regard. We wish you to be aware of this so that you can decide for yourself whether you wish to continue investing in this investment fund.

At present, it is not yet known which investment funds will still take actions in order to comply with the regulations. 

In addition, it is also possible that the Netherlands will implement temporary measures in order to limit the negative consequences of the Brexit for investment funds. Luxemburg, for example, is already moving in that direction. 

Investors who have these investment funds in their investment portfolio do not have to sell these investment funds before or after the Brexit. Investors can simply continue to hold these investment funds in their investment portfolio.

If an investment fund may not be offered for sale on the Dutch market due to non-compliance with the regulations, we may no longer carry out any purchase transactions for that investment fund on your behalf.

If an investment fund, in which we invest in Portfolio Management, may not be bought in the Netherlands due to the Brexit we will sell this fund. We will do this because we always want to have the flexibility to add a position in an existing fund, which will be impossible if a fund is not registred to be bought in the Netherlands .

If an investment fund may not be offered for sale on the Dutch market due to non-compliance with the regulations, we may still carry out sales transactions for that investment fund on your behalf.

It is not known what effect the Brexit will have on the prices of these investment funds or how the Brexit will affect the ability to sell these investment funds. Take this into account in preparing for the Brexit.

UCITS is an acronym for Undertakings for Collective Investment in Transferable Securities. The UCITS regulations describes the requirements that an investment fund registered in the EU must comply with in order to be offered for sale in all EU countries. In the Netherlands, UCITS is also referred to as ICBE (‘Instelling voor Collectieve Beleggingen in Effecten’).

AIF stands for Alternative Investment Fund. Examples of AIFs are hedge funds or private equity funds. These types of investment funds must comply with different rules and regulations than UCITS.

A dual-listed share can be traded on more than one exchange. Well-known examples of such shares include Vodafone, Glaxo Smith Kline and Royal Dutch Shell. Based on relevant legislation, we are required to trade dual-listed shares on an exchange in the EU. Some exchanges outside the EU are treated in the same way as exchanges in the EU. These exchanges have been declared to be equivalent. After the Brexit, the UK will no longer belong to the EU, and we will therefore no longer be allowed to trade certain (see hereafter) dual-listed shares on the exchange in the UK. This would be permitted only if the exchange in the UK were to be declared as being equivalent. It is not yet known whether or when this will happen. An overview of the shares in question is attached.

After the Brexit, we will be allowed to simply continue trading shares in the UK if they are only traded on an exchange in the UK.  

UK DL Shares

What does this mean in your specific case?

If you have shares in your investment portfolio that are on the list above, we may have purchased these shares for you on the UK stock exchange. If you want to sell these shares after Brexit, we can no longer do that on the UK stock exchange.

You can place an order via Internet Banking, Mobile Banking and MyDealingroom. Before you confirm this order you will see to which exchange we will send this order. If the London Stock Exchange is mentioned here, then the share is bought on this stock exchange. The order will not be executed until you confirm. You can also contact your adviser.

You can, as you are used to, until the stock exchange in London is closed on the day before the Brexit.

If you want to sell your shares from the list above, we can offer you the following solution. We can "move" the shares for you t the other stock exchange. This takes between 1 and 6 weeks, but we are dependent on other parties. During the move you cannot sell the shares in question, which means that you run a price risk from the moment you decide to move the shares until the moment that this has been completed. There is also a risk that the share will trade less liquid on the other stock exchange than on the stock exchange in the UK. This is particularly the case with shares of companies from the UK. For these companies, the London stock exchange is the main listing and the other stock exchange is a second choice. If there is less trading liquidity in a share you run the risk of receiving a lower price for your share on sale.

Do you want to move the shares? Then we will charge you treatment costs for this. These costs will amount to 400 euros per listed company.

If you want to use this solution, you can, but it does take time and money and you run a price and liquidity risk. To move your shares, you can contact your adviser or our contact center on 0900-0024. You can also complete and send this form.

At this moment there is still a possibility that the Brexit will be postponed. You can also choose to await developments around Brexit. Even after Brexit you can choose to have your shares moved to a different stock exchange.

Shares that are only traded on the stock exchange in the UK or that do not appear on the list above, may we continue to trade in the UK after the Brexit.

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