Europe's markets regulator today became the latest authority to warn firms to prepare for a "hard Brexit", warning firms who wish to relocate to apply for access to the EU now.
The European Securities and Markets Authority (Esma) issued a public statement urging financial services businesses to plan for a scenario in which the UK leaves the EU without agreeing trade terms, warning there is "no assurance that a transition period will be agreed upon".
The Paris-based regulator added that some national authorities within the EU will be unable to process applications in time for Brexit if they are not submitted before the end of July, giving firms wishing to relocate activities less than three weeks to complete their applications.
The UK government plans to reach a deal before it leaves the EU on 29 March 2019, but has not yet secured an agreement with the EU, leaving the possibility that trade could default to World Trade Organization terms.
Financial firms currently rely on the so-called passport for UK-EU trade without having to be authorised in every individual jurisdiction.
Esma's warning follows interventions from the European Banking Authority and the European Insurance and Occupational Pensions Authority, who sparked a row with City regulators by saying firms are holding back investments in contingency plans.
Esma said: "On 30 March 2019, firms must have a fully authorised legal entity located in the EU27 to continue providing services in the EU27."
Firms should submit their applications "as soon as possible", the body said.