HM Treasury has finalised the framework it will use to recognise other jurisdictions’ financial rules as effectively equivalent to the UK’s. The Financial Services (Overseas Recognition Regime Designations) Regulations 2025 were made on 30 October 2025 and take effect on 28 November 2025 across England, Wales, Scotland and Northern Ireland. The statutory instrument is published on legislation.gov.uk.

In practical terms, an “overseas recognition regime designation” is a formal decision by the Treasury that another country, territory or international organisation’s rules in a defined area of financial services either match, or have the same effect as, UK standards. The text is explicit that “territory” includes the European Union, allowing decisions to apply to blocs as well as individual countries.

For firms, the important feature is flexibility. The Treasury can impose conditions, limit a designation to certain activities, and later vary or revoke it. That keeps risk controls tight but means cross‑border models built on recognition need contingency planning in case terms change or access is narrowed.

The information pipeline is also clearer. The Treasury may require the Financial Conduct Authority, the Prudential Regulation Authority and the Bank of England to provide advice or data it considers necessary before making, amending or revoking a designation. The four bodies must coordinate and publish a memorandum describing how they will work together; the Treasury must lay this before Parliament and make it public.

On confidentiality, the instrument adapts how sections 348 to 350 and 352 of the Financial Services and Markets Act 2000 apply so the Bank of England can handle and share information for recognition decisions on a firm legal footing. For market infrastructures that deal closely with the Bank, that removes doubt over what can be disclosed to the Treasury and when.

Two tidy drafting changes align terminology across rulebooks. The insurance prudential regulations drop the words “or Gibraltar” from the definition of an overseas jurisdiction, and the Short Selling Regulations 2025 replace “jurisdiction other than” with “territory outside” while spelling out that “territory” includes the EU and other international organisations. The aim is consistent language wherever overseas recognition is used.

This sits within the FSMA 2023 programme. The new rules restate, with modifications, the 2019 EU Exit instrument on equivalence determinations, which FSMA 2023 has now revoked. Policy continuity matters here: ministers retain the option to recognise outcomes achieved abroad without copying line‑by‑line rules.

What changes on day one? Not market access by itself. The framework becomes operational on 28 November 2025, but specific Treasury designations are still needed to unlock recognition in areas such as trading venue access, insurance prudential treatment or short selling reporting. Compliance teams should map where business depends on recognition and identify units most exposed to any change, suspension or withdrawal.

For investors, the effects run through costs and choice. Recognition can reduce duplicate reporting or capital charges, broadening where UK funds trade, clear and report. But because the Treasury can attach conditions and revisit decisions, portfolios with heavy cross‑border operational plumbing should build in time buffers and avoid assuming any designation is permanent.

The instrument is signed by Lilian Greenwood and Stephen Morgan as Treasury Commissioners. A full impact assessment was not produced, with no significant effect expected on the private, voluntary or public sector. We will watch for the first memorandum from the Treasury, FCA, PRA and Bank of England-and for the initial designations that will show where cross‑border access genuinely eases.