Financial market infrastructure supervision: who regulates UK CCPs, exchanges and CSDs
In short: Financial market infrastructure supervision in the UK is split by statute. Section 285A of the Financial Services and Markets Act 2000 makes the FCA the appropriate regulator for recognised investment exchanges and the Bank of England the appropriate regulator for central counterparties and central securities depositories. A Schedule 17A memorandum of understanding, reviewed annually, coordinates the two; the review published on 5 June 2026 confirmed the dual-supervisor model is staying.
Any firm that trades, clears or settles through UK market infrastructure deals with two regulators at once. The exchange it trades on answers to the FCA. The clearing house and the securities depository behind that trade answer to the Bank of England. The split is deliberate; it follows the statutory objective rather than the entity. A memorandum of understanding holds the boundary in place. On 5 June 2026 the two regulators published their annual review of that memorandum, confirming the arrangements remain effective and naming the workstreams where regulatory coordination matters most this year.
Who is responsible for financial market infrastructure supervision?
Financial market infrastructure supervision divides between the FCA and the Bank of England under section 285A of the Financial Services and Markets Act 2000 (FSMA 2000). The FCA is the appropriate regulator for recognised investment exchanges. The Bank of England is the appropriate regulator for recognised clearing houses, which include recognised central counterparties, and for recognised CSDs. The FCA regulates trading and conduct; the Bank supervises the post-trade systems that clear and settle what is traded, in support of its financial stability objective.
The Bank also oversees recognised payment systems, but under a different statute, Part 5 of the Banking Act 2009, and under a separate memorandum involving four authorities. That distinction matters and is covered below.
| Infrastructure | Appropriate regulator | Statutory basis | What the regulator does |
|---|---|---|---|
| Recognised investment exchanges | FCA | FSMA 2000 Part 18, s 285A(1) | Recognition, supervision of organised markets and the conduct of participants |
| Recognised central counterparties | Bank of England | FSMA 2000 s 285A(2); rules under s 300F | Systemic and prudential supervision; writes the FMI rulebook |
| Recognised CSDs | Bank of England | FSMA 2000 s 285A(2); rules under s 300F | Systemic and prudential supervision of settlement |
| Recognised payment systems | Bank of England | Banking Act 2009 Part 5 | Oversight under a separate four-party memorandum with the FCA, PSR and PRA |
What does the Bank of England and FCA MoU require?
The memorandum of understanding is a statutory requirement. Paragraph 1 of Schedule 17A to FSMA 2000, inserted by section 29(2) of the Financial Services Act 2012, requires the two appropriate regulators to prepare and maintain a memorandum describing how they intend to work together in exercising their functions in relation to recognised bodies. Paragraph 3 requires them to review it at least once in each calendar year. Paragraphs 4 to 6 require a copy to go to HM Treasury, to be laid before Parliament, and to be published.
The current MoU, which replaced the 2023 version, sets out the machinery: information exchange between the regulators, consultation before either withdraws recognition, issues directions, waives rules or acts on a change of control, coordination of information-gathering and investigations under Part 11 of FSMA 2000, and consultation before either directs a qualifying parent undertaking that sits above both an exchange and a clearing house. Where a single group contains both an FCA-supervised trading venue and a Bank-supervised clearing or settlement system, the regulators commit to exchanging supervisory findings and to consulting before enforcement steps.
The annual review incorporates a formal feedback mechanism. The regulators wrote to the supervised CCPs, RIEs and recognised CSDs about their interactions during 2025. Respondents reported a high degree of coordination across policy and supervisory matters, and the regulators concluded that the arrangements remain effective with no material duplication.
How is FSMA 2023 changing the rules for CCPs and CSDs?
The Financial Services and Markets Act 2023 (FSMA 2023) gave the Bank of England a general rulemaking power over central counterparties and central securities depositories. Section 300F of FSMA 2000, inserted by section 9(2) of FSMA 2023 and in force since 1 January 2024, lets the Bank make rules for recognised CCPs, recognised CSDs and, subject to safeguards, third-country CCPs and CSDs, where necessary or expedient to advance its financial stability objective. The Bank is using that power to build an FMI rulebook in place of assimilated EU law.
The main vehicle is the UK EMIR review. In July 2025 the Bank consulted on restating the CCP-facing requirements of UK EMIR in its own rulebook, with the consultation closing on 18 November 2025, and HM Treasury published a policy note and draft regulations to revoke the corresponding UK EMIR provisions when the Bank’s rules take effect. The result will be a UK regime where the detailed requirements on clearing houses sit in the Bank’s rulebook rather than in retained EU regulation. The MoU requires the Bank to notify the FCA when it uses these rulemaking powers where relevant, and both regulators must consult each other on policy work that materially affects the other’s objectives.
What the 5 June 2026 review means for financial market infrastructure supervision
The 2026 statement confirms the dual supervision model is staying, and it names the live workstreams where financial market infrastructure supervision requires the two regulators to move together.
The UK EMIR review is the deepest structural change: it will reset the rulebook CCPs follow, as set out above. Incident and outsourcing reporting comes next on the calendar. The Bank published its final IOREP policy for FMIs on 18 March 2026, developed jointly with the FCA and the PRA. The reporting rules take effect on 18 March 2027, and a linked consultation on revoking a duplicative 2018 incident-reporting rule for CCPs closes on 18 June 2026.
T+1 settlement applies across every layer of the infrastructure at once. The government published a draft statutory instrument on 20 November 2025 making T+1 the standard settlement cycle in the UK from 11 October 2027, a deadline that binds exchanges, CCPs and CSDs simultaneously. The innovation work is shared by design: the Digital Securities Sandbox, established by the Financial Services and Markets Act 2023 (Digital Securities Sandbox) Regulations 2023, is run jointly by the Bank and the FCA, and the statement records tokenisation as a shared priority.
Where do payment systems fit?
Payment systems sit outside this MoU. The Bank oversees recognised payment systems under Part 5 of the Banking Act 2009, and a separate memorandum between the Bank, the FCA, the Payment Systems Regulator and the PRA covers cooperation on payment systems under Part 5 of the Financial Services (Banking Reform) Act 2013. Before the Bank acts against a payment system operator that is FCA-authorised, it must consult the FCA, which can effectively pause Bank action by confirming it is considering action of its own.
Parliament is consolidating the payments side of that architecture. The Financial Services and Markets Bill 2026 provides for the abolition of the PSR and the transfer of its functions to the FCA, completing the direction HM Treasury set in its streamlined payment systems regulation consultation. For securities infrastructure, by contrast, the regulators have kept two supervisors and invested in the coordination machinery instead. The same dual-supervisor pattern appears in the UK’s dual-track stablecoin regime, where the Bank takes systemic stablecoins and the FCA takes the rest. The entry-point questions for firms assessing which regime applies are set out in the regulatory perimeter and market entry guide.
Frequently asked questions
Who carries out financial market infrastructure supervision in the UK?
Two regulators share financial market infrastructure supervision. Under section 285A of FSMA 2000 the FCA is the appropriate regulator for recognised investment exchanges, and the Bank of England is the appropriate regulator for recognised central counterparties and recognised CSDs. The Bank also oversees recognised payment systems under Part 5 of the Banking Act 2009.
Does the FCA regulate clearing houses?
No. The Bank of England is the appropriate regulator for recognised clearing houses, including recognised central counterparties. The FCA’s role is consultative: the MoU requires the Bank to consult the FCA on issues in post-trade systems that are materially relevant to the FCA’s responsibilities for trading platforms and market integrity.
How often must the Bank and FCA review their MoU?
At least once in each calendar year, under paragraph 3 of Schedule 17A to FSMA 2000. The review includes feedback from the supervised firms. The current MoU must also be given to HM Treasury, laid before Parliament and published.
What is changing for CCPs in 2026 and 2027?
The Bank is restating UK EMIR requirements for central counterparties in its own FMI rulebook, following its July 2025 consultation. Separately, IOREP incident and outsourcing reporting rules take effect on 18 March 2027, and T+1 settlement becomes the UK standard from 11 October 2027 under the draft statutory instrument published on 20 November 2025.
For advice on financial market infrastructure supervision, payment systems regulation or the UK EMIR transition, contact Rob Bratby at Bratby Law.
