1. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar in the EU Post-boxing arrangements

2. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU - Background - Gibraltar is situated at the Southerly tip of the Iberian Peninsula facing the North coast of Africa and controlling the entrance to the Mediterranean. It is small in geographic terms being less than 3 square miles in area and supporting a population of 30,000.

3. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU Gibraltar has been a Crown Colony of the United Kingdom since 1704. Although Gibraltar enjoys a considerable degree of self government concerning its internal affairs, the UK retains overall responsibility for Gibraltar and is directly responsible for issues such as: Defence; Foreign Affairs; and Internal Security

4. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU Under Article 299(4) (ex Article 227) of the Treaty of Rome, which established the European Community, the provisions of the Treaty of Rome are applied throughout the European Territories for whose external relations a Member State is responsible for.

5. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU This means that, by virtue of the UK’s membership of the EU, Gibraltar is part of the EU, including part of the UK’s single market. Gibraltar is not, however, a Member State and the UK remains responsible for EU related affairs with respect to Gibraltar. For the purposes of financial service regulation the Competent Authority for Gibraltar is The Gibraltar Financial Services Commission (GFSC). The GFSC is entirely independent from the UK Financial Services Authority, which is the Competent Authority for financial services regulation in the UK.

6. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU Within the various EU Treaties, Regulations, Directives and Decisions there are provisions for the Competent Authorities of Member States to communicate with each other. Whilst, as the competent authority, the GFSC would normally communicate directly with other competent authorities within the EU, Spanish sovereignty claims over Gibraltar and their consequential non-recognition of Gibraltar institutions required a slightly different process being adopted. Therefore, in respect of Gibraltar, agreement has been reached between the United Kingdom and its EU partners of how this communication between EU competent authorities was going to be undertaken.

7. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU The UK have established the UK Government of Gibraltar Liaison Unit for EU affairs. The unit is otherwise known as the “Post-box” handles and keeps track of all formal communications between Gibraltar competent authorities and their EU/EEA EFTA counterparties, and ensure that information is exchanged smoothly and effectively. Areas covered by the Post-box are, any present or future treaty concluded within the framework of the EU. The post box does not cover other types of correspondence or cooperation between the GFSC and other regulators, including the sharing of information in relation to regulatory enquiries and investigations. These are dealt with directly between the GFSC and the regulator concerned. The post box is not part of, no does it have any link to the UK Financial Services Authority

8. Financial Services Commission, Gibraltar www.fsc.gi Gibraltar’s position in the EU The Post-box does not review the documentation received, it simply establishes a mechanism for passing notifications and decisions between Gibraltar and EU/EEA EFTA competent authorities on treaty issues (for example passporting of firms between one Member State and another). Outgoing documents are drawn up by the Gibraltar Competent Authority, in this scenario the GFSC. They will be addressed to the Member State Competent Authority.

9. Financial Services Commission, Gibraltar www.fsc.gi Post-Box Arrangements Outgoing Documents The GFSC will send the document, by hand, to the Chief Secretary of the Government of Gibraltar (Chief Secretary) at his office at Number 6 Convent Place, Gibraltar. This accompanied by a cover letter and 2 copies of the documents. These need to be placed with the original in an unsealed envelope addressed to the Member State Competent Authority. The Chief Secretary’s Office will then allocate a reference number. One copy will be retained and the original plus second copy are sent to the UK Government Gibraltar Liaison Unit for EU affairs (UKGGLU). Additionally the Chief Secretary’s Office will also send an advanced fax copy of the document to the UKGGLU.

10. Financial Services Commission, Gibraltar www.fsc.gi Outgoing Documents If the Member State Competent Authority acknowledges receipt of the UKGGLU, that acknowledgement will be sent as an Incoming Document to the Chief Secretary’s office. Alternatively if the Member State Competent Authority acknowledges receipt to the GFSC, then the GFSC will inform the Chief Secretary’s office, who will, in turn, advise the UKGGLU by fax. On receipt of the original document the UKGGLU will send a fax to the Chief Secretary’s office acknowledging receipt. The Chief Secretary will then inform the GFSC.

11. Financial Services Commission, Gibraltar www.fsc.gi Outgoing Documents The UKGGLU will retain the copy of the documents and pass the original to the Member State Competent Authority by either: Courier; Diplomatic Bag; or Registered Mail; This will be accompanied by a cover letter. The UKGGLU will fax a copy of the cover letter and method of conveyance of the documents to the Chief Secretary for onward transmission to the GFSC.

12. Financial Services Commission, Gibraltar www.fsc.gi Outgoing documents procedures

13. Financial Services Commission, Gibraltar www.fsc.gi Incoming Documents All incoming documents to the GFSC will be sent via the UKGGLU to the Chief Secretary’s office by private courier with a cover letter. The UKGGLU and the Chief Secretary’s office will each make a copy of incoming documents. An advanced copy of the incoming documents will be faxed by the UKGGLU to the Chief Secretary’s office with a reference tracking number attached to it. The Chief Secretary’s office will then send the incoming document to the GFSC by hand with an attached cover letter. On receipt the FSC will acknowledge the receipt of the original document by faxing the Chief Secretary’s office. Finally the Chief Secretary’s office will send a fax to the UKGGLU acknowledging the safe arrival of the document

14. Financial Services Commission, Gibraltar www.fsc.gi Incoming documents procedures

15. Financial Services Commission, Gibraltar www.fsc.gi Post-Box Contact details for the UKGGLU Scott Strain (Head) Justine Graham (Desk Officer) UKGGLU Room E1.105 EU-Internal (Western Mediterranean Team) Foreign and Commonwealth Office King Charles Street London SW1A 2AH Tel: 00 44 207 008 2273 Tel:00 44 207 008 2972 Fax:00 44 207 008 3629 E-mail:Scott.Strain@fco.gov.uk Justine.Graham@fco.gov.uk

16. Financial Services Commission, Gibraltar www.fsc.gi What the Post Box is not intended for! It is NOT to be used for routine matters of communication or co-operation between Competent Authorities. For example Fit and proper checks of individuals Investigations Consolidated Supervision Issues of Technical Assistance It does NOT apply in issues pertaining to the proper exchange of information between Competent Authorities. Furthermore the Post Box arrangements do NOT impact on any arrangements reached when entering into an MOU with another Competent Authority. Informal communications between Competent Authorities, for example, e-mails, are NOT included in the Post Box arrangements. It does NOT apply to ANY relationships between GFSC and non EU regulators

17. Financial Services Commission, Gibraltar www.fsc.gi Conclusions Post-boxing was introduced as a result of the on-going Spanish sovereignty claims over Gibraltar. It was therefore introduced for political NOT regulatory reasons It is solely used for formal communications between the GFSC and other competent authorities in the EU in relation to Treaty matters (e.g. passporting of banking, insurance and investment services). It has no impact on the “day to day” inter regulatory cooperation between the GFC and other regulators in the EU. These remain direct. All Post-boxing is via the UKGGLU there is no involvement of the UK Financial Services Authority which is entirely independent from the GFSC.

18. Financial Services Commission, Gibraltar www.fsc.gi Post-Box Arrangements End