Status: Please note you should read all Brexit changes to the FCA Handbook and BTS alongside the main FCA transitional directions. Where these directions apply the 'standstill', firms have the choice between complying with the pre-IP completion day rules, or the post-IP completion day rules. To see a full list of Handbook modules affected, please see Annex B to the main FCA transitional directions.

Article 3 Exceptional circumstances

The obligation for investment firms to provide liquidity on a regular and predictable basis laid down in UK law corresponding to Article 17(3)(a) of Directive 2014/65/EU shall not apply in any of the following exceptional circumstances:

  1. (a)

    a situation of extreme volatility triggering volatility mechanisms for the majority of financial instruments or underlyings of financial instruments traded on a trading segment within the trading venue in relation to which the obligation to sign a market making agreement applies;

  2. (b)

    war, industrial action, civil unrest or cyber sabotage;

  3. (c)

    disorderly trading conditions where the maintenance of fair, orderly and transparent execution of trades is compromised, and evidence of any of the following is provided:

    1. (i)

      the performance of the trading venue's system being significantly affected by delays and interruptions;

    2. (ii)

      multiple erroneous orders or transactions;

    3. (iii)

      the capacity of a trading venue to provide services becoming insufficient;

  4. (d)

    where the investment firm's ability to maintain prudent risk management practices is prevented by any of the following:

    1. (i)

      technological issues, including problems with a data feed or other system that is essential to carry out a market making strategy;

    2. (ii)

      risk management issues in relation to regulatory capital, margining and access to clearing,

    3. (iii)

      the inability to hedge a position due to a short selling ban;

  5. (e)

    for non-equity instruments, during the suspension period referred to in Article 9(4) of Regulation (EU) No 600/2014 of the European Parliament and of the Council.