The German Federal Government’s bill relating to the Tax Act Accompanying the Brexit (Brexit-Steuerbegleitgesetz) dated 4 January 2019, as amended, provides for the permanent recognition of UK assets as cover assets.
To date, it has been an automatic result of the United Kingdom´s membership in the EU and the EEA that claims secured by mortgages on property located within the UK and by rights equivalent to real property or claims against the UK or UK public bodies or guaranteed by such bodies have been eligible cover assets for purposes of the German Pfandbrief Act (Pfandbriefgesetz). The end of the UK's membership in the EU and the EEA would therefore result in such claims losing their eligibility as cover assets, not only for the purposes of new business, but also with regard to outstanding Pfandbriefe.
The German Federal Government’s bill relating to the Tax Act Accompanying the Brexit (Brexit-Steuerbegleitgesetz) dated 4 January 2019, as amended, provides for the permanent recognition of UK assets as cover assets. In order to enable German Pfandbrief banks to refinance loans via Pfandbriefe covered by assets from the UK in the future, the UK is to be admitted as a third country in the German Pfandbrief Act.
With its publication in the Federal Law Gazette the act will be promulgated and becomes effective 29 March 2019.
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