Jim's Guidebook To Spain

You Are Here >>

Jim's Guides

Covering everything from BREXIT, moving to Spain, gaining residency, length of stay rules, healthcare in Spain, banking & insurance, Guidebook Spain is the best source for well maintained, accurate and easy to understand articles on moving to and living in Spain for the ex-pat and for anyone visiting Spain.

Brexit, currency transfers and the law. By Paul.

Print article Email to friend
0.00

As we adjust to life post-Brexit there are many things to consider, but if you need to move money abroad there is one particular change that it’s essential to be aware of.

The free movement of services came to an end at the close of the transition period, with service providers instead having to comply with the different rules of the EU member states in order to operate legally.

Of particular note to people making international money transfers is the fact that UK financial service firms lost their financial services passports on 1st January 2021.

What is a financial services passport?

Before Brexit the ‘passporting’ of financial services meant that firms were able to operate in the European Union (EU) and European Economic Area (EEA) under a UK-based licence.

For example, a company authorised by the Financial Conduct Authority (FCA) in the UK could use this licence to work with customers based in any other country in the EEA.

However, as the UK has now lost these passporting rights, any financial services firm (including currency transfer providers) must have a valid EU licence if they want to continue working with customers in the EU/EEA.


The Royal Decree

On 29th December 2020 the Spanish Royal Decree-Law 38/2020 was published.

This Decree outlines measures for the adaption to the status of a third State of the United Kingdom of Great Britain and Northern Ireland after the end of the transition period.

The Royal Decree came into force on 1st January 2021 and includes a specific section about financial services and how firms from that sector can work with customers based in Spain moving forwards.

According to the Royal Decree:

‘From 1st January 2021, UK authorised entities will be subject to the relevant Spanish legislation and applicable regimes in respect of third country firms. UK entities will have to obtain a new authorisation to operate in Spain.’

The Bank of Spain (Banco de España) is the FX supervisory authority in Spain and can impose penalties on any currency providers who fail to comply with the decree in order to safeguard the interests of customers.

Understanding equivalence

You may have heard some discussions in the media about ‘equivalence’ – whereby the European Commission can open up market access for some UK-based service providers.

The European Commission can grant a country equivalence if it views the country’s laws as being similar in intent and purpose to the laws of the EU, but it can also withdraw equivalence on 30 days’ notice if the situation changes.

While this is good news for some sectors, financial services are subject to different equivalence regimes and the level of access offered is far narrower than passporting permitted.

It should also be noted that equivalence operates in fewer areas, covers fewer services and is less secure than passporting.

International currency transfers are one of the financial services not covered by equivalence, so the provider you use must still have a valid EU licence if you’re going to continue working with them.

What do you need to know?

Any currency transfer provider offering their services to customers based in Spain must be regulated by a relevant EU authority.

If they aren’t licensed appropriately and in accordance with the Royal Decree they cannot renew contracts with existing customers or solicit new customers. They must also have concluded working with existing customers based in Spain by 30th June 2021.

If you’re using a currency transfer specialist to move money to or from Spain and they haven’t sent you any communications regarding a change of licencing post-Brexit, get in touch with them to find out whether or not they have a valid EU licence. This is a simple question and something they should be able to answer instantly.

As mentioned previously, this licence must be with a relevant EU-based regulator, like the Bank of Spain (Banco de España), and your provider should be able to tell you their licence number.

If your provider is only authorised by the FCA they will be unable to continue servicing your requirements from June (and should inform you of that fact) so you will need to find a new currency transfer company in order to ensure the security and continuity of your payments.

When switching providers find a currency company that is licenced to operate in Spain. You may also want to check things like their online reviews, whether or not they’ve won any industry awards and when they were established.
You may find that by moving providers you actually end up working with a company whose customer service and range of products is better suited to your needs, so start looking into your options now.

Residents of Spain choosing a currency exchange company post-Brexit

If you don’t currently have an FX company to work with and you’re a Spanish resident please ensure you only enter into an FX agreement with an EU regulated FX company. As a Spanish resident you won’t be covered by the FCA or Bank of Spain post-Brexit if you enter into a new contract with a non-EU regulated company.

Notes by Jim

This guide was kindly provided to us by the regional sales manager of one of the top FX companies. He didn't ask for his company to be attributed, which I appreciate, as providing an advertising platform for large companies isn't what this website is about.

The information has also been published in a couple of the free newspapers, and a very limited number of other websites, but publishing it on this website should help it to reach a wider audience.

I've looked at Real Decreto-ley 38/2020 in some detail, to try and confirm the detail contained in the guide, and can't fault it. A Real Decreto-ley is only produced if there is an urgent need to pass legislation which can't be delayed for the time it would take to enact normal laws.

The cover of the subject Real Decreto-ley is very wide ranging, and this guide only covers one (but an important one) aspect of it. The scope also includes banking and insurance companies so, as well as checking that your chosen FX company is authorised to act in Spain, it might be advisable to check any UK bank and insurance companies.

Brexit, currency transfers and the law. By Paul.

As we adjust to life post-Brexit there are many things to consider, but if you need to move money abroad there is one particular change that it’s essential to be aware of.

The free movement of services came to an end at the close of the transition period, with service providers instead having to comply with the different rules of the EU member states in order to operate legally.

Of particular note to people making international money transfers is the fact that UK financial service firms lost their financial services passports on 1st January 2021.

What is a financial services passport?

Before Brexit the ‘passporting’ of financial services meant that firms were able to operate in the European Union (EU) and European Economic Area (EEA) under a UK-based licence.

For example, a company authorised by the Financial Conduct Authority (FCA) in the UK could use this licence to work with customers based in any other country in the EEA.

However, as the UK has now lost these passporting rights, any financial services firm (including currency transfer providers) must have a valid EU licence if they want to continue working with customers in the EU/EEA.


The Royal Decree

On 29th December 2020 the Spanish Royal Decree-Law 38/2020 was published.

This Decree outlines measures for the adaption to the status of a third State of the United Kingdom of Great Britain and Northern Ireland after the end of the transition period.

The Royal Decree came into force on 1st January 2021 and includes a specific section about financial services and how firms from that sector can work with customers based in Spain moving forwards.

According to the Royal Decree:

‘From 1st January 2021, UK authorised entities will be subject to the relevant Spanish legislation and applicable regimes in respect of third country firms. UK entities will have to obtain a new authorisation to operate in Spain.’

The Bank of Spain (Banco de España) is the FX supervisory authority in Spain and can impose penalties on any currency providers who fail to comply with the decree in order to safeguard the interests of customers.

Understanding equivalence

You may have heard some discussions in the media about ‘equivalence’ – whereby the European Commission can open up market access for some UK-based service providers.

The European Commission can grant a country equivalence if it views the country’s laws as being similar in intent and purpose to the laws of the EU, but it can also withdraw equivalence on 30 days’ notice if the situation changes.

While this is good news for some sectors, financial services are subject to different equivalence regimes and the level of access offered is far narrower than passporting permitted.

It should also be noted that equivalence operates in fewer areas, covers fewer services and is less secure than passporting.

International currency transfers are one of the financial services not covered by equivalence, so the provider you use must still have a valid EU licence if you’re going to continue working with them.

What do you need to know?

Any currency transfer provider offering their services to customers based in Spain must be regulated by a relevant EU authority.

If they aren’t licensed appropriately and in accordance with the Royal Decree they cannot renew contracts with existing customers or solicit new customers. They must also have concluded working with existing customers based in Spain by 30th June 2021.

If you’re using a currency transfer specialist to move money to or from Spain and they haven’t sent you any communications regarding a change of licencing post-Brexit, get in touch with them to find out whether or not they have a valid EU licence. This is a simple question and something they should be able to answer instantly.

As mentioned previously, this licence must be with a relevant EU-based regulator, like the Bank of Spain (Banco de España), and your provider should be able to tell you their licence number.

If your provider is only authorised by the FCA they will be unable to continue servicing your requirements from June (and should inform you of that fact) so you will need to find a new currency transfer company in order to ensure the security and continuity of your payments.

When switching providers find a currency company that is licenced to operate in Spain. You may also want to check things like their online reviews, whether or not they’ve won any industry awards and when they were established.
You may find that by moving providers you actually end up working with a company whose customer service and range of products is better suited to your needs, so start looking into your options now.

Residents of Spain choosing a currency exchange company post-Brexit

If you don’t currently have an FX company to work with and you’re a Spanish resident please ensure you only enter into an FX agreement with an EU regulated FX company. As a Spanish resident you won’t be covered by the FCA or Bank of Spain post-Brexit if you enter into a new contract with a non-EU regulated company.

Notes by Jim

This guide was kindly provided to us by the regional sales manager of one of the top FX companies. He didn't ask for his company to be attributed, which I appreciate, as providing an advertising platform for large companies isn't what this website is about.

The information has also been published in a couple of the free newspapers, and a very limited number of other websites, but publishing it on this website should help it to reach a wider audience.

I've looked at Real Decreto-ley 38/2020 in some detail, to try and confirm the detail contained in the guide, and can't fault it. A Real Decreto-ley is only produced if there is an urgent need to pass legislation which can't be delayed for the time it would take to enact normal laws.

The cover of the subject Real Decreto-ley is very wide ranging, and this guide only covers one (but an important one) aspect of it. The scope also includes banking and insurance companies so, as well as checking that your chosen FX company is authorised to act in Spain, it might be advisable to check any UK bank and insurance companies.

Disclaimer

While we try to ensure the guides are accurate and up to date, things change and mistakes happen, so please consider this when using the guides.

Jim, the author of the guides, is based on Costa Blanca, and so the articles are biased to that region, although in most cases they are the same or very similar for other areas.

Newsletter Signup

Sign-up for our irregular newsletter and get the latest information on articles, updates and relevant features.

Don't worry: We'll NEVER spam you, and it's easy to unsubscribe late.
I have read and agree to the privacy Policy.
c. v1.21

About Guidebook Spain

Guidebook Spain is the complete guide to living in Spain for the British ex-pat and other foreign nationals.

Painstakingly researched and written by legendary ex-pat Jim Taylor, each article on Guidebook Spain covers vital topics for anyone considering setting up a home in Spain and those who have already made the move.

Jim's takes readily available, often complex, information and breaks it down into easy to read and understand chunks while drawing on his own experience as an ex-pat to add vital "real-world" advice.

Topics Covered Include...

  • BREXIT
  • Residency In Spain
  • The Padron
  • Banking In Spain
  • Healthcare In Spain
  • Insurance In Spain
  • Spanish Income Tax
  • Being a Non-resident In Spain
  • Driving In Spain
  • Buying Property In Spain
  • Spanish Utilities

Privacy Policy

About

Unlike the privacy policy on most websites, this one isn't copied from a generic template; it's been written from scratch by humans who have considered what modern websites do, how most people interact with them and what most people are bothered about when it comes to online personal data.

We've avoided legal jargon and covering every minute detail down to the nth degree. Instead, we've focused on what we consider to be the essential stuff and answering some of the real-world questions you might have.

Overview

We respect your right to privacy and will always do our absolute best to ensure we conform to not just the laws at the time, but also our moral obligation to you. That's why we will never knowingly allow anyone to use any data about you that we hold unless legally required to do so, and we will always keep it secure and (where possible) will remove all trace of it at your request.

We usually only hold names and email addresses you provide us. Still, at times we may keep other identifiable data about you, gathered with your consent, to carry out our day to day business with you. For instance, you might supply us with data as part of an enquiry, or as part of a purchase, or a booking process for a service, etc. In all instances, this data is destroyed once it is no longer relevant or required or held securely if it forms part of a service agreement with you or there is a legal requirement for us to retain. In which case, we can keep data for up to seven years. Like most websites, this site uses cookies (read more about them below) and also like most websites this site may share your IP address (read more about them below) with some online services. By continuing to use the site, you agree to this. We don't do either of these things because we're evil, it's just for a modern website to work the way most people want them to work, you have to! DON'T PANIC though, for the majority of users, you're not directly identifiable by these actions. Big Brother isn't watching!

Cookies

Cookies are tiny files that are added to your computer as you use and interact with websites. They are used mostly for good: To improve your experience, sometimes for bad: Search engines, Social sites etc. may use them to track what a computer (the computer, not the person) is looking at. Many like Google will use them to target you with adverts and for analytics, which results in them being able to build a profile of what you do online. You will get these cookies added to your computer when you land on certain websites, like Google, Youtube, Facebook etc. This site makes use of Cookies, mainly so we can be sure to only show you certain content once, for example, popups or reminders.

Cookies can sound a bit Orwellian and "Big Brother", but mostly they're pretty harmless and unless you land on a website that requests your data and you offer it, the data they hold is mostly anonymous, they don't have your name and email address etc. You can clear out your cookies by clearing your browser history. However, as we said, this site from time to time will use cookies (never for data gathering or advertising). It is generally good practice to install a cookie manager so that you can see what websites install what cookies, as most have them but few admit to it.

Cookies generally fall into three categories: Session, 1st Party Persistent & 3rd Party. A fuller explanation of these is at the bottom of this privacy policy.

IP Address

An IP address is a unique number that identifies your computer on the internet; it is in the form of 111.222.333.444. Lots of services, like YouTube, Facebook, etc., requires that websites send them your IP address before they allow sites to display things like embedded video, or Facebook elements, and so on. In reality, your IP address isn't personal data, as 99% of the time, you can't be identified by it. Regardless, some consider do consider it as such, so to keep ourselves in the clear we've added this bit to our privacy policy: On occasion, your IP address may be shared with some service providers. Emails Emails are typically kept until our inbox is full and we have a clear out and delete or archive all the old ones. We never use addresses obtained from emails for anything other than responding to the emails you send us. We don't harvest these emails for other purposes. Once we clear out our inbox and delete old emails from you, your details are gone.

Newsletter Sign-up

If we have one, our newsletter signup process is distinct from other areas of consent when it comes to your data and uses a double opt-in/2 step verification confirmation that complies with all the latest regulations (GDPR, etc.). It includes a clear indication from you that you wish to be added to our newsletter list. There is no ambiguity in our signup process; you can't sign up by mistake, nor can anyone signup with your email address due to the double opt-in/2 step verification. We record the location, time and place that you signed up. Removing yourself from our newsletter list is easy: Click the unsubscribe link in the newsletters we send or use the Unsubscribe feature on our website.

We don't share our newsletter lists with anyone else, other than the service we employ to send out our newsletters.

Data Protection Officer

If you have any questions about our privacy policy and your data, or would like to know what data we hold about your you can contact us using the details on our regular contact page, making the subject of any emails FAO: Data Protection Officer. We will then forward your email to our DPO who will respond accordingly.

In most circumstances, we will respond within 30 days.

If we suspect any abuses of this requirement (multiple requests in a short space of time etc.), we reserve the right to refuse.

For most requests to be processed, we will need you to provide proof as to who you are and that you have a lawful right to access the data.

Cookies: Further Explained

Session cookies

Session cookies are added to your machine as you surf websites. They are only retained for as long as your browser remains open. They allow a form of memory to exist between your browser and the websites you visit, such as pages visited, shopping cart contents, last viewed items etc. These cookies will remain after you leave the website but will be deleted once you close the browser (fully close it, not hide or minimise it).

1st Party Persistent Cookies

"Persistent cookies" remain on your computer even after you've closed the browser. 1st Party cookies can only relay information back to the website that placed them on your computer. Typically they're used to store site preferences to save you from having to re-enter information on future visits. They may also be used to track your activities (links clicked, pages visited, etc.) while visiting a site. Persistent cookies remain on your computer until you remove them, generally by using the browsers clear history feature, although other methods exist.

3rd Party Persistent Cookies

"Persistent cookies" remain on your computer even after you've closed the browser. 3rd Party cookies are typically used when a website has part of its content delivered via a third party, like embedded videos, maps etc. Sites featuring advertising commonly use 3rd party cookies to deliver the adverts; Overtime 3rd party cookies will build up a profile your online habits (websites viewed, links clicked etc. so they can deliver targeted adds. 3rd party cookies have other purposes too, for more information on this we suggest you search the internet for "what do 3rd party cookies do?". We try to avoid third-party cookies as much as is possible. However, we may, from time to time, utilise third-party content and cannot guarantee that such content does not have third-party cookies delivered with it. Persistent cookies remain on your computer until you remove them, generally by using the browsers clear history feature, although other methods exist.