Regulators are vigilant and ready to intervene if Britain’s full departure from the European Union on Dec. 31 risks creating disorder in markets, Britain’s financial regulator said on Thursday.

Britain has already left the EU. But full access for banks and trading platforms to the bloc only ends on Dec. 31, with only limited cross-border activity being allowed by Brussels to date in derivatives clearing and asset management.

“We are doing our planning as I am sure firms are as well to ensure operationally that the end of transition is a smooth one,” Nausicaa Delfas, head of international at the Financial Conduct Authority, told Reuters.

The FCA will work closely with the finance ministry and the Bank of England.

“With passporting ending… and there is a patchwork of solutions on the EU side, which means that we need to be vigilant to ensure we are prepared and able to address any issues arising over that period,” she added.

Brussels has yet to say if it will grant more access to UK financial firms under its equivalence system that scrutinises whether rules of foreign firms are robust enough.

“Whether there are further decisions on equivalence or not, I think the financial sector is ready, as it were,” Bank of England Governor Andrew Bailey told a European Central Bank panel discussion.

A clash looms over where UK and EU banks can trade derivatives, and the FCA needs to remain vigilant over this, Delfas said.

If Brussels decides not to grant full two-way trading in derivatives, the FCA will set out its own rules in “due course”.

Other “cliff edge” risks being closely scrutinised include how UK financial firms service customers in the EU, such as by having to comply with local laws, she said.

Many banks, insurers and trading platforms based in London have opened hubs in the EU to minimise cross-border disruption.

The FCA will crank up its IT systems at the end of the year when it takes on credit rating agencies and trade reporting bodies based in Britain that were hitherto regulated by an EU watchdog, Delfas said.

Britain and the EU are still locked in talks over a free trade agreement, but financial services market access is being dealt with separately.

“We should not assume, even if a deal is agreed, that it will mitigate outstanding risks in financial services,” Delfas said.

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