Brexit Forces Interactive Brokers to Transfer its Eastern European Clients to Hungary

The leading online brokerage platform Interactive Brokers has recently asked its customers in East Europe to transfer their accounts to Interactive Brokers Central Europe Zrt (IBCE), the newly formed Hungarian subsidiary of the broker, due to the impact of Brexit on its business.

As the expiration of the transition period for Brexit is approaching, the broker is sending emails to its clients across Eastern Europe requesting their permission to transfer accounts from the UK regulated office (IBUK) to a new branch recently launched in Budapest (IBCE).

The broker says:”Your relationship with IBUK utilizes what is known as a financial services passport which allows the provision of services across Europe. IBUK's passporting rights are expected to expire at the end of the year, and IBKR, therefore, plans to do business with you through a European entity as of 1 January 2021.”

Meanwhile, it is not yet clear whether such invitations are received by the clients of the European Union jurisdiction, or whether it is only about residents of Eastern Europe. Moreover, Interactive Brokers also has an active representative office in Luxembourg.

The company launched a subsidiary in Hungary at the beginning of this month. The new entity has been licensed by Magyar Nemzeti Bank, Hungary's Central Bank on December 12, 2020. Miklos Hanti serves as CEO for IBCE.