10 November 2020

FT: Brussels holds out on post-Brexit financial services access for UK

EU still unsure what rights to grant City of London despite Sunak step. Brussels has warned that it will only grant the City of London market-access rights that are “in the EU’s interests” even after Britain adopted regulatory decisions designed to smooth future ties.

Britain’s chancellor Rishi Sunak on Monday announced the government was taking regulatory decisions intended to ensure that EU-based exchanges, clearing houses and financial benchmarks could continue to be used by UK customers.

The moves, known as equivalence decisions, effectively endorse EU regulations and financial supervision as being as good as the UK’s. Mr Sunak said the step was intended to give financial companies in the UK and EU more certainty over trading arrangements after the end of the Brexit transition period on December 31.

But Brussels made clear on Tuesday that it was unmoved by the British gesture, and that it was still assessing whether to grant the UK reciprocal equivalence. Making equivalence designations without a quid pro quo agreement with the EU is a bold step by the UK and puts the ball in the EU’s court John Garvey, global financial services leader at PwC

A European Commission spokesperson told the FT that the UK announcement “provides no further clarity on the UK’s possible divergence from EU rules going forward, or about the UK’s future supervisory practices”. “The Commission’s equivalence processes are autonomous. We will consider equivalence decisions where they are in the EU’s interests,” the spokesperson said.

The rebuff will feed into growing tensions between London and Brussels over access to each other’s financial services markets....

more at FT

© FT plc