EU ‘ready to grant’ City of London access to European markets after Brexit
Wednesday, 08 July 2020
The EU is prepared to grant the City of London access to European markets after Brexit, according to EU chief negotiator Michel Barnier.
Formal post-Brexit trade talks started again on Wednesday after several rounds during which little progress was made. Barnier met with the UK’s chief Brexit negotiator, David Frost on Tuesday for an informal meeting during which they reportedly discussed the most difficult points of the negotiations.
The EU is “ready to grant equivalence,” Barnier recently told the House of Lords EU Committee. This would mean that the EU would “recognise that the regulatory or supervisory regime” of the City of London “is equivalent to the corresponding EU regime,” according to the EU’s definition.
In late June, however, Barnier had “rejected British proposals to smooth the City of London’s access to European customers,” according to the Financial Times, saying that “it wants to ban residence requirements for senior managers and boards of directors, to ensure that all essential functions remain in London” and that “it wants almost free rein for service suppliers to fly in and out for short-term stays.”
“We will only grant equivalences in those areas where it is clearly in the interest of the EU: of our financial stability, our investors and our consumers,” Barnier said at the time.
While granting equivalence is not part of the current trade negotiations between the EU and the UK, withholding access for the City to European markets could be used as a bargaining chip in the negotiations to get the UK to make compromises.
“The time for decisions is in the autumn, in good time,” Barnier said, “in the global context of our negotiations on many subjects with the UK.”