British Prime Minister, Theresa May, has struck a tentative deal with the EU that would give financial services companies in the United Kingdom continued access to European markets after Brexit, The Times reported on Thursday.
Naija News understands that British and European negotiators have reached tentative agreement on all aspects of a future partnership on services, as well as the exchange of data.
The deal is also expected to give UK companies access to European markets as long as British financial regulation remained broadly aligned with the EU’s, according to the Times. The pound jumped, rising 0.9 per cent to as high as 1.2881 dollars.
UK and EU close to #Brexit deal on financial services, UK official tells @Reuters, https://t.co/L0pW7PmBpb Revisit @ReutersGraphics assessment of London’s financial pulse: https://t.co/wdXR41GA5A pic.twitter.com/v9rl558SrA
— Reuters Business (@ReutersBiz) November 1, 2018
According to The Times report, the EU will accept that the UK has “equivalent” regulations to Brussels. UK financial services companies will be allowed to operate as they now do in Europe.
EU officials said the EU’s financial market access system known as “equivalence,” under which Brussels grants access to foreign banks and insurers, if their home rules converge with the bloc’s, is probably Britain’s best bet.
“Equivalence” has so far had limited application because, for one under existing rules, market access can be withdrawn unilaterally with only a month’s notice,’’ The Times said.
Under the new deal, it will be extended and fall under the governance of a wider trade treaty, allowing the EU and the UK to change or set new financial regulations after consulting each other beforehand, the newspaper said.
May’s principal Europe Adviser, Oliver Robbins, is continuing the negotiations in Brussels, according to the report.
With five months to go before Brexit, business leaders are demanding certainty over the kind of trade terms the divorce will deliver.
“The UK’s Financial Conduct Authority wants Britain to stay closely aligned with the EU, but without Britain’s having to copy all the bloc’s rules,’’ the Acting Director of Strategy at the FCA, Richard Monks, said.