The UK and the European Union have agreed the terms for the future interaction of financial services between the two countries.
Officials from the European Commission, the EU’s executive, and the UK Treasury have been locked in talks on the future of financial services since January, in a bid to sign a Memorandum of Understanding on regulatory co-operation. after Brexit before last. of this month.
A statement from the UK Treasury said: “Formal steps must be taken on all sides before the MoU is signed but this is expected to be possible soon.”
A statement from the European Commission said: “The MoU, once signed, will create an administrative framework for voluntary regulatory co-operation in financial services between the UK and the EU. the UK-EU Financial Regulation Forum, which will be a platform to enable communication on financial services issues. “
The text of the post-Brexit framework for financial services has been agreed but has not yet been released, according to someone familiar with the matter. The agreement is in principle subject to the approval of the 27 EU member states.
The final agreement is expected to mirror an existing framework between the EU and the US by introducing a commitment for regulators on both sides to meet regularly to discuss future rule-making. come and share information.
READ Emerged: The draft summary for the Brexit deal on financial services
Draft agreement, released in February and viewed by Financial News, including a commitment to “consult informally on decisions to take, defer or withdraw equality” – the EU regulators’ process for giving UK companies market access if the country ‘s financial rules are considered similar to their own.
They also promised to respect the “independence of regulatory leadership” on both sides.
News of an agreement in principle on financial services marks a rare high in UK-EU relations that have been under pressure since the Brexit trade agreement was agreed in December, with ongoing series of issues leading to imports into the Northern Ireland border and export of coronavirus vaccines.
The December trade deal largely rejected the UK treasury and led the government to initially commit to an agreement that would reduce Brexit-led barriers to trade, investment banking and asset management. UK policymakers have indicated that they would push for a Brexit deal for equality-dependent finance.
READ EU financial deal seen following US model in blow to Brexit optimists
But frustration has since escalated the EU’s reliance on equal access to financial services for the trade bloc.
The Prime Minister’s office in February complained about the UK’s willingness to implement the UK equality bloc. Bank of England governor Andrew Bailey has also called on the EU to reconsider its approach to determining post-Brexit UK access to the trade bloc.
To contact the author of this story with feedback or news, email Lucy McNulty