UK and EU move closer to pact on post-Brexit financial regulation
The agreement was on hold due to the UK-EU row over Northern Ireland, but was unlocked by the Windsor Framework.
The UK and EU have taken a “significant step” towards closer post-Brexit ties on financial services regulation, a Treasury minister has said.
The UK and European Commission have published a draft memorandum of understanding (MoU) on regulatory co-operation in the sector.
The UK financial sector’s previously unfettered access to the EU was largely cut off after Brexit.
The MoU on how financial regulators on both sides would communicate after the UK’s exit was initially expected in 2021.
It stalled amid the long-running dispute between the UK and EU over Northern Ireland trading arrangements, but was unlocked by the Windsor Framework struck by London and Brussels earlier this year.
This framework will mean we can engage with our partners in the EU, much as we do with other major partners like the US
The MoU still needs political endorsement from EU states, but “thereafter HM Treasury and the European Commission intend to sign the MoU shortly”, according to the Treasury.
City minister Andrew Griffith said: “This is just the first yet significant step towards a more constructive financial services relationship between the UK and the EU – one that is built upon mutual benefit and in the spirit of co-operation.
“Our financial markets are deeply interconnected and this framework will mean we can engage with our partners in the EU, much as we do with other major partners like the US.”
The European Commission on Wednesday adopted the draft MoU.
I am confident that our relationship and future engagement in financial services will be built on a shared commitment to preserve financial stability, market integrity, and the protection of consumers and investors
It commits the two sides to “jointly endeavour to pursue a robust and ambitious bilateral regulatory cooperation in the area of financial services”.
Mairead McGuinness, the EU’s financial services commissioner, said: “The Windsor Framework allowed the EU and the UK to open a new chapter in our partnership based on a spirit of mutual trust and cooperation.
“I am confident that our relationship and future engagement in financial services will be built on a shared commitment to preserve financial stability, market integrity, and the protection of consumers and investors.”