Mar 19, 2021
The European Union and the United Kingdom have had a long journey towards reaching some sort of agreement when it comes to co-operation, and it seems the end is finally nearing. There may be a conclusion that could give the firms in the City of London access to the single market.
A common framework would help safeguard a joint agreement on how financial services could access the E.U. market. The two sides have been negotiating since January, and the latest draft of the memorandum includes a note that both sides will be transparent about their taxation plans as well as their efforts to battle financial terrorism and money laundering. Mairead McGuinness, E.U. bloc’s commissioner for financial services, commented, “We’re in a good place around the memorandum of understanding”.
Earlier this week, Brussels launched legal action against the United Kingdom due to the breaches of the Brexit deal on Northern Ireland. The United Kingdom has been easing trading conditions on Northern Irish businesses, which breaches Brexit’s treaty. This could lead to the United Kingdom getting hauled before the European Court of Justice and potentially even facing trade sanctions. A memorandum of
understanding is due by the end of this month.
Mairead McGuinness said in a conference on Tuesday, “Once the regulatory cooperation framework is in place, we will resume the assessment of equivalence with the U.K. authorities,” she added, “But let me clear on two points: first, there cannot be equivalence with wide regulatory divergence. Second, we will grant equivalence only when it’s in the E.U. interest – just as the U.K. has made its own equivalence
decisions in their own interest.”
France’s Clement Beaune, junior minister for E.U. affairs, commented in February, “There will probably be partial equivalence, probably by the end of the semester,” adding that it would be “revocable, provisional, unilateral on the part of the E.U.”