LONDON (Reuters) – The European Union will only decide how to reform its share trading rules once it knows whether exchanges in Britain will have access to the bloc after a post-Brexit transition period ends in December, a senior EU official said on Tuesday.
The EU and Britain have clashed over the bloc’s “share trading obligation”, or STO, which mandates where investors in the EU must trade specific stocks.
One UK exchange has accused the EU of a “land grab” in trying to steal market share from London, where heavy volumes are traded in companies whose main listing is in the EU.
“We have to wait (to find out) what the result of the negotiations between the EU and UK will look like before we take a considered view on how to structure our various trading obligations,” Tilman Lueder, a senior official in the European Commission’s financial services unit, told a webinar held by exchanges industry body FESE.
Carsten Ostermann, a policy officer at the EU’s markets regulator ESMA, said there was consensus on reducing the scope of the STO to shares that have their main pool of liquidity inside the EU, Ostermann said.
“The question then is how exactly do you define those instruments,” Ostermann added.
Stephane Boujnah, CEO of pan-European exchange Euronext, said the STO should be kept and limited to shares whose primary listing is in the bloc, with dual-listed shares exempt.
Last week Britain and the EU ended a fourth round of negotiations on a trade deal, but made little progress as fishing rights remain a stumbling block.
EU financial services access is being considered in separate assessments, though an actual decision could be determined by progress in the wider trade talks.
Markus Ferber, a German lawmaker who steered the EU’s securities rules through the European Parliament, said he was disappointed by last week’s talks as not a minute was devoted to financial market issues.
(Reporting by Huw Jones; Editing by Gareth Jones)