LONDON (Reuters) – The European Union and Britain expect to agree a cooperation framework for financial services by the end of March, but there will be “no rush” in granting the City of London access to the EU, the bloc’s financial services chief said on Tuesday.
Britain fully left the EU’s orbit on Dec. 31, setting its huge financial sector largely adrift from what had been its biggest export customer.
“We will not be recreating access to the single market for the UK as they have chosen to move out,” Mairead McGuinness told an event held by the European Securities and Markets Authority (ESMA).
The shift in euro stock and derivatives trading from London to the bloc without disruption at the start of the year meant the EU has time to reflect on how much access it should grant Britain’s financial sector, McGuinness said.
Once the new cooperation framework is agreed, the next step would be to move on to the detail of future access.
“There is no rush,” McGuinness said.
“There won’t be a moment, as there was with the trade agreement, where we are sitting down and announcing a big package. I see it more on a case-by-case basis,” she added.
“While there may be one or two issues there might be pressure points, there isn’t that great urgency, which allows us time to do the right thing and I think that is understood on the UK side.”
Robert Ophele, chair of France’s markets regulator AMF and an ESMA board member, said the international competitiveness of the EU financial sector was not sufficiently taken into account by regulators.
It would be “totally wrong” to rely on countries outside the bloc for financial services. “It’s also a key point, this competitiveness, if we intend to assess EU financial independence and sovereignty,” Ophele said.
But John Berrigan, who heads the European Commission’s financial services unit, cautioned that a competitiveness objective could conflict with ESMA’s core mandate, though more EU-level supervision will be needed.
“We are not looking at ESMA becoming an EU SEC any time soon,” Berrigan said, referring to the more powerful U.S. Securities and Exchange Commission.
(Reporting by Huw Jones. Editing by Catherine Evans and Mark Potter)