EU leaders have prepared a draft guideline for Michel Barnier, EU’s Brexit negotiator Michel Barnier, before the commencing of Brexit negotiations.
Leaders across the European Union have warned Britain that if it were to assume that its financial services industry will be included in any free trade agreement after Brexit, it would be mistaken.
The move essentially fixes negotiating terms in a draft document.
British Prime Minister, Theresa May, could potentially open negotiations with the EU in June, assuming she wins a snap elections she called last week.
She has single out Britain’s banking and other financial services as her key priorities for a future trade deal with the EU after Brexit.
EU’s member states, including France, have pressed home the point that any deal that allows the City of London the continued access to EU markets will necessarily have to bind Britain to continuing regulation and supervision by Brussels.
“The 27 will not necessarily consider financial services in a free trade agreement, as Theresa May has expected,” said an EU aide.
The new draft agreement, will act as a guideline for Michel Barnier, EU’s Brexit negotiator Michel Barnier, will be reviewed by EU ministers on Thursday and is expected to be signed off swiftly at Saturday’s EU27 summit.
“There is nothing controversial in this among the 27,” said a second diplomat. “We found a way to say things so that everybody feels safe.”
As per several other participants, there would be no specific mention of financial services as an economic sector in the draft agreement, which will instead stress that any future relationship should not endanger the “financial stability” of the EU’s economy.
“Any future agreement on financial services will be subject to EU supervision and regulation,” said a diplomat.
Already Germany, France among other countries are attracting financial firms to set roots in Frankfurt and Paris once Brexit cuts off London from the Bloc.
With Emmanuel Macron likely to be the next French president, France’s position on this matter is unlikely to undergo change.