The UK is ready to set out its vision for how it wants financial services to operate after Brexit and favours an ambitious “mutual recognition” of regulations to preserve the City of London’s access to the European Union. Under Britain’s proposal, the UK and the EU would recognise each other’s regulatory and supervisory regimes and would have aligned rules at the point of Brexit, with a mechanism that would monitor any divergence. One said: “They are going down the route of mutual recognition.” Another person close to the discussions called the preferred option a “dynamic reciprocal mutual recognition model”. Theresa May, who is to discuss Brexit with German chancellor Angela Merkel in Berlin on Friday, has said she wants to include financial services in a free trade deal. She said it covers only about a third of financial services activities, it requires third countries to shadow new EU laws and “equivalence” designations can be withdrawn by Brussels with 30 days’ notice.

Source: The Irish Times February 16, 2018 15:19 UTC