Yahoo Finance EU's Barnier deals fresh Brexit blow as he rules out special deal for bankers
Bankers and the UK’s financial services sector will not get any special Brexit deal, Europe’s lead negotiator has warned.
Michel Barnier said British banks would lose the passport that allow them to trade freely across the EU, dealing a significant blow to Theresa May’s hopes.
It’s also a big snub to David Davis, his opposite number in the UK, who had promised specially tailored arrangements would be in place after Brexit in March 2019.
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But Barnier, speaking to the Guardian, has delivered a big knock-back to those ambitions.
“There is no place [for financial services],” he said. “There is not a single trade agreement that is open to financial services. It doesn’t exist.”
He added: “In leaving the single market, they lose the financial services passport.”
The EU negotiator also went on to say that should the proposed transition period be agreed, the UK would have to adhere in full to the rules, principles and laws adopted by the bloc for those two years.
That would include abiding by any new directives and regulations adopted after British ministers and MEPs are no longer part of the EU decision-making process. “The same rules for everyone – this is the spirit of the transition,” he said.
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Such a stance is bound to inflame arch Brexiters, who will again see this as Theresa May expected to give ground in exchange for little from the EU.
Barnier said British red lines on leaving the European Court of Justice and ruling out free movement of people meant the only option was a free-trade agreement similar to one the EU agreed with Canada in 2016.
Davis has already spoken of a “Canada plus plus plus” arrangement for Britain that would include financial services – but Barnier’s tough stance, backed as it is by the remaining 27 members of the bloc, also casts significant doubt on that prospect.
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Theresa May’s full Cabinet is to meet on Wednesday to discuss what trading deal the UK should be seeking.
It follows Monday’s meeting of her Brexit “war Cabinet” of key ministers and close advisers where an outline of that trading relationship was understood to have been discussed.
