Last week the world saw the UK leaving the European Union, with a deal in hand. Dayna Camilleri Clarke spoke with British High Commissioner, Cathy Ward to discuss what Brexit means for the financial services sector.
“The finalised Free trade agreement (FTA) provides a stable foundation for the UK to develop our future relationship with the EU and facilitate new arrangements to promote international financial services trade. This means that the UK has full control over its legal and regulatory regime and can make the best decisions about what’s right for the UK in one of its most productive and innovative sectors” began Ward.
“But the UK was not prepared to adopt the EU’s rule book for financial services, as it would have limited the UK’s ability to set regulation that is appropriate for one of the world’s leading financial centres. UK-based firms have carried out extensive preparations to minimise risks of disruption relating to the loss of financial services passporting rights at the end of the Transition Period, and to ensure they can continue to do business with the EU. This is because the financial services passport is not available for firms based in countries outside of the EEA as they are based on the single EU rulebook for financial services.
The UK has long been a pioneer in financial services and the Government has an ambitious strategy to protect and strengthen our world-leading financial centre now that we have left the EU. This is centred upon building long-lasting financial partnerships around the world, maintaining the high regulatory standards that make the UK an attractive place to do business, and being at the forefront of innovation so we can create and seize opportunities in the markets of the future”
Ward explained, in addition to the trade negotiations, both sides are carrying out equivalence assessments. Equivalence is an autonomous mechanism by which one jurisdiction can recognise relevant standards in another jurisdiction as equivalent to their own, which provides preferential treatment for overseas market participants.
She continued to tell the Malta Business Weekly “that the British government has to provide clarity and stability to industry, the UK Government has announced as many equivalence decisions for EEA Member States as we can in favour of openness, and where it makes sense for the UK to do so. The EU has only made limited equivalence decisions for the UK, which is extremely disappointing given that the UK and EU have the same regulatory requirements.
On law enforcement I would add that this is the first time the EU has agreed such a comprehensive agreement with a third country in this area and delivers a comprehensive package of capabilities that will ensure we can work with counterparts across Europe to tackle serious crime and terrorism. This includes:
• Streamlined extradition arrangements which prevent disproportionate extradition requests and long-periods of pre-trial detention;
• Arrangements with Europol and Eurojust that reflect the scale of our contribution to these agencies and facilitate continued operational cooperation;
• Arrangements enabling the fast and effective exchange of national DNA, fingerprint and vehicle registration data via the Prüm system to aid law enforcement agencies in investigating crime and terrorism;
• Arrangements enabling the fast and effective e change of criminal records data via shared technical infrastructure; and
• Arrangements providing for continued transfers of Passenger Name Record (PNR) data to protect the public from serious crime and terrorism.”
Ward concluded “The agreement also provides an additional basis for bilateral cooperation to continue between the UK and Malta after the end of the Transition Period such as information sharing in response to requests, as well as on a spontaneous basis, such as information on wanted and missing persons and objects”