One of the EU’s top voices in market regulation has stated the UK will have to apply EU standards for financial service providers based in Britain to do business.
Markus Ferber, member of the European Parliament, issued an online Q&A on the implications the Brexit will have on market regulation and tax policy, in which he stated: “There is no automatism” for financial service providers.
He said Britain’s access to the EU single market “will only be possible if equivalence of the British legal framework with the European one is safeguarded. The United Kingdom will essentially have to apply European standards that it can no longer influence.”
Ferber also stated the European Banking Authority (EBA) will have to be relocated from London, and following the UK exit, Britain will be responsible for regulating its own tax and competition issues.
In addition, Ferber has given his assurances that there will be no change of course on implementing market regulations despite a change of guard at the European Commission.
Jonathan Hill, the European Commissioner in charge of Financial Stability, Financial Services and Capital Markets Union (CMU) announced his resignation on 25 June and will be replaced by Commission vice-president Valdis Dombrovskis.
Lord Hill was charged with establishing a CMU by 2019, for all 28 Member States of the EU, and maximising the benefits of capital markets.
Despite worries over the future of the initiative, Ferber eased worries by stating that Dombrovskis has a ‘similar understanding of financial markets legislation’.
He added: “Hence, there will be stability in those troubled times.”