On Friday 26 March, the British government announced that the European Union and the United Kingdom have reached agreement on a framework for cooperation in financial services, in accordance with the specific declaration attached as an annex to the bilateral cooperation agreement signed at the end of 2020 (see EUROPE 12632/9).
On Monday 29 March, a European Commission spokesperson confirmed that technical discussions on the ‘Memorandum of Understanding’ (MoU) had now been completed, but that formal steps still needed to be taken by both sides before it can be signed.
Once it has been signed, the MoU will create the administrative framework for “voluntary regulatory cooperation in financial services between the UK and the EU”, he said. The MoU will establish the Joint UK-EU Financial Regulatory Forum, which will serve as a platform to facilitate dialogue on financial services issues.
It should be remembered that this process is without prejudice to any equivalence decisions between UK and EU legislation that the Commission may grant.
According to the Financial Times, the forum’s activities will include reducing uncertainties and identifying potential problems in cross-border implementation. It also stated that both parties will cooperate to avert regulatory arbitrage. It stated that there will also be bi-annual meetings between the British Chancellor of the Exchequer and the EU Commissioner for Financial Services.
On the EU side, the MoU will take the form of a non-binding instrument, which still needs the endorsement of the Council of the EU. (Original version in French by Marion Fontana)