The European Commission said on Wednesday it would finalize a long-delayed discussion forum for the bloc’s financial regulators and Britain once the Northern Ireland deal has been implemented by London.
The forum, similar to the one the EU already has with the United States, was due to have been set up in March 2021 but was frozen by disagreements over trade relations with Northern Ireland.
Those disagreements have been ironed out in last month’s agreement, or Windsor Framework, which still needs to be formally enforced by Britain.
“We are ready to start work on finalizing the Memorandum of Understanding on cooperation on financial services regulation,” a spokesman for the European Commission’s financial services unit said on Wednesday.
“Once the Windsor Framework is implemented, this Memorandum of Understanding would allow for a relationship similar to that which exists with other third countries with an important financial services sector,” the spokesperson said.
Brexit left London’s financial district — known as “the City” — largely isolated from the EU, forcing banks, insurers and asset managers to set up hubs in the bloc to avoid disruption to their services.
Around 7,000 jobs in the financial sector have moved from the UK to the continent to staff the new centres, and Amsterdam has overtaken London as Europe’s largest equity trading hub.
The forum has no mandate to decide on access to EU financial markets, but financial industry officials say it could improve the sector’s tense relations across the English Channel and help ease tension in areas such as derivatives clearing.
David Schwimmer, Managing Director, London Stock Exchange Group (LON:LSEG), declared last week that the improvement in relations between the EU and the United Kingdom was “positive” to avoid fragmentation of markets.