Chancellor Jeremy Hunt will today sign a long-awaited deal with the European Union on improving regulatory cooperation for financial services, in a move that Hunt said will boost the City as a “global financial services hub”.
Hunt and EU financial services commissioner Mairead McGuinness will sign a Memorandum of Understanding (MoU) at the European Commission today, marking Hunt’s first visit to Brussels as chancellor.
Hunt said the deal, which builds on existing agreements between the UK and the USA, Japan and Singapore would help “support the sector as a global financial services hub”.
“The UK and EU’s financial markets are deeply interconnected and building a constructive, voluntary relationship is of mutual benefit to us both,” Hunt said.
UK Finance boss David Postings welcomed the deal as “an important step forward… on removing frictions and supporting a better flow of mutually beneficial cross-border trade with the EU.”
Miles Celic, TheCityUK chief executive, called the signing “another positive step forward in rebuilding UK-EU relations” and said industry was hoping to see “constructive dialogue”.
He added: “Progress has been a long time coming… a joint forum to discuss regulatory cooperation is vital to boost coordination and communication on issues of mutual interest.”
hris Hayward, City of London Corporation policy chairman said the MoU “sets the stage for a new era of cooperation with our EU partners”, adding the agreement “will help ensure both our financial services sectors remain open for business”.
Chris Cummings, chief executive of the Investment Association, said the MoU was an “important milestone” for a “more resilient and dynamic investment management sector”.
But Cummings stressed the forum needed to deliver “pragmatic dialogue” and address issues including retail participation, international coherence, sustainability, and tech and innovation.
According to Treasury figures, the UK financial and professional services sectors were worth £275bn last year – roughly 12 per cent of the UK economy.
It comes after Prime Minister Rishi Sunak and European Commission president Ursula von der Leyen signed the Windsor Framework deal earlier this year.