U.K. in `Preliminary Foothills' of EU Financial Services Talks

(Bloomberg) -- The U.K. is not yet in any “substantive discussions” with the European Union about a future relationship in financial services, Chancellor of the Exchequer Philip Hammond said on Wednesday.

“We’ve only just got past the agreement on the implementation period, we haven’t yet come to substantive discussions on the future partnership. But we are in the preliminary foothills of exploring what might be possible in financial services,” Hammond told Parliament’s Treasury Committee. “We remain ambitious to make progress.”

Hammond said he met with the EU’s financial-services policy chief Valdis Dombrovskis on Tuesday to discuss concerns the industry has about “day-one issues” that firms might face once the U.K. quits the bloc. Dombrovskis said this week that the private sector must take the lead in ensuring that existing financial contracts won’t be disrupted when the U.K. leaves the EU.

That contrasts with the U.K.’s approach so far, which has prioritized a legislative fix to the threat Brexit poses to trillions of dollars of contracts.

Hammond said any future arrangement “would have to have proper mechanisms for resolving any question as to whether equivalence or mutual recognition status had been lost, and there would have to be a proper notice period, so that businesses would be able to understand that even if they did lose their access they would do so in a way that would allow them properly to plan an alternative business strategy.”

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