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UK-Switzerland Seal Post-Brexit Financial Services Deal

2023.12.22

 

Key Takeaways

  • The U.K. and Switzerland finalize a financial services agreement post-Brexit, promising mutual benefits.
  • The deal introduces a unique regulatory model, boosting London’s financial market and offering new opportunities for Swiss firms.

A Landmark Financial Collaboration

The United Kingdom and Switzerland have embarked on a new chapter in financial cooperation by signing the Bern Financial Services Agreement. This groundbreaking deal, a result of post-Brexit negotiations, was finalized in London on Thursday. Jeremy Hunt, the British Finance Minister, hailed the agreement as a significant achievement for the U.K., opening doors to future partnerships outside the European Union.

Benefits and Blueprint for Future Agreements

The agreement, signed by Hunt and his Swiss counterpart Karin Keller-Sutter, is set to enhance the business landscape for financial firms and affluent individuals in both countries. It follows a deference model, simplifying cross-border financial activities and reducing regulatory burdens. This model allows financial service providers to operate more freely between the two nations, potentially expanding to include retail and sustainable finance sectors.

Implementation and Expectations

Scheduled for implementation next year, the deal awaits parliamentary approval in both countries. This agreement is seen as a progressive step, surpassing the previous equivalence framework that the U.K. shared with Switzerland while being part of the European Union. David Henig, Director at the European Centre for International Political Economy, views this as an optimistic move, leveraging the U.K.’s financial prowess.

A Post-Brexit Strategic Move

The U.K. government, under Prime Minister Rishi Sunak, initiated these discussions in 2020. This deal aligns with the U.K.’s strategic objective to establish itself as a significant global player in finance and trade post-Brexit. The government’s focus on forging new trade relationships is evident in its recent accession to an Asia-Pacific free trade bloc, marking its third major trade agreement since leaving the European Union.

 


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