On the fringes: EU-UK financial services under the TCA

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The outcome of the Trade and Cooperation Agreement (TCA) for trade in financial services between the EU and UK deal was even more paltry than expected. The TCA does not even institute a dedicated financial services committee, but rather a general one for services. Nevertheless, there is a deal that provides for an umbrella, a governance structure, and a mechanism for dispute settlement and cooperation in a variety of fields, as might be expected for a former member and close neighbour. Joint actions have also been envisaged on money laundering (which remains problematic even within the EU), cybersecurity, and in financial programmes of the European Investment Bank (EIB). The agreement contains a long list of member states’ specific market access reservations, notably on financial data processing services – a clear sign that this is no longer a Union but a loose trade agreement. Only supervisory equivalence agreements between both parties covering some aspects of the free provision of financial services could somehow maintain the appearance of the frictionless trade of before.

Karel Lannoo is General Manager of ECMI and CEO of CEPS.