SMM News: according to an EU document, the EU intends for the first time to cancel some countries' access to some EU financial markets, which will be a wake-up call for the UK at a time when the UK is about to leave the EU.
The document assesses the EU's so-called "equivalent" (equivalence) system, under which the EU grants financial market access to non-EU banks, investment companies, clearing houses or credit rating institutions, provided that the EU determines that the rules for the location of these institutions are in line with EU regulations.
If British companies do not plan to invest in a new financial centre in the EU, they may have to take advantage of the system after Brexit.
According to a notice posted on its website earlier this year, the European Commission plans to reverse the equivalent decisions of credit rating agencies for Australia, Brazil, Singapore and Argentina because the regulations applied by these rating agencies are not as stringent as those in the eurozone.
The draft document, due to be released by the European Commission next week, confirms that the equivalent decision will be cancelled because of regulatory differences.
The EU has adopted more than 280 reciprocal decisions involving 30 countries outside the EU and has never revoked any reciprocal decisions before.
The move is a stern warning to the UK that it must continue to abide by EU rules if it wants its trading platforms, clearinghouses and other financial institutions to have direct access to EU customers.