On Thursday, the U.K. and Switzerland sealed a post-Brexit financial services agreement, which, according to British Finance Minister Jeremy Hunt, was not an option while the U.K. was still a part of the European Union. The Minister stated that the fresh accord would serve as a template for future deals that the U.K. might make with other nations. He labelled it a “first-of-its-kind” victory for post-Brexit Britain.
On Thursday, the U.K. and Switzerland signed a post-Brexit financial services deal in order to strengthen ties between two of Europe's top banking centres. Jeremy Hunt, Britain's Finance Minister, told CNBC that the groundbreaking arrangement could not have been made within the European Union. He dubbed it the Bern Financial Services Agreement and declared it a success for post-Brexit Britain. Hunt also expressed his view that this mutual recognition accord could be used as a template for further trade agreements with other nations. At a press conference to announce the deal, the Minister affirmed that this "new type of trade agreement" could be employed as an example for future agreements.
Hunt travelled to Bern to come to an understanding with his Swiss colleague, Karin Keller-Sutter, who said that it would be beneficial to both countries in the long run. The agreement, which was the result of negotiation for more than two years, is intended to make it easier for financial services and affluent people to conduct dealings between the two nations, and give them a better platform to sell their products including banking, insurance, and asset management services. The arrangement is based on a recognition idea that firms can do business in the counterpart country abiding by just one set of regulations and don't necessarily have to establish a physical branch. Thus, this implies that financial services providers and insurance companies can give certain transactions that cross borders in both Switzerland and the U.K.
The terms will make it possible for Swiss firms to serve wealthy U.K. individuals either in-country or customarily, replicating rights that British companies had in Switzerland even before Brexit. U.K. consultants, too, can "temporarily" help wealthy customers in Switzerland without the need to register there.Hunt described the proposals as a "light-touch, progressive, and forward-looking way of opening access," one that would provide a considerable support for the City of London. Hunt revealed that the agreement could be broadened to include retail and sustainable investment in the future.Salvo parliamentary endorsement from both countries, the deal could come into effect next year. However, some observers were hopeful that it would be superior to the equivalence scheme Britain had with Switzerland when in the EU.
David Henig, the U.K. director for the independent research organization European Centre for International Political Economy, expressed his approval of the agreement, describing it as "broadly good news" as it takes advantage of Britain's prominence in financial services. This follows the Credit Suisse debacle in March which cast a shadow over Switzerland's financial sector. In 2020, when he was Chancellor of the Exchequer, the current British Prime Minister Rishi Sunak initiated negotiations with Switzerland, expressing his vision of an "open, global and free" economy. Since the UK's official exit from the European Union on 31st January 2020, the Conservative administration has been promoting the advantages of forging new trade agreements; the latest being the partnership with eleven Asia-Pacific countries, including Australia, Singapore, Japan and Canada, which was agreed in June.
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