DUBLIN (Reuters) - Britain’s financial companies can either establish full-blown subsidiaries in the European Union after Brexit or fall back on financial regulatory “equivalence”, European Commission Vice-President Valdis Dombrovskis said on Thursday.
EU negotiators see no room for Britain keeping “passport” access to EU financial markets for its banks, diplomats in Brussels said earlier this week. And Dombrovskis told a separate event in Dublin late on Wednesday this could be discussed given Britain’s wish to leave the single market.
“Equivalence is applied to a third country with a regulatory and supervisory framework comparable with the EU and can be used as a tool,” Dombrovskis told a news conference in Dublin.
“Another possibility, which is currently available is the establishment of presence in the EU27, that doesn’t mean letterbox companies.”
Equivalence is a legal mechanism that allows countries from outside the bloc to access the single market of 440 million consumers in limited circumstances.
Banks were already speaking to local authorities in connection with relocating within the single market, Dombrovskis said.
“This is all that is currently available, but I cannot prejudge at this stage what the outcomes of the negotiations will be,” he added.
Reporting by Graham Fahy, editing by Padraic Halpin. Editing by Jane Merriman