France aims to delay access to the European single market for British financial firms until it considers that the British government is meeting its post-Brexit commitments on fishing rights, according to people familiar with the matter.
French officials are seeking to block a funding regulatory cooperation deal as part of a larger effort to pressure the UK, people said, asking not to be named in private conversations.
The non-binding MoU would be a first step towards future cooperation and pave the way for granting market access to UK businesses later. France’s reluctance to let even this take effect shows how politically British hopes for access to the European Union’s financial markets are.
The French are determined to meet Britain’s commitments in the post-Brexit trade deal amid unrest in northern fishing ports over delays in obtaining licenses to continue fishing in the British waters.
Before the MoU can be implemented, the 27 EU members must approve and this formal process has not yet started. The process could begin in the next few days, the people said.
Tensions between the UK and France reached a new level last week when ships from both navies were sent to the British island of Jersey, a few miles off the French coast, where dozens of French boats had organized a demonstration. While angry fishermen are back in port for now and negotiations between France and Jersey are about to restart, France complains that many French crews are still waiting for licenses to resume work in British waters.
The young French Minister for European Affairs, Clément Beaune, has publicly threatened to limit the access of British financial services companies to the EU if fishing boats are not treated fairly. At the end of the month, EU leaders will meet in Brussels, where they will discuss relations with the UK, which violated the Brexit deal on Northern Ireland and fisheries, according to the French ministry. Foreign Affairs.
The European Commission and an official from the Beaune office declined to comment on France’s position.
The negotiations over fishing rights have been one of the most controversial elements of the post-Brexit trade deal signed by the two sides last year. The deal largely sidelined the financial sector and the EU has since said it was in no rush to grant the equivalency rulings that would restore trade rights for UK companies.
At the end of March, Great Britain and the EU agreed on a forum on cross-border access to financial markets. While granting so-called equivalencies that would allow UK financial firms to do business in Europe remains a separate and unilateral process, the MoU would help speed up the process.
Since Brexit went into effect in early 2021, London-based financial firms have largely been unable to operate in the bloc, forcing banks like JPMorgan Chase & Co. and Goldman Sachs Group Inc. to move funds. billions of dollars in assets and thousands of employees. on the continent.
– With the help of Alberto Nardelli