No financial hub without EU rules, UK told

EUROGROUP head Jeroen Dijsselbloem warned yesterday that it would be impossible to maintain Europe’s financial capital in London if Britain chooses to thwart EU rules after Brexit.

“Being quite frank, we can’t allow the financial services centre for Europe and the eurozone to be outside Europe and the eurozone and to go its own way in terms of rules and regulation requirements,” Dijsselbloem told a European Parliament hearing in Brussels.

“We can’t let that happen. We have to take a firm stand on this. There is no alternative there,” he said.

Dijsselbloem spoke as the government of Prime Minister Theresa May distanced itself from a memo suggesting Britain believed it can keep the privileges of the European single market, while also limiting immigration by European citizens after it leaves the bloc.

Britain is especially eager to preserve the EU’s so-called passporting rights that allow banking and financial services, approved by a single member state to apply across the European Union.

The memo, caught inadvertently in a photograph, also indicated that Britain would refuse joining the tariff-free European Economic Area, which could also give single market access but only by obeying EU law.

But Dijsselbloem, who is also Dutch finance minister, said that his “preferred option” would be that Britain accept all EU rules and regulations on financial services so that this type of set-up could continue.

He noted however that Britain seemed dead set on reclaiming sovereignty and would not accept the conditions that come with the EU’s single market, including free movement of people.

“We cannot allow a third country to have access to the financial services market in Europe if at the same time we allow them to deviate from the rules,” he said.