John Glen has written to the Chair of the European Scrutiny Committee explaining the Government’s stance on equivalence in financial services. The Government cannot provide great detail given the early stage of negotiations, but says it is seeking regulatory and supervisory cooperation arrangements that will establish and ensure a structured dialogue. It should include transparency and appropriate consultation on how equivalence decisions are adopted, suspended and withdrawn, information exchange and consultation on issues of mutual interest. The Government is keen to ensure there are “coherent” structures to deal with the consequences of any withdrawal of equivalence.
The Government is also seeking equivalence in all the current regimes and wants to ensure this has happened by 31 December.
The letter also deals with the concept of “assurance” from CCP supervisors for EMIR purposes, noting that ESMA’s advice on this issue is not clear, but that the Commission has not yet adopted the delegated acts under EMIR 2.2 so it is too soon to say how it will function in practice.
Finally, the letter does not answer the question on whether the Financial Services Bill will allow Treasury to implement EU legislation after the transition period has ended. It merely states the Bill will allow the UK to maintain “world-leading regulatory standards” to support global competitiveness and protect consumers.