The Bank of England has just announced that European Banks will be allowed to maintain the administrative and commercial status quo when Britain leaves the EU. This means that large European Union based banks will only have to be be represented in London by branches rather than bank subsidiaries which are legally set up in the UK. These branches will be able to keep their assets and liabilities on the books of their Headquarters in Europe. Control of these branches from a risk and liquidity point of view will be from the Head Office in Europe. Britain is too weak to insist that these banks open subsidiaries in the the UK.
http://www.bbc.co.uk/news/business-42420829
If Britain leaves the EU, without a banking agreement for the "passporting" of financial services, then UK banks will have to set up subsidiaries in the EU. The assets and liabilities and profits will then become under the domain of the EU country where they are resident. So will the staff. Britain loses out. The EU have made it clear that to gain single market access, to the EU financial services market, Britain will have to agree to free movement of labour. Britain will have little choice: it is not powerful enough to insist that we have have complete access to the single market without accepting freedom of movement.
So much for taking back control and sovereignty. The Bank of England has just ceded control and sovereignty to the EU. Who voted for that?
By remaining in the EU, Britain would have had a big say in how European banks should act, we would have pooled our sovereignty. Now we have lost all say and the European Banking Authority is being transferred from London to Paris, and the Authority will only be wrenched back from Paris with extreme difficulty and only if we rejoin the EU. If you voted leave, well done. You have been duped again and our nation will lose billions of pounds worth of financial trade and influence.
A place where sceptics can exchange their views
Wednesday, 20 December 2017
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