The UK as a Third Country Actor in EU Financial Services Regulation

Abstract

Unless it remains in the single market via membership of the EEA or is able otherwise to negotiate special access terms, after Brexit the UK will have to fall back on the third country provisions of EU financial services regulation. This paper examines the complexities of the current Union approach to the treatment of third countries and considers the likelihood of Brexit smoothing the progression towards a more unified EU system. The paper also considers what the evolution of the EU’s treatment of third countries is likely to mean for the UK as it seeks to negotiate continued access to the EU market. Finally, the paper explores new opportunities for the UK to innovate in regulatory design without impairing equivalence or undermining its commitment at the international level to global regulatory convergence.

Keywords: Brexit, EU financial regulation, third countries, equivalence

JEL Classification: G20, F30, K20, L50, P16