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The UK and Switzerland: enhanced cooperation for financial services

The UK and Switzerland: enhanced cooperation for financial services

Switzerland and the UK are among the world’s leading financial centres. Their cooperation is to be enhanced through mutual market access and recognition of regulations. A new trade agreement is required to this end. This is particularly important for the Swiss banks.

In the name of over 30 industry associations and organisations in the UK and Switzerland, the economic umbrella associations economiesuisse and TheCityUK have published a joint position paper which details key joint industry asks for a bilateral financial services agreement between the two countries. The Swiss Bankers Association (SBA) played a leading role in representing the banking sector in this undertaking and continues to actively support the initiative. Such an agreement would allow Switzerland and the UK, which both have important financial centres, to make substantial progress in the mutual liberalisation of market access. This is very important for the banks in particular.

Enhancing trade relations between Swiss and UK financial services providers

The UK’s exit from the EU, which formally took place on 31 January 2020, offers Switzerland and the UK – two of the world’s biggest exporters of financial services – the opportunity to substantially deepen their bilateral relations in the area of financial services. Such a step sends an important signal, not least in view of the major economic challenges arising from COVID-19, and can support economic recovery.

Switzerland and the UK have always enjoyed close relations and share the conviction that open markets are in their mutual interest. This is also the spirit behind the joint position paper. It details key joint industry asks for a modern bilateral financial services agreement and is broad-based: under the leadership of the two national trade associations economiesuisse and TheCityUK, around 30 industry associations and individual companies from both countries have contributed their concerns and ideas.

Expansion of market access key for banks

An important section of the position paper addresses banking and investment services. For the Swiss banking industry, it is very important that with the Federal Council’s successfully implemented “mind the gap” strategy, not only the status quo is secured, but that above and beyond this, mutual market access is further expanded.

The industry associations emphasise that the stronger cooperation between the two financial centres should be based on the principle of mutual recognition. This means that the opening of markets requires mutual recognition of the relevant financial market regulations and the corresponding supervisory frameworks.

Bilateral financial services agreement Switzerland – UK should be signed soon

The aim is now to quickly express a common political will. As part of a memorandum of understanding and a corresponding roadmap, the initiative is now to be translated into action. Ideally, this should be done before the end of the transitional period agreed between the UK and the EU.

Together with its member banks, economiesuisse and other associations, the SBA will continue to actively support the Swiss authorities in the corresponding efforts. The continuation of the always very constructive and productive collaboration with the partner associations and points of contact in the UK will also play an essential role in this.