Brexit and financial services: what comes next?

Like many areas concerning Brexit, accurately predicting the outcome of negotiations concerning the provision of financial services and future developments is problematic. The Brexit White Paper states "In our new strategic partnership agreement we will be aiming for the freest possible trade in financial services between the UK and EU member states". 1 At present, financial service providers based within the single market benefit from "passporting" privileges. Passporting, formalised by the second banking directive of 1989, 2 allows institutions established in one member state to freely provide and access services in other member states, with further passports issued to EEA states. Compliance with a common minimum regulatory standard as a condition of continued single market membership facilitates trading through passporting.