UK and Switzerland deepen ties through ‘global first’ financial services deal

The chancellor has signed an agreement aimed at strengthening financial services ties with Switzerland, describing the arrangements as a “global first”.

It aims to increase access to each other’s markets and is based on mutual recognition of laws and market regulations in both countries.

The Treasury said the Berne Financial Services Agreement marked a “ground-breaking pact for financial services cooperation” that was only possible because of the “freedoms” Britain now enjoys through its departure from the EU.

The agreement “enables the frictionless, cross-border provision of financial services between the UK and Switzerland across areas such as wealth management, banking and investment services,” the statement said.

“For certain sectors, this means that a company based in the UK will be able to serve clients in Switzerland while largely following UK regulations and vice versa.

“The agreement also ensures unique access for UK insurance brokers to the Swiss market.

“From the start of 2024, Switzerland will require all non-Swiss companies to establish a base in the country before serving Swiss customers.

“The UK will be the only country in the world not required to do this, giving UK brokerage firms a significant advantage over international competitors as they can continue to do business as they always have.”

The UK’s financial services relationship with Switzerland was previously based on EU rules despite Switzerland not being a member of the bloc.

Jeremy Hunt and his Swiss counterpart Karin Keller-Sutter shake hands after signing the agreement in Bern. Picture: AP

Between 2016 and 2022, UK trade in financial and insurance services with Switzerland grew by 53%, according to Treasury figures, reaching £3.28bn. GBP in 2022.

Britain had risked losing that access in the wake of Brexit without a direct treaty.

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Leaving the EU meant that London lost some business to EU capitals due to efforts by member states and the European Commission to ease their dependence on London as a financial centre.

The Financial Conduct Authority on Wednesday unveiled plans to simplify and speed up company listings.

It was billed as the biggest overhaul of its kind in three decades to help London better compete with New York and other centers for corporate listings.

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The Switzerland agreement could potentially be expanded in the future to cover broader trade arrangements, which remain under discussion.

Chancellor Jeremy Hunt said: “The Berne Financial Services Agreement is a global first and builds on the strengths of the UK and Switzerland as two of the world’s largest financial centres.

“It cements open access for financial services between our two nations for decades to come, helps us grow the economy and serves as a blueprint for future deals with other key trading partners.”

Miles Celic, who heads lobby group TheCityUK, added: “This innovative framework not only simplifies engagement with financial services, reduces barriers and increases efficiency, but it also strengthens market confidence and drives innovation.

“It establishes a new and ambitious benchmark for how major financial centers can work together to establish gold standard agreements, contributing to a more robust, competitive and interconnected global financial landscape.”

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