Michel Barnier has ruled out any potential for a special Brexit deal for the City of London.
The European Union’s chief Brexit negotiator said that British banks and financial firms would have no choice but to lose their passports rights following the decision to quit the single market.
“There is no place [for financial services]. There is not a single trade agreement that is open to financial services. It doesn’t exist,” said Barnier. “The red lines that the British have chosen themselves. In leaving the single market, they lose the financial services passport.”
Barnier’s comments came amid reports that Prime Minister is planning her third major speech on Brexit in which she will set out her post-Brexit vision for the UK.
May has made clear that she intends to remove the UK from the single market post-Brexit, therefore ruling out Norway-style free access to trade with the EU.
In an exclusive interview with European newspapers, the European Union’s chief Brexit negotiator said that a trade deal could be agreed within the two-year transition period. This trade deal would have to be ratified by more than 35 national and regional parliaments.
During the transition period, Barnier made clear that the UK was able to discuss trade deals beyond Europe but these would not be able to come into force until after the two-year period.
“We have already had contacts with third countries and they want to know what will be the nature of the relationship between the EU and the UK,” he said.
Barnier went on to hint the cost of the final Brexit bill – an estimated €45 billion (£39 billion).
Since the referendum, the EU negotiator has said he regrets the British decision to leave the EU. He said “the decision would have consequences – human, social, economic, fiscal, financial, technical, judicial. I have always recommended that no one should underestimate them.”