British banks and EU-based customers after Brexit - what the government say

Many of the big British banks have been contacting customers over the past weeks to inform they will stop serving them when the withdrawal agreement ends on December 31st this year. The Treasury has provided the following answer to a question submitted by MP Sir Roger Gale regarding this matter.

Question:
To ask the Chancellor of the Exchequer, what steps he is taking to ensure that (a) passporting arrangements and (b) banking facilities used by UK citizens resident in the remaining EU 27 countries will be maintained after the 31st December 2020. 

Answer:
The UK has consistently been clear that we want an agreement with the EU that reflects the maturity of our financial services relationship.

The EU’s financial services passport is not available for firms based in countries outside of the EU and the EEA as they are based on the single EU rulebook for financial services. The UK is leaving the Single Market, and therefore is not subject to the passport. The UK has taken a pragmatic approach to the future relationship on financial services, and has been clear that politicisation of equivalence is in no-one’s interests.

The UK authorities have taken all the action we can to mitigate risks of disruption to cross-border financial services at the end of the Transition Period (TP), including confirming that the Temporary Permissions Regime will apply from the end of the TP. It will allow EEA firms currently providing services in the UK via a financial services ‘passport’ to continue operating after the TP while they apply for full UK authorisation.

But whether UK firms can service EEA-based retail customers remains a matter of local law and regulation in each country. We expect banks to act lawfully and in accordance with local regulators’ expectations.

We also expect that banks work to ensure good outcomes for their customers and provide timely communications to enable them to make appropriate decisions and take necessary steps. If customers are concerned then they should speak to their provider.

Answered by John Glen

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