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Davis promises City of London special post-Brexit travel regime

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Davis promises City of London special post-Brexit travel regime

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Davis promises City of London special post-Brexit travel regime

Government seeks to reassure bankers and other professionals with free movement

Britain will seek to reach an agreement with the EU on a transition deal lasting ‘around two years’, said David Davis © Bloomberg

Bankers and other professionals have been promised a special post-Brexit travel regime to allow them to move freely across Europe, as the British government sought to reassure the City of London its future was safe.

David Davis, Brexit secretary, told about 700 investors, financiers and regulators on Tuesday that Britain would also seek to reach an agreement in principle with the EU on a transition deal lasting “around two years” by January 2018 at the latest.

Mr Davis insisted London would flourish after Brexit because the EU also had an interest in having access to its expertise and deep capital markets, and because Britain would retain similar regulatory goals to the EU.

He told the UBS European conference that details of future co-operation would be agreed in exit talks, but added: “None of this should be particularly controversial when we actually get down to it.”

With negotiations currently stalled and international banks preparing to move more staff out of London to other European capitals, Mr Davis offered a new olive branch by vowing a special travel regime that would particularly benefit the City.

“We want to ensure that our new partnership with the EU protects the mobility of workers and professionals across the continent,” he said.

“Whether this means a bank temporarily moving a worker to an office in Germany or a lawyer visiting a client in Paris, we believe it is in the interests of both sides to see this continue.”

Allies of Mr Davis say intra-company transfers between offices in different European centres should be treated differently to other forms of immigration, which are likely to fall under a new British work permit system.

The scheme has yet to be agreed, but it might allow people who were posted abroad for less than three months to come and go freely. Intra-company transfers are a particular feature in the City and in professional services firms.

Meanwhile Mr Davis also said Britain was looking to agree with the EU a transition deal — lasting for “around two years” after Brexit day in March 2019 — at or shortly after a European Council meeting in Brussels next month.

“Boards have to meet their fiduciary duties and investors need to make decisions critical to the future of their companies,” he said. “Without such an implementation period, some of these decisions would need to be taken in January 2018.

“That is why we want to agree this period as soon as the EU have a mandate to do so, which I believe can be done very early next year.”

Senior EU officials believe an in-principle deal is possible by December, which would see Britain agree to divorce terms at the same time as the EU adopts “guidelines” outlining its conditions for a transition deal, but details would take longer to agree.

William Hague, former Conservative leader, wrote in the Daily Telegraph on Tuesday that Britain should offer to pay its share of the EU’s €240bn in outstanding commitments to unlock the exit talks. “Anyone who thinks there has ever been a chance of a free-trade deal with the EU without doing this has been kidding themselves,” he said.

But Manfred Weber, the German centre-right MEP who leads the European Parliament’s biggest group, said ahead of talks with Theresa May in Downing Street on Wednesday: “In December, it doesn’t look like negotiations are going to move on to the second phase to talk about the future.”

Michael Bloomberg, former mayor of New York, said London would suffer because of the UK leaving the EU but remain Europe’s financial hub for the “foreseeable future”. He recently labelled Brexit “the single stupidest thing any country has ever done”.

Letter in response to this article:

Special travel regime for the City is clearly unjust / From Caroline Lucas MP, Green Party, House of Commons, UK

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