Brexit: Five things we learnt this month - January
A round up of this month's biggest Brexit news.
1. Financial services firms and banks consider leaving London
Since the vote to leave the EU in June last year, banks and other financial institutions have been weighing up the pros and cons of moving operations out of The City.
In late December 2016, the City of London Corporation urged the Prime Minister to announce transition agreements “as soon as possible” in an attempt to put businesses at ease.
However, banks are clearly still jittery at the prospect of a hard Brexit leading to the loss of passporting rights.
Citigroup, the American investment banking and financial services corporation, has set out a list of 25 criteria to decide which of the 27 EU member states it should move its operations to post-Brexit.
It has also been reported that the French finance minister Michel Sapin met with senior executives of Goldman Sachs, Bank of America, UBS and Citigroup in order to pitch Paris as Europe’s next financial centre after the UK triggers Article 50.
2. The UK is leaving the single market
After months of speculation, Theresa May confirmed that the UK will leave the European single market when it leaves the EU.
During a speech on 17 January, the Prime Minister said that the UK “cannot possibly” stay in the single market, saying it would be like “not leaving the EU at all”.
As an alternative to the single market, the Prime Minister will be seeking the “greatest possible access to it” by negotiating free trade agreements with the remaining EU member states.
She went on to say that she wants to ensure that relations between the UK and the EU remain amicable, and that any member states attempting to pursue a bad trade deal to punish Britain would be “an act of calamitous self-harm for the countries of Europe, and it would not be the act of a friend”.
Source: CA Today
3. Supreme Court rules on Article 50
MPs will vote on whether the government can proceed with triggering Article 50 to begin the two-year process of Britain’s exit from the EU, the Supreme Court has ruled.
Parliament will need to vote before the government's self-imposed Article 50 deadline of 31 March.
Gina Miller, an investment manager and one of the campaigner who brought the case to the High Court, said that the judgement was “not about politics, but process”.
After the ruling the government made it clear that it would not impact the process of Brexit, with Brexit secretary David Davis saying: “It's not about whether the UK should leave the European Union. That decision has already been made by people in the United Kingdom."
He said there would be “no turning back”. Adding: "The point of no return was passed on 23 June last year."
Source: BBC News
4. ICAS forms the Brexit Advisory Group
The Brexit Advisory Group has been established to understand members’ concerns, represent their views and interests, and assist them in understanding the impact of key issues on themselves and their organisations.
The Group will contribute to and oversee the development of ICAS’ views in relation to the withdrawal of the UK from the EU, including:
- The identification of opportunities and challenges arising from the UK decision to leave the EU.
- The selection of specific opportunities and challenges arising from Brexit which the Group believes it should develop to support ICAS’ aims.
- To comment on policy developments and any risks of unintended consequences, where relevant (UK, Scotland and Europe).
The group is made up of CAs, business leaders, peers, academic leaders and ICAS staff members, and is chaired by Mike McKeon CA.
5. A UK-US trade deal on the horizon?
Britain will be at the “front of the line” when it is possible to negotiate trade deals with the US, aides to Donald Trump told Foreign Secretary Boris Johnson earlier this month.
The statements, made before Trump was inaugurated, may be sincere as Theresa May will be the first foreign leader to meet with the new president.
Speaking in parliament about the planned visit, the Prime Minister said: “We will be looking for a UK-U.S. trade deal that improves trade between our two countries that will bring prosperity and growth to this country...and I can assure...that in doing that we will put UK interests and UK values first."
However, economists have said that the upsides of a UK-US trade deal would be “very small” and would be outweighed by the losses incurred when Britain pulls out of the single market.