London and Brussels have agreed a preliminary deal that would see British financial services retain access to European Union markets after Brexit, The Times newspaper reported Thursday.
British and EU negotiators have struck a tentative agreement on all aspects of a future partnership on services and the exchange of data, the daily said, citing UK government sources.
Such a deal would guarantee British companies access to EU markets as long as domestic regulations remained broadly aligned with those set by Brussels.
The pound started to rally against the dollar following the publication of the report at midnight (0000 GMT).It stood at a weekly high of about $1.29 around 0730 GMT.
Financial services are a major part of Britain’s economy and access to European markets has been a key concern in the Brexit negotiations.
Currently, the EU would be able to withdraw market access with a month’s notice if it decides that a partner country no longer has equivalent financial services regulations.
The report in The Times suggested that neither London nor Brussels would be able to declare unilaterally that regulations had fallen out of equivalence and block access to their markets without first going through independent arbitration and a notice period significantly longer than one month.
Britain’s Brexit minister Dominic Raab believes a divorce deal with the European Union could be struck by November 21, it emerged Wednesday, prompting EU leaders to warn this would require a breakthrough within days.
In a letter to a parliamentary scrutiny panel, he wrote: “I would be happy to give evidence to the committee when a deal is finalised, and currently expect 21 November to be suitable.”
But Raab’s ministry later admitted there was “no set date for the negotiations to conclude”.
Most of the divorce deal with Brussels is agreed but talks remain stuck on how to avoid new checks on Britain’s land border with EU member Ireland after it leaves the bloc’s single market and customs union.