European Affairs Committee
The UK-EU relationship in financial services

1st Report of Session 2022-23 - published 23 June 2022 - HL Paper 21



Chapter 1: Introduction

This inquiry

Financial services in the UK

Brexit and financial services: a brief recap

What the trade data says

Job and business moves

Fragmentation of the EU financial services sector

Asset and infrastructure moves

UK Government policy for the future of financial services

Chapter 2: Equivalence


The state of play

UK equivalence decisions

EU equivalence decisions

Explaining the lack of EU equivalence decisions

The importance of EU equivalence decisions

The impact of the ‘imbalance’ in equivalence decisions between the UK and other third countries

Chapter 3: Regulatory cooperation

Background: the UK-EU Memorandum of Understanding

The importance of the Memorandum of Understanding

Bilateral and multilateral cooperation between regulators

Political and diplomatic cooperation

Chapter 4: Regulatory reform and divergence

Onshoring of EU legislation

Box 1: The role of the UK regulators

The Future Regulatory Framework Review

A competitiveness objective

Scrutiny and accountability of regulators

Regulatory alignment and divergence

Table 1: Status of selected UK financial services regulatory reforms, May 2022

Planned UK regulatory reforms

The Listings Review

Wholesale Markets Review

Solvency II Review

Further UK-driven divergence

EU-driven divergence

International standards

Data adequacy

Box 2: Data adequacy explained

Chapter 5: Opportunities


Green finance

Approaches to securing market access

The labour market

The importance of openness

Summary of conclusions and recommendations

Appendix 1: List of Members and declarations of interest

Appendix 2: List of witnesses

Evidence is published online at and available for inspection at the Parliamentary Archives (020 7219 3074).

Q in footnotes refers to a question in oral evidence.

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