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Passporting tops the Brexit wishlist for financial services firms

Hayley Kirton
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Investment banks in particular want to secure passporting rights (Source: Getty)

Securing passporting rights is the main Brexit concern of the financial services sector, research out today has found.

The study by professional services firm EY found that over two-thirds (68 per cent) of all policy wishlists financial services firms have made public following June's vote have made reference to maintaining passporting for goods and services.

The proportion which are publicly hoping to retain passporting increases to 80 per cent among major investment banks. Meanwhile, three-quarters of the investment banks which have spoken out about passporting have also warned they might need to relocate or review their operations if the rights cannot be secured in the Brexit negotiations.

Read more: Passporting for financial hubs works both ways, watchdog numbers show

"The message from the investment banking community – particularly from the large global and European institutions – is clear: access to the single market and the passporting of products and services will be fundamental to their decision making regarding their ongoing presence, scale and investment in the UK," said Omar Ali, UK financial services leader at EY.

However, the situation is not quite so clear cut among fintech firms. Of the 28 firms monitored by EY, nine have spoken out about what they want government to prioritise in the Brexit negotiations. Of those, seven have spoken of the important of freedom of movement, but just six have stressed the importance of passporting.

Read more: The City will survive without EU passporting rights

"Fintech firms rely on access to skilled labour – this was already top of their concerns when we did the study of the UK fintech market for the Treasury, well before the referendum," Ali added.

"The good news is that Brexit could actually help them get greater access to talent if people are treated equally irrespective of which country they come from.

"The UK has developed a reputation as a centre for fintech excellence and innovation and we should make sure that, in all the moving parts during the course of the negotiations, we don’t miss the opportunity to build on our position as a global market leader."

Figures revealed last month in a letter from the Financial Conduct Authority showed that 13,484 firms currently rely on some form of passporting right to either access the UK market from elsewhere in the EEA or vice versa.

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