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[...]Senior representatives from the financial services industry, who met Brexit secretary David Davis last week, were also told that for a transition period immediately after leaving the EU the government would try to ensure that the sector saw benefits from a “standstill” deal with all existing cross-border agreements remaining in place.
However, Mr Davis believes that if Britain maintained the same regulatory framework for financial services as the EU in the long term — without having any influence over its composition — this would erode any competitive advantage the UK-based industry would gain from being outside the bloc. [...]
According to three people with knowledge of last week’s meeting between the government and business, Mr Davis has come into line with chancellor Philip Hammond in proposing a standstill period of two to three years after March 2019 during which the existing UK-EU relationship would be broadly maintained. [...]
However, people at the Chevening meeting said Lord Hill argued that, although the UK should remain aligned to global financial regulation, it would be wrong for Britain to be irrevocably tied after the transition period to an EU legislative framework over which it had no control. [...]
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