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UK policymaker says firms will benefit from Brexit transition agreement

Updated: 07 19 , 2017 13:45
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LONDON, July 18 -- A senior British policymaker has said businesses need the help of a transitional arrangement for market regulations as Britain moves closer to Brexit.

Andrew Bailey, the chief executive of the Financial Conduct Authority (FCA), said on Tuesday that UK-based firms have been drawing up plans for post-Brexit days and are soon reaching the point where they would have to begin implementing the plans.

Firms are looking to implement their Brexit plans towards the end of this year.

"I think it (the exact date) differs from firm to firm, depending on the nature of the plan," Bailey told the press conference at the FCA's annual meeting in central London.

Bailey said that firms in the financial sector would benefit from an agreement to draw up a transitional arrangement. The UK is unlikely to leave the EU suddenly at the end of March 2019, but is expected to continue to respect EU rules and legislations until an agreed date.

"An agreement on a transitional period would break that constraint," said Bailey.

"Firms are in the position where they have to start their plans without knowing what the outcome of the eventual negotiation is," he added.

Brexit negotiations between Britain and the European Union (EU) have reached their second round in Brussels this week.

The two-year deadline for negotiations was set into operation when British Prime Minister Theresa May triggered Article 50 to leave the EU at the end of March.

Last week, Bailey gave a speech at Reuters in London where he said that he sought a commitment from all sides that the UK and the EU maintain substantially equivalent regulatory arrangements in future.

This means that it would not be necessary to restrict open markets and free trade in financial services and therefore not necessary to limit the freedom of companies to choose their locations.

Brexit does not need to mean sacrifices of open financial markets and free trade, said Bailey.

The FCA is a British financial market regulatory body, overseeing the work of 36,000 firms with an aim to protect consumers and financial markets.

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