UK Finance has called for a new strategic partnership between the UK and European Union on financial services and published a roadmap that aims to strengthen cooperation and reduce barriers a decade after the Brexit referendum.

Produced in partnership with law firm Freshfields, the report urges both the UK and the EU to place financial services at the centre of discussions during upcoming summits.

The financial services trade body argues in the report that financial services remain a key driver of growth, investment and economic resilience across both economies, but the current institutional relationship falls short of its potential.

The report outlines a three-stage roadmap designed to improve cooperation while respecting the UK's and EU's separate regulatory frameworks.

In the short term, UK Finance wants policymakers to strengthen the existing UK-EU Memorandum of Understanding by turning the Joint Regulatory Forum into a platform for active coordination rather than information sharing.

It also calls for financial services to become a standing item at annual UK-EU summits and for greater certainty around cross-border market infrastructure and data flows through permanent central counterparty equivalence and the removal of the sunset clause on the EU's UK data adequacy decision.

The medium-term recommendations focus on reducing operational friction between the two markets. These include a mobility agreement for skilled financial services professionals, action to address regulatory gaps linked to the EU's Capital Requirements Regulation, and the creation of joint innovation initiatives such as a UK-EU regulatory sandbox and competitiveness lab.

Longer-term ambitions include a formal UK-EU Financial Services Agreement modelled on arrangements between the UK and Switzerland, and the development of a broader pan-European capital markets framework spanning the UK, EU, European Economic Area and European Free Trade Association countries.

Kerstin Mathias, director of international affairs at UK Finance said the UK and EU have a well-connected financial landscape and there is an opportunity to improve how the UK and EU realise the full potential of their relationship.

"This is not a call for reintegration into the Single Market – the EU is a sophisticated bloc pursuing its own ambitious agenda and the UK, likewise, has its own regulatory framework, policy priorities and global commitments,” she added. “But the two highly connected economies can achieve more where we cooperate.

“The question is not whether to work together, but how to do so more effectively."

---