On 21 December 2023, the UK Government announced that it had signed a ‘ground-breaking agreement’ with Switzerland to enhance cross-border market access of financial services between the two countries. The Berne Financial Services Agreement provides an institutional framework for cooperation and development of the UK’s financial services relationship with Switzerland. The foundation of the agreement is a shared commitment to openness and commercial competition; regulatory and supervisory cooperation; and well-regulated markets. The agreement sets sectors where the UK and Switzerland will mutually recognise each other’s domestic laws and regulations on financial services, making it easier for corporate and high net worth clients in the two markets to do business with each other. Further information regarding the benefits of the agreement can be found in the HM Treasury document, The Berne Financial Services Agreement: Benefits for the UK.
In terms of next steps for the UK:
- The Financial Services and Markets Act 2023 contains a power which allows the UK Government to give effect in domestic law to mutual recognition agreements relating to financial services via statutory instrument.
- This gives HM Treasury the power to make the necessary changes to domestic legislation to ensure that the agreement can be fully implemented. This includes granting any additional powers to the UK’s financial services regulators, as required.
- HM Government will seek to implement and ratify the agreement in due course, in line with UK domestic parliamentary processes.
Separate to the Berne Financial Services Agreement, the UK is also currently negotiating an enhanced Free Trade Agreement with Switzerland.