Michel Barnier has warned that Britain will lose access to financial passporting after Brexit, which is relied on by over 5,500 UK businesses to access EU markets.

The European Commission’s Brexit negotiator implied that loss of financial passporting could be avoided if the UK government chose to stay in the single market, saying that “the integrity of the single market is not negotiable.”

Previous research has found that a Brexit deal that did not include financial passporting could lead to £10bn in lost tax revenue and up to 35,000 job losses.

Liberal Democrat Leader Vince Cable commented:

“This is a major blow to the government’s Brexit plans.

“Over 5,000 UK businesses and billions of pounds of tax revenue depend on access to European markets through financial passporting.

“Loss of this access risks blowing a hole in the budget at a time when our public services are already seriously underfunded.

“All of this could be avoided if the government chose to stay in the single market.

“Instead ministers seem intent on killing the golden goose, by choosing an extreme form of Brexit that will seriously damage the financial sector.”

Notes:

Figures released by the Financial Conduct Authority (FCA) show 5,476 UK-registered companies use passports to access the EU market
https://www.parliament.uk/documents/commons-committees/treasury/Correspondence/AJB-to-Andrew-Tyrie-Passporting.PDF

Research by TheCityUK estimates a Brexit deal without financial passporting could lead to a loss of around £10 billion of tax revenue a year and up to 35,000 jobs
https://www.thecityuk.com/assets/2016/Reports-PDF/The-impact-of-the-UKs-exit-from-the-EU-on-the-UK-based-financial-services-sector.pdf