Brexit warning: Brussels could block Switzerland’s access to EU’s financial services market Brussels could be set to fire a warning shot across Brexiteers’ bows amid expectations it could block Switzerland’s access to […]

Brussels could be set to fire a warning shot across Brexiteers’ bows amid expectations it could block Switzerland’s access to the EU’s financial services market.

The European Commission is expected to take a hard line with Bern by cutting off Swiss stock exchange access to the EU market and send a “crystal clear” message to Britain that it is not prepared to compromise on Brexit, it is claimed.

Swiss access to the single market is governed by a system known as “equivalence”, which expires at the end of July and would need to be renewed.

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But the Commission has said it would renew only if the Swiss made progress towards an overall EU-Swiss agreement to replace the current patchwork of individual deals, according to reports.

British financial services’ access to the EU would also be governed by equivalence under the terms of the Brexit Withdrawal Agreement.

A document presented to the commissioners’ weekly meeting said: “We simply cannot accept further attempts at foot-dragging and watering down internal market rules, especially in what is probably the decisive phase regarding Brexit.”

It added: “An expiry of ‘equivalence’ may be just the warning shot across the bow they need.”

Michel Barnier, the EU’s chief negotiator, this week rejected a plea Stephen Barclay, the Brexit Secretary to discuss adopting parts of the Withdrawal Agreement that guarantee citizens’ rights even if an overall agreement cannot be reached.

According to the Times, Mr Barclay said both sides should work to protect the pensions, healthcare and residency rights of the three million EU citizens and the 1.3 million Britons in the EU “in all scenarios”.

‘Carve up’

But Mr Barnier rejected the call to “carve up” the withdrawal deal amid worries in Brussels that the move would encourage the idea of a “managed no deal” among Brexit-supporting Prime Ministerial candidates.

“Our joint efforts should remain focused on making sure that the withdrawal agreement will be ratified and will enter into force,” he wrote in a letter to the government.

Swiss-EU relations suffered in 1992 when Swiss voters rejected joining the European Economic Area, leading to a negotiated patchwork of 120 accords that now govern ties.

The Swiss government has said it will retaliate with measures to defend Swiss stock exchanges if the EU blocks their access to its investors.