On November 20, the European Commission published a speech on the future of the European Union given by Michel Barnier, the EU’s chief Brexit negotiator, at the Centre for European Reform.

In the Speech, Mr. Barnier focused on Brexit and identified three keys to the European Union building a strong partnership with the United Kingdom:

• agreement on the terms for the UK’s orderly withdrawal from the European Union, especially in relation to citizens’ rights, financial settlement and the Irish border;

• maintenance of the integrity of the EU’s Single Market; and

• a level playing field between the European Union and the United Kingdom.

On the second bullet point, Mr. Barnier referred specifically to the financial services sector and commented on the contradiction of beliefs in the United Kingdom between those who believe the United Kingdom will “set itself free” of EU bureaucracy and those who claim it will still be possible to participate in the EU’s Single Market. Mr. Barnier went on to state that, in his words, the “legal reality” is that ending the free movement of people, one of the four indivisible freedoms of the European Union, means that the United Kingdom will lose the benefits of the Single Market. Furthermore, in relation to financial services, Mr. Barnier definitively stated that “Brexit means Brexit, everywhere,” and that the legal consequence of Brexit is that UK financial service providers will lose their ability to easily provide services cross-border into the EU, known as the EU passport.

However, Mr. Barnier went on to say that the European Union will “have the possibility to judge some UK rules as equivalent,” based on a proportional and risk-based approach, and in those areas where EU legislation foresees equivalence.

The speech is available here.