EU document suggests trouble for Swiss access to European finance markets

Bern is locked in negotiations with the EU Commission, based in Brussels. Keystone

An EU document seen by Swiss public television, SRF, suggests that Brussels may be planning to place a conditional limit of one year on the ‘equivalence’ of the Swiss and European stock exchanges – an essential measure for Swiss financial trading.

The internal document, also seen by Swiss news agency ATS, reveals that the financial equivalence mechanism for Switzerland, which allows for cross-border trading on equal terms, was approved by the EU countries, but with a conditional limit of one year.

If nothing changes, the implication would be that the Swiss stock exchange would lose the equivalence with its European counterpart on December 31, 2018.

Other countries, including Hong Kong and the US, have received the recognition for an unlimited period, something the Swiss were said to have also expected to fall to them.

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Contacted by ATS, the EU Commission in Brussels declined to comment on the time limit.

The draft paper “is currently in consultation with the Member States”, it said. According to information in the document, EU states have until Wednesday 20th December at 17:00 CET to raise objections – otherwise the one-year stipulation will tacitly come into effect.

The motives behind the move appear to be part of a larger negotiation game between Switzerland and the EU, who are currently attempting to firm up a web of bilateral legislative agreements to regulate relations.

Switzerland wants to finalise these agreements by the end of 2018, a date which, according to ATS, may be related to the one year equivalence timeframe pushed by the Commission.

The move comes not long after Swiss finance minister Ueli Maurer demanded that a CHF1.3 billion ($1.32 billion) ‘cohesion payment’ by Switzerland to poorer EU countries be made only on condition that Switzerland received a promise of financial equivalence.

Asked about the issue on Swiss television Monday evening, President Doris Leuthard said that the government would await the EU Commission’s decision before taking any measures.

swissinfo.ch and agencies/dos