EU unlikely to offer Britain the ‘Swiss model’

Sir, In considering the alternatives to EU membership available to Britain, Martin Wolf criticises the “Swiss model” (“Britain after Brexit would sacrifice access for independence”, Comment, May 14).

But he is not critical enough. He writes that Switzerland “still [enjoys] favourable access to EU markets in financial services”. It does not. Switzerland’s bilateral agreements with the EU do not cover financial services, except for some life assurance business. Thus, while UK-based banks currently have “passporting” rights — enabling them to do business all over the EU while being UK-regulated — Swiss banks do not.

In any case the EU would not offer this option to a post-Brexit Britain, since it regards the Swiss model as broken. The EU has told Switzerland that it cannot have any more bilateral agreements unless it accepts greater authority for EU institutions, including the Court of Justice.

However, the EU would be relaxed if the UK asked for either the Norwegian model of European Economic Area membership, or the Canadian model of a free trade agreement; or if the British simply decided to rely on World Trade Organisation rules.

Charles Grant

Director

Centre for European Reform
London SW1, UK