The International Regulatory Strategy Group (IRSG), described as an “elite taskforce” of City experts, has drawn up plans for post-Brexit trade deal which calls for “continued high levels of convergence” with London and Brussels.
A report published today says the “bold and ambitous plan” proposes “the best concepts from existing free trade agreements (FTAs) but goes far beyond them in scope and ambition”.
Other suggestions include the creation of a joint dispute resolution body, and a forum for both London and European businesses to work together on developing new global standards.
The plan is bring backed by the influential Treasury Select Committee, chaired by former education secretary Nicky Morgan.
She told City AM: “The City and our financial institutions are major taxpayers and employers.
“If the government is serious about London staying as Europe’s pre-eminent financial centre, they need to listen to these constructive suggestions and work with the authors of the report and EU counterparts to deliver this agreement.”
Were the government to adopt the plan, it would mean financial and professional services based in the UK would still be able to work within the EU in a recipricol, two way deal.
IRSG chair Rachel Kent said the plan could only work if both sides took a flexible approach and the relationship was regularly and properly scrutinised.
“Continued high levels of access is reliant on continued high levels of convergence,” she said.
A full list of detailed proposals will be published in Brussels when the IRSG embarks on a European tour hoping to convince the remaining 27 EU member states to retain strong ties with London after Brexit.
It comes as European Council President Donald Tusk said not enough progress had yet been made in the Brexit divorce talks to move on to trade negotiations.
Describing Brexit as an exercise in “damage control”, he said: “I feel now we will discuss our future relations with the UK once there is so-called sufficient progress.
“The two sides are working and we will work hard at it.
“But if you ask me, and if today member states ask me, I would say there is no sufficient progress yet. But we will work.”
Speaking to reporters after a meeting with Theresa May, Mr Tusk said: “I feel cautiously optimistic about the constructive and more realistic tone in the Prime Minister’s speech in Florence and of our discussion today.
“This shows that the philosophy of having a cake and eating it, is finally at an end … at least I hope so. That’s good news.”
A Downing Street spokesman said Mrs May and Mr Tusk had “welcomed the good progress” that has been made on citizens’ rights in the negotiations.
The spokesman said: “At the end of the meeting, the PM said her Florence speech had been intended to create momentum in the ongoing talks. She said it was important for EU negotiators to now respond in the same spirit.”
While posing for photographs with Mr Tusk at the beginning of the Downing Street meeting, Mrs May said the two leaders agreed that “things have moved on” in the Brexit process.
The PM stressed the need for a “good economic and security partnership” between the UK and EU after withdrawal.
The Talks came after the fourth round of negotiations on the UK’s withdrawal from the EU began in Brussels on Monday.
Brexit Secretary David Davis has insisted there are “no excuses” for blocking progress to trade talks.