Guernsey Press

Island’s inclusion in EU talks ‘gives certainty for business’

OPPORTUNITIES exist for Guernsey’s financial sector as talks continue with the EU about future relationships.

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Allie Renison, a former government adviser on EU trade and legislative issues and current head of European Union and trade policy for the IoD, speaking at the IoD Webinar What does Brexit Mean for Guernsey’s Financial Services Sector? (29274616)

A special webinar was hosted by the Institute of Directors following the recent Brexit negotiations.

Titled What does Brexit Mean for Guernsey’s Financial Services Sector?, it was joined by Allie Renison, a former government adviser on EU trade and legislative issues and current head of European Union trade policy for the IoD.

She directed people’s attention to the trends in business readiness and the impact since 1 January when the UK’s financial services industry automatically lost the right to trade in the EU’s single market.

The sector’s future access to the EU remained uncertain and the details were still being negotiated at that point, which has led to 30-40% of businesses not being ready to adjust. They were also affected by Covid, especially larger firms due to financial safety and stability and the difference in profit margins. In turn this affected the financial services, with 17% stopping trade with the EU.

Despite tough challenges for Guernsey, she felt there was potential for opportunities.

‘Guernsey has better market access into the EU and stands more aligned with bilateral agreements it has with the EU on automatic exchange of tax information,’ she said.

Ideas such as EU-domiciled funds alignment or cooperation with the EU was put forward, however, it could result in the Channel Islands being the ‘piggy in the middle’ and there was a need for a balancing act to be maintained.

In addition, there has been mounting pressure from members of the European Parliament to add the Channel Islands to the EU’s tax haven blacklist following the conclusion of Brexit negotiations.

In Ms Renison’s opinion a cautious approach was needed to maintain a good working relationship as commercial vs political dimensions between the EU and the UK would impact on any decisions surrounding the UK’s Crown Dependencies and Overseas Territories.

Also in attendance was Jo Reeve, director of international relations and constitutional affairs for the States of Guernsey, who led the non-political side of Brexit negotiations.

In his address to attendees he updated members on the implications for the service sector and beyond. He said they continued to engage with the UK on its negotiating mandate, in particular on Guernsey’s position for what they wanted to achieve in trading negotiations, while also analysing the EU’s policy position – expected to be published around March.

‘The EU’s opening position was fairly aggressive towards us [the Channel Islands] participating in any part of their trading relationship, expressly stating in the legal text that we weren’t to participate in that trade agreement,’ he said.

‘But that was before – in terms of fishing – there was an expectation that we would give access to our waters despite not being part of the trade agreement.’

He said it had since been a rollercoaster journey, with Guernsey taking part in trade agreement discussions, including those on fisheries, as well as goods and free trade. In the wake of ongoing negotiations Guernsey now has more certainty.

‘Given the opening position of the EU we’ve become part of the negotiations and that provides certainty for businesses here and for the relationship with the EU,’ he said.

‘Where that leads our attention is towards the rest of the world and what the UK is going to do next, like in terms of entering trade agreements with other countries and us being able to participate in them as well.’