EU chiefs have floated a proposal which would mean the UK agrees a “pay for access” deal for the economic benefits.
The idea has not yet been formally discussed, according to six EU diplomats familiar with the proposal, who suggest it will offer hope to British negotiators that national officials are willing to be flexible about the Brexit talks than the European Commission and the EU’s chief negotiator Michel Barnier.
Britain has accused Mr Barnier of being dogmatically attached to an inflexible vision of the European project.
The diplomats suggest the fact the proposal for financial services access as part of a free trade deal has not been dismissed out of hand in Brussels suggests there may be more flexibility than has been apparent up to now — so long as the UK pays.
Mr Barnier has ruled out any prospect of financial services access under the Canada-style trade agreement the UK is seeking, saying before Christmas: “There is not a single trade agreement that is open to financial services. It doesn’t exist.”
But one of the senior officials told Politico: “Saying that no trade agreement includes financial services is a good negotiating technique, but we need to be able to move beyond it.
“We need at a certain point to have a proper, real discussion looking at possible, consensual solutions.”
The “pay for access” proposal has not yet been tabled at any formal council meetings, but diplomats are now entertaining the idea unofficially – signalling their consideration for creative solutions.
A separate senior diplomat said: “Until a few months ago I would have said no, no way, but now things have changed.”
Insiders say if Britain follows through with a so-called “pay for access” deal it would benefit all member countries – as opposed to just Frankfurt and Paris.
The two european cities would lure business from Britain if London was excluded from single market access.
Other European nations would suffer from punishing the UK.
But they insist there is a reluctance among EU countries to introduce the ideal into official discussions without a first move from the UK Government.
Another diplomat said: “It’s London that has to put it on paper.”
A Government spokesman said: “It’s good news that EU diplomats are thinking creatively about how we ensure the vital services sector is covered by our future trade deal.
“But inevitably, given the level of access that the EU requires to the City of London, an obvious downside would be that payments would have to flow both ways.”