Luxembourg throws its weight behind 2nd referendum

 Luxembourg foreign minister Jean Asselborn said that the EU should facilitate any UK decision to hold a second Brexit referendum, adding that any such arrangement would need to be short-term and agreed in advance, but European elections would need to be held if the UK remained for a longer period in the EU.

Elsewhere, a new Hanbury poll reveals that UK voters support a delay to Brexit, but only if it lasts no longer than three months. Voters are sceptical about the intention behind any delay, but 47% support a short delay to continue the negotiations or ratify the deal, with 26% opposing it. A 6 month extension is opposed by 48% and a 2 year extension by 60%.

On Wednesday, it was also reported that three EU officials have said that the European Union would be ready to approve a short Brexit extension if the UK needs more time to ensure the Withdrawal Agreement is approved by the House of Commons. 

A senior EU official is quoted as saying, “If a request for a delay of the Brexit date is submitted, it would be considered favourably. An extension of a couple of months would be relatively straightforward.

The Governor of the Bank of England (BoE), Mark Carney, told the Commons Treasury select committee yesterday that the BoE is prepared to decrease interest rates in case of a No Deal Brexit to help the economy. He said, “We’ll supply the support we can … The challenge with actually doing that is that a No Deal, no-transition Brexit will be inflationary,” adding, “We’ll do what we can, but we shouldn’t oversell what we can do. 

"The thing we can do is ensure the financial system is ready.” Carney also said that the BoE will be prepared to lend money to banks weekly rather than monthly during March and April in an attempt to hinder a potential financial crisis and so that banks can continue their services efficiently even if a large number of customers were to withdraw their funds.

Meanwhile, the EU has agreed that the rules for UK financial firms to operate in the European bloc will be tightened after Brexit. The rules will mean the European Commission will have increased power to deem who will have access to EU clients. The Council said, “In particular, the Commission is charged with assessing capital requirements applicable to firms providing bank-like services.” 

After Brexit the UK financial industry will be under an “equivalence” system in which Brussels will decide if rules are on par with those of the EU and if a firm can be allowed to be based in the bloc. EU officials estimate that the new rules will apply from 2020.

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Martin Banks

Martin Banks

Martin Banks is a highly qualified journalist with many years experience of working within the EU institutions. He is an occasional, and highly valued, contributor to EU today, writing on a wide variety of issues.

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