The European financial markets can continue to use three major British service providers in the event of a no-deal break. The temporary permits are required by European supervisor ESMA to monitor financial stability within the EU.
If the British leave the EU without proper agreements with Brussels, three so-called clearing houses from London can still serve customers across the Channel. These are LCH Limited, ICE Clear Europe Limited and LME Clear Limited. These parties guarantee derivative transactions between, for example, pension funds, banks or asset managers. This makes them vital for smooth trade in financial products.
Great Britain, and capital city London in particular, is an important international hub for trade in financial products. Regulators such as the Netherlands Authority for the Financial Markets (AFM) have long pointed to the problems that may arise if this center is no longer subject to European legislation. ESMA is still in a way to ensure access to other major financial service providers for European parties.