The European Commission has adopted a draft memorandum of understanding to create a framework of financial services regulatory cooperation with the UK.
If signed by both parties, the draft MoU would create an administrative framework for voluntary regulatory cooperation, including an EU-UK joint Financial Regulatory Forum, which would serve as a platform to facilitate regulatory dialogue.
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The move follows the Joint Declaration on Financial Services Regulatory Cooperation accompanied by the Trade and Cooperation Agreement signed by both the UK and EU as part of Brexit.
Mairead McGuinness, EU commissioner for financial services, financial stability and capital markets union, said: "The Windsor Framework allowed the EU and the UK to open a new chapter in our partnership based on a spirit of mutual trust and cooperation.
"I am confident that our relationship and future engagement in financial services will be built on a shared commitment to preserve financial stability, market integrity, and the protection of consumers and investors."
The MoU will not give the UK access to the EU's single market and vice versa, and it does not "prejudge the adoption of equivalence decisions", the Commission added.
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Chris Cummings, CEO of the Investment Association, said the adoption of the draft MoU would be a "major step forward in achieving closer cooperation between the UK and EU".
He added: "A close partnership between the UK and EU, which recognises the long-shared history of cooperation, can help ensure a resilient and dynamic financial services sector that benefits citizens and businesses across Europe.
"We look forward to seeing this delivered through the newly created Joint UK-EU Financial Regulatory Forum as soon as possible."
