A document drawn up by Linklaters, Freshfields Bruckhaus Deringer and Clifford Chance has proposed that banks in Britain may have grounds to take legal action against the European Union if they are denied are staggered exit from the EU trading bloc. Citing a variety of laws including the Vienna Convention of the Law of Treaties, the document argues that banks are legally entitled to a degree of ‘legal certainty’ and regulatory stability under ‘acquired rights’ that cannot suddenly be withdrawn. ‘EU law cites a number of different bases for requiring transition arrangements,’ the document reads. ‘A failure to do so could possibly create an entitlement for an affected EU firm to take action against the commission.’  

Britain’s banks are reportedly hoping for a transitional agreement under which current legal and regulatory arrangements would be kept intact for at least five years after the country’s exit from the European Union. Such an agreement would buy time for financial institutions hoping to move some or all of their UK-based operations to the European continent should British companies lose passporting rights after Brexit is complete.

Sources: Reuters; The Independent