EU threatens City of London access in move to force bankers to Continent after Brexit

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The European Central Bank insisted firms could no longer use the coronavirus pandemic as an excuse to put off relocating their operations and staff to the bloc’s main financial centres. EU bankers have long wanted the Frankfurt-based institution to put the squeeze on Boris Johnson to help snatch away business from the City. The bloc’s main hubs, such as Frankfurt and Paris, had hoped Brexit would spell the end as London’s status as one of the world’s leading financial hubs.

In order to continue offering services in the EU, British bankers were told they had to move sufficient capital and staff to the Continent.

The ECB said: “Banking supervision has provided flexibility where required, notably to account for impact of the lockdown measures and travel restrictions on the relocation of staff.

“No additional flexibility is foreseen in principle.”

Meanwhile EU leaders will tomorrow put no deal Brexit on the table in a direct challenge to Boris Johnson in a bid to unblock the trade talks.

Leaders will order up a raft of new emergency preparations in a warning that wrangling over the future relationship is “within days” of collapse.

Brussels sources claimed they will use their video conference on Thursday evening to signal it is now time for the bloc to be “operating in a no-deal scenario”.

Insiders said the move was an attempt to shock the Prime Minister into a series of last-minute concessions on future fishing rights and state aid rules.

One source told “You can expect strong words from the leaders that the EU will be within days of operating in a no-deal scenario.”

And a senior EU diplomat added: “Of course this sends out a political signal. This is a sign that we are really going to prepare.”

EU negotiator Michel Barnier has been locked in intensive discussions in Brussels with UK counterpart Lord Frost.

In a downbeat briefing to top eurocrats, the Frenchman today warned disagreements over access to Britain’s coastal waters and common standards were still blocking any significant progress.

European Commission vice-president Valdis Dombrovskis told a news conference there was still “substantial work to do” before any breakthrough can be announced.

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He added: “We are now in the last moments, we have seen many deadlines come and go but there is one we’ll not be able to move and that’s January 1.”

European capitals are keen to find solutions for the main sticking points while negotiators finalise the details of the 80 percent of the Brexit trade deal already agreed.

But France was still refusing to drop its hardline demands for almost the same level of access to Britain’s fishing grounds.

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A Brussels source said Paris will block any agreement that doesn’t “preserve the interests of EU fishermen” in UK waters.

President Emmanuel Macron has already torpedoed a compromise offer put forward by Mr Barnier in a bid to break the deadlock.

An EU official described the intensive wrangling over the post-Brexit trade deal as “Groundhog Day” for the bloc.

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