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Brexit: End of May, start of June

Despite loud protest and prior insults on both sides, the President of the United States Donald Trump visited the UK for a state visit on 3 and 4 June. After a state banquet on Monday, Trump met Prime Minister Theresa May on Tuesday. On Brexit he recommended the UK to walk away from talks with Brussels and to refuse to pay Britain’s agreed divorce bill. Furthermore, Trump said that a big trade deal with the UK would be possible if the UK will eventually leave the EU during a business breakfast meeting with five top companies each from Britain and the United States.

This will be the last state visit for May because she will leave Number 10 this Friday 7 June. The leadership race has already started with more than 10 Conservative MPs indicating their wish to succeed May. Normally, the whole process would take a few months but due to the lack of time to find a Brexit deal, the Conservative Party introduced new rules, including measures to eliminate candidates more quickly. The Conservative Party wants to finish the leadership race before the end of July so the new Prime Minister will have (only) three months before the Brexit day on 31 October. A new Prime Minister and new leader of the Conservative Party is expected to be announced in the week of 22 July. Boris Johnson seems to be the leading contender and already said that the UK will leave the EU on 31 October with or without a deal.

On the other side of the Channel a document was leaked this week with the new priorities for the next Finance Commissioner. A new strategy for the capital markets union, fintech, financial stability, sustainable economy and Brexit are key points for the next 5 years. Concretely for Brexit, the Commission officials recommend looking into the right balance between the EU and non-EU financial services. This would include the monitoring of the recognition of non-EU financial frameworks (equivalence decisions). The EU executive will also assess the autonomy of the EU financial infrastructure and important European financial players.

What’s next?

In the coming weeks UK politics will mainly focus on the Tory leadership race, and therefore also on their specific positions regarding Brexit. The question is, will the new leader of the Conservative Party and Prime Minister be a moderate Brexiteer as May or a hard Brexiteer and, therefore, even determined to leave the EU without a deal.

At the end of June there is also an EU Summit. French President Emmanuel Macron has already made clear that he wants to move on with the EU and, therefore, reopening negotiations on Brexit will not happen. 31 October remains the final deadline.