Switzerland-EU stock row: London Stock Exchange could suspend trading in Swiss stocks

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The primary stock exchange in the UK announced it will be forced to suspend Swiss shares for trading with effect from July 1, 2019, if the two sides cannot reach a last-minute agreement. Brussels has threatened to block access for Swiss stock exchanges when their trade deal comes up for renewal at the end of June. The two sides have so far failed to reach a compromise over their future partnership, which currently sees Swiss bourses have free access to the larger EU market thanks to their special status. A notice released by the LSE warned the political standoff could also impact traders in the UK, with as many as 254 equity securities issued by Swiss companies.

Similar warnings have also been issued by exchange operators Aquis Exchange, CBOE Global Markets and UBS.

The European Commission said on Tuesday it has had no contact with Switzerland in the past few days and offered no update on a meeting from last week.

A spokeswoman told a news conference: “There have not been any contact.”

But she added Brussels remained open to finalising the overall partnership treaty with Bern by the end of October.

The current arrangement between Brussels and Bern will automatically expire on June 30, 2019, after the EU failed to propose an extension.

The EU executive had until June 21 to decide on keeping the partnership going.

The Commission wants Bern to agree to a deal on its overall relations with the bloc, which is focused around shared trading rules.

In a meeting of top negotiators on June 12, Brussels offered Switzerland clarifications on key issues raised by Bern on future relations.

But Swiss Foreign Minister Ignazio Cassis said his nation needs more time to strike a deal and said they would not be rushing into signing a new deal.

Bern wants to ensure Swiss wages are secured, as well as the protection of citizens’ rights.

The Swiss government has proposed a new system that would require foreign stock exchanges to get Swiss permission to host trading in Swiss stocks.

Violations of the Swiss requirements could result in criminal charges and even jail.

Trading venues outside the EU would need to get a green light to carry on as before.

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