The European Union will likely grant Swiss stock exchanges — SWX Swiss Exchange and BX Swiss AG — a one-year access to its internal market, EU sources told Reuters.
EU states will vote Dec. 20 to recognize equivalence between shares trading on the Swiss stock exchanges and those trading on EU-based bourses, the newswire noted in a Dec. 19 report. Reuters said the move is designed to put pressure on the Swiss government to strike an overall deal with regards to its relationship with the EU.
The proposal will temporarily allow EU investors to access the Swiss exchanges and vice-versa, avoiding complications once the revised Markets in Financial Instruments Directive, or MiFID II, takes effect in early January. It will also make way for a general deal by 2018-end on Switzerland's access to the EU market, according to an EC official.
Documents seen by the newswire also revealed that the EC had initially proposed an adoption of equivalence for the Swiss exchanges for an indefinite period, in line with a deal on U.S. trading venues. However, the EC put the offer on review due to Switzerland's reluctance to sign a general deal, sources said.
Such an "institutional agreement" would grant Switzerland easier access to EU single market in exchange for more closely aligning with EU rules and making broader commitments to the bloc, Reuters noted.