Theresa May. Picture: REUTERS
Theresa May. Picture: REUTERS

London — Prime Minister Theresa May defended her decision to rule out passporting rights for banks after Brexit, saying Britain could not become a "rule taker" in financial services.

She said this in an interview broadcast on Sunday, but recorded on Friday after a speech in which she appealed for flexibility from the bloc. May said her vision for future ties to the EU was a credible one and she was confident of reaching a good Brexit deal.

Setting out her thinking in more detail, May said that the financial-services sector was too important to the British economy for Brussels to retain control of it under the existing passporting arrangement. Passporting rules allow EU finance companies to sell their services across the 28-member bloc with a local licence, rather than getting a licence for each country where it does business.

"If we were to accept passporting we’d just be a rule taker, we’d have to abide by the rules that were being set elsewhere," May said in the interview with the BBC. "Given the importance of financial stability, of ensuring the City of London, we can’t just take the same rules without any say in them," May said.

The Confederation of British Industry lobby group said it was important to ensure alternative arrangements were in place to prevent firms leaving London.

"Now we do have an opening negotiating position. It needs to be followed through, it needs to be followed through very quickly because financial services firms are moving now," said confederation director-general Carolyn Fairbairn.

May wants financial services to be included in a free-trade deal — something she says is still possible, despite accusations from Brussels that her approach amounts to "cherry-picking" the best bits of the EU.

"I’ve said before that no deal is better than a bad deal, but I’m confident that we can get a good deal, and get the right deal for the British people," May said.

"If we look at our future prosperity and security, in the UK and in the other 27 countries, actually the right deal for us will be the right deal for them too."

May’s speech on Friday was well received in Brussels and among rival factions of her Conservative Party. But, underlining the challenge May faces, Ireland’s foreign minister, Simon Coveney, said on Sunday she still had to spell out her approach to the Irish border. "She hasn’t really gone into any more detail than we’ve already heard in terms of how she is going to solve the problem of maintaining a largely invisible border on the island of Ireland."

Scotland’s first minister Nicola Sturgeon said she still hoped to build support for staying in the EU’s single market and customs union