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Old 26.06.2019, 13:36
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London exchanges prepare to delist Swiss stocks in EU row

From yesterday's Financial Times:

London-based exchanges are preparing to delist Swiss stocks this week after financial markets became entangled in a deteriorating row between Switzerland and Brussels over their relationship.

CBOE Europe, the EU’s largest share trading venue, said late on Monday that it would stop offering trading in more than 230 Swiss companies including UBS and Novartis from July 1, unless one side conceded in a dispute over a new economic relationship covering everything from financial markets and jobs to the movement of people. Aquis Exchange, which handles about 5 per cent of trading in Swiss blue-chips, said it would make a similar move if notified by the Swiss government in coming days.

Share trading has become a flashpoint in a long process for the EU’s efforts to upgrade its messy relationship with non-member Switzerland, in which Brussels is seeking to switch about 120 bilateral treaties into an “institutional framework” that would require the Swiss to automatically to adopt some EU laws — a prospect Switzerland rejects.

With little progress in the talks, the EU is poised to let a temporary permit that allows Swiss shares to be easily traded in the bloc to expire on June 30. “Everyone has accepted it will happen,” said a diplomat from a major EU member state.

About 30 per cent of trading in Swiss blue-chips takes place in London.

The dispute stirs up complications for Swiss companies and could even damage the Alpine country’s economy, say analysts. It also offers an insight into the potential pitfalls ahead for the UK’s post-Brexit relationship with the EU in financial markets.

Drawing up a new framework for Swiss-EU relations has dragged on after the Swiss authorities launched a six-month “public consultation” on the treaty at the end of last year. The EU’s stance on Switzerland has hardened in the light of the Brexit negotiations. Officials are wary of setting a precedent, where Swiss foot-dragging over its EU framework is not punished with the loss of access for parts of its financial markets.

Johannes Hahn, EU commissioner for enlargement, has warned Swiss authorities that there will be no “watering down of internal market rules, especially in what is probably the decisive phase regarding Brexit”.

A diplomat said: “We’re not going to treat the Brits any worse than Switzerland.”

In a sign that Bern was prepared to dig in, the finance ministry said it would activate countermeasures that would ban Swiss shares from being traded in the EU, to protect its domestic financial market. SIX, owner of the Swiss exchange, told customers that so-called equivalent status, in which each side recognises each other’s standards, “will most probably” not be granted.

Losing equivalence would mean that EU investors would have to trade Swiss shares in Zurich, through local brokers. Switzerland’s retaliatory measures mean EU trading venues could not offer shares in the biggest Swiss companies.
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Old 26.06.2019, 14:09
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Re: London exchanges prepare to delist Swiss stocks in EU row

Funny that the EU is using the UK's financial clout to hammer Switzerland when soon it will be the UK on the receiving end.
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Old 26.06.2019, 14:31
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Re: London exchanges prepare to delist Swiss stocks in EU row

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Funny that the EU is using the UK's financial clout to hammer Switzerland when soon it will be the UK on the receiving end.
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A diplomat said: “We’re not going to treat the Brits any worse than Switzerland.”
Yeap, it's coming.
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Old 26.06.2019, 22:10
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Re: London exchanges prepare to delist Swiss stocks in EU row

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The dispute stirs up complications for Swiss companies and could even damage the Alpine country’s economy, say analysts.
as usual anonymous "analysts", I also heard analysts say it's only a technical issue which acquired a lot of political value and is blown out of proportion.
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Old 26.06.2019, 22:28
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Re: London exchanges prepare to delist Swiss stocks in EU row

London is the biggest market after New York, if you want liquidity you don't have much choice.
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Old 01.07.2019, 11:01
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Re: London exchanges prepare to delist Swiss stocks in EU row

From today's FT:

EU-based traders caught in Swiss ‘equivalence’ spat

Breakdown in talks leaves investors in cross-border limbo

EU-based banks and fund managers face the threat of imprisonment in Switzerland from Monday if they flout a ban on trading hundreds of Swiss stocks following the breakdown of talks between Brussels and Bern.

Swiss regulators have imposed a ban on trading Swiss equities on exchanges in the EU after the European Commission let the “equivalence” status granted to Switzerland and its stock exchange expire, amid failed negotiations over a trading agreement with the EU.

The equivalence permit lets Swiss and EU investors freely trade across each others’ borders. From Monday, Swiss shares can only be traded on the Zurich exchange, via a recognised broker.

European investors will face punishments ranging from financial penalties to imprisonment of up to three years if they trade stocks, such as consumer company Nestlé or pharmaceutical group Novartis, away from Switzerland’s exchange.

As a result of the impasse, Swiss traders will also lose their access to EU-based stock exchanges from Monday.

The regulatory moves mark a new low for EU-Swiss relations, which have been strained for months over talks to formalise more than 120 bilateral treaties into a single framework deal that would require Switzerland to adopt some EU laws automatically.
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Old 01.07.2019, 11:10
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Re: London exchanges prepare to delist Swiss stocks in EU row

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From today's FT:

EU-based traders caught in Swiss ‘equivalence’ spat

Breakdown in talks leaves investors in cross-border limbo

EU-based banks and fund managers face the threat of imprisonment in Switzerland from Monday if they flout a ban on trading hundreds of Swiss stocks following the breakdown of talks between Brussels and Bern.

Swiss regulators have imposed a ban on trading Swiss equities on exchanges in the EU after the European Commission let the “equivalence” status granted to Switzerland and its stock exchange expire, amid failed negotiations over a trading agreement with the EU.

The equivalence permit lets Swiss and EU investors freely trade across each others’ borders. From Monday, Swiss shares can only be traded on the Zurich exchange, via a recognised broker.

European investors will face punishments ranging from financial penalties to imprisonment of up to three years if they trade stocks, such as consumer company Nestlé or pharmaceutical group Novartis, away from Switzerland’s exchange.

As a result of the impasse, Swiss traders will also lose their access to EU-based stock exchanges from Monday.

The regulatory moves mark a new low for EU-Swiss relations, which have been strained for months over talks to formalise more than 120 bilateral treaties into a single framework deal that would require Switzerland to adopt some EU laws automatically.
Many Swiss stocks can be traded in New York as ARR's, no stamp duty so always my exchange of choice. Problem instantly solved with a hard BREXIT.
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Old 01.07.2019, 12:40
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Re: London exchanges prepare to delist Swiss stocks in EU row

It's another nail in the coffin for the EU as a reliable place for financial services. They don't have the same liquidity as London (something they have already acknowledged) or Switzerland. Further, there are plenty of other places to trade that do grant equivalence, the USA (as mentioned) and Asia.

Three of the largest companies by market cap. Nestle, Novartis and Roche (and three of the most traded stocks) , are all part of the Stoxx50 index, and must be held by fund managers in many funds, so all this business will now have to be traded through Switzerland. A big dent in income for their banks nd brokers and a big boost for Switzerland's.

The EU does not care what harm it does to its citizens, or their businesses, as long as they get their way and in order to force non-EU countries to comply. Wasn't it these sort of diktats that ended several empires? Russian, Roman to name two.

Interesting to note that the penalty for trading is more severe than that handed out to drug dealers and other miscreants!!
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Old 01.07.2019, 13:08
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Re: London exchanges prepare to delist Swiss stocks in EU row

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The regulatory moves mark a new low for EU-Swiss relations, which have been strained for months over talks to formalise more than 120 bilateral treaties into a single framework deal that would require Switzerland to adopt some EU laws automatically.


Tom
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Old 01.07.2019, 16:06
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Re: London exchanges prepare to delist Swiss stocks in EU row

The EU seem determined to shoot themselves in the foot. Such childish behaviour is not going to help their chances dealing with Bonkers Boris...
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Old 01.07.2019, 16:47
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Re: London exchanges prepare to delist Swiss stocks in EU row

I’m expecting this to be a storm in a teacup. The EU threatening the nuclear option to get some minor concessions. I expect it will be over pretty quickly, while only strengthening the perception that the EU is a bully.

But let’s wait and see.
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Old 01.07.2019, 16:55
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Re: London exchanges prepare to delist Swiss stocks in EU row

I hope it goes through. I want to see some investors to to prison!
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Old 01.07.2019, 22:10
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Re: London exchanges prepare to delist Swiss stocks in EU row

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I hope it goes through. I want to see some investors to to prison!
Are you lonely?
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Old 02.07.2019, 09:58
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Re: London exchanges prepare to delist Swiss stocks in EU row

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The EU seem determined to shoot themselves in the foot. Such childish behaviour is not going to help their chances dealing with Bonkers Boris...
That's what it looks like indeed. The only explanation that would make sense to me is an attempt to demonstrate what the new framework would bring, as it outlaws such retaliatory measures (at least in the areas it covers).
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Old 02.07.2019, 16:52
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Re: London exchanges prepare to delist Swiss stocks in EU row

Interesting to note trading volumes in Swiss stocks were above the normal averages, so no Armageddon as some thought.
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Old 02.07.2019, 20:03
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Re: London exchanges prepare to delist Swiss stocks in EU row

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Old 03.07.2019, 08:56
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Re: London exchanges prepare to delist Swiss stocks in EU row

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Interesting to note trading volumes in Swiss stocks were above the normal averages, so no Armageddon as some thought.
Volume worldwide or volume in Switzerland?
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Old 03.07.2019, 12:27
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Re: London exchanges prepare to delist Swiss stocks in EU row

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Interesting to note trading volumes in Swiss stocks were above the normal averages, so no Armageddon as some thought.
The stock exchange just is not that important to business anymore. Companies do not use it as a main source of funding and it matters little to every day operations. In fact if anything it might help to reduce the short term thinking that goes on.
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Old 03.07.2019, 17:11
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Re: London exchanges prepare to delist Swiss stocks in EU row

And for a commoner like me, will my shopping basket be any cheaper?
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