Gibraltar Financial Sector Expats Fear Spanish Veto On EU Agreement

Brexit is already hitting Gibraltar’s finance sector, with expat professionals warning about more disruption.

The continuing sovereignty dispute between the UK and Spain about the ownership of the Rock isn’t about to disappear once Brexit is finalised at the end of this year, with negative effects already hitting on the financial sector. A major cause for concern is the possibility of a Spanish veto on any future agreement made between the EU and the UK. Almost 100 per cent of the Rock’s residents voted against the UK’s leaving the EU, and the result of the 2016 referendum emboldened Spain’s claim to sovereignty over the peninsula, traditionally a British Overseas Territory. To date the Brexit effect has been confined to asset management companies who’ve either restructured or left, leaving the sector to look for new opportunities.

Chair of the Gibraltar Funds and Investment Association James Lasry fears a Spanish veto would put even more pressure on a financial sector now working to stabilise the industry. The financier still can’t believe how the ‘leave’ vote carried all after emerging, especially as he points out some 2.3 million who voted to leave have now died and been replaced by almost three million young voters inclined towards the UK’s remaining in the EU. He's crediting the Gibraltar government for its positive reaction to the referendum result, calling its response an ‘extraordinary job in a difficult situation’.

Keeping the right of passporting to the UK, with the Rock one of only two jurisdictions allowed the privilege, is a very useful development, with Lasry now calling on service providers to actively find opportunities to use the right. Even so, in spite of his overall positivity, Lasry’s major concern is the threat of a Spanish veto on any EU/UK agreement. He’s well prepared to counter Spanish efforts, especially as the ongoing situation also includes the rights to work for some 15000 Spaniards who cross the border daily to their jobs on the Rock. Plans to open Gibraltar to new markets including the USA could also be at risk should Spain get its way, and expats who’ve worked and lived in Gibraltar for some years are still fearing for their chosen lifestyles.