The Paris-based European Securities and Markets Authority (ESMA) is seeking to tighten up its financial equivalence, the regulatory framework that allows firms from outside the EU to gain access to the European financial service market.

With a view towards a post-Brexit reality, ESMA’s chair Steven Maijoor expressed concerns about the potential for the exploitation of loopholes between UK and EU financial regulations, which would pose a systemic threat to the Single Market, the Financial Times report.

During a press conference in London, Maijoor made clear he is seeking additional powers to prevent regulatory competition that is based on arbitrary outcomes and ensure alignment.

The UK’s Financial Conduct Authority has sought to appease ESMA by fending off fears that there would be a regulatory race to the bottom. During the same press conference, the FCA’s director, Chris Woolard, said that the current regulations would remain in place after Brexit.