Business leaders are preparing to send a delegation to Brussels with a proposal for a post-Brexit free trade deal for financial services, the Financial Times has reported.
The City of London group fears the fallout from Brexit negotiations if access to EU markets is curtailed.
According to the newspaper, the delegation, to be led by former City minister Mark Hoban, is independent of the Government, but has the unofficial support of some Whitehall figures.
A number of banks have set up contingency plans after Theresa May said that with Brexit the UK would leave the single market.
Some banks have announced plans to move staff, while others have stepped up operations at EU sites in cities including Frankfurt and Dublin.
Losing access to the single market would lead to City firms losing “passporting rights”, which provide wide-ranging EU access for UK-based financial services.
Last week, Brexit Secretary David Davis suggested the UK will be out of the customs union and single market after March 2019.
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Mr Davis is due to host a conference for business leaders at Chevening House in Kent on Friday as part of a Government drive to give them a bigger say in the Brexit process.
It comes as The Guardian newspaper reported that the mood at Mr Davis’ Department for Exiting the European Union (DExEU) has changed, with officials now accepting that a “trade-off ” will be necessary when Britain leaves the bloc.
According to the newspaper, officials are now presenting ministers with a choice of either a deal similar to the European Economic Area (EEA), which comes with political compromises, or a free trade similar to the EU-Canada deal, which is more limited.
In her Lancaster House speech in January, Mrs May said the country was to leave the single market and customs union to gain full control of immigration, but wanted to still strike a “comprehensive” free trade deal with cross-border commerce to be “as frictionless as possible”.
Foreign Minister Boris Johnson had said that Britain “can have its cake and eat it”.
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A spokesman for Mr Davis said there had been no change of mood since the election, and insisted the approach outlined in the Lancaster House speech remained the official strategy.
Asked to respond to reports of ministers now being forced to consider a trade-off, he said they “did not recognise the language”.