Update: Davis Promises City Brexit Travel Exception

Davis said London would continue to thrive post-Brexit as the EU also has an interest in continued access to the City's expertise and capital markets, and because the UK would continue to pursue a similar regulatory regime.

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Speaking at the UBS European Conference to around 700 investors, financiers and regulators on Tuesday, Davis said that details of future co-operation would be agreed in exit talks.

However, according to the FT, Davis added: "None of this should be particularly controversial when we actually get down to it."

Davis' comments come amid continued fears of a flight from the City, as international banks and other financial firms prepare to move more staff to other EU capitals.

Aiming to ease fears, Davis offered a special travel regime that would particularly benefit the City.

"We want to ensure that our new partnership with the EU protects the mobility of workers and professionals across the continent," he said.

"Whether this means a bank temporarily moving a worker to an office in Germany or a lawyer visiting a client in Paris, we believe it is in the interests of both sides to see this continue."

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Under Davis' plans, inter-company transfers between offices would be treated differently to other forms of immigration, which would fall under a new British work permit system.

Though yet to be agreed, the scheme might allow workers posted abroad for under three months to come and go freely.

Transition deal

Davis also said that the UK would seek to reach an agreement in principle by January 2018 for a transition with the EU, which would last "around two years" after March 2019.

"Boards have to meet their fiduciary duties and investors need to make decisions critical to the future of their companies," he said.

"Without such an implementation period, some of these decisions would need to be taken in January 2018."

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The comments follow those made by Davis on Monday, in which he told European Business leaders there is a "50/50 chance" that a breakthrough on Brexit negotiations will be made by December.

Head of the BusinessEurope lobby group Emma Marcegaglia told Bloomberg in an interview that Davis had made the claims at the EU December summit on Monday.

Another European business leader who attended the summit also said Davis had estimated the chances of a deal at 50%.

However, a government spokesperson denied the claims, calling them "categorically untrue".

"David Davis did not say this," they said.

Meanwhile, sterling tumbled as much as 1% on Monday, following reports in The Sunday Times that claimed 40 MPs were ready to call for a vote of no confidence in Prime Minister Theresa May. The figure is eight MPs short of what is required to trigger a vote.

The EU withdrawal bill returns to parliament on Tuesday after Davis made concessions to concerns raised to MPs across the house, promising a vote on the final Brexit deal.

However, there are doubts the concession will be enough to secure victory for the government, with near 160 amendments currently tabled for the bill.

EU leaders will meet on 14 December to decide whether enough progress has been made on Brexit negotiations to move talks along. If they are unable to do so, EU officials have suggested that March 2018 could be the next opportunity for a breakthrough.