The Institute of Directors has hailed a judgement from EU General Court which has backed Britain on the regulation of clearing houses as an important sign of the UK’s influence on European financial services policy.
Allie Renison, the IoD’s Head of Europe and Trade Policy said:
“We welcome the Court’s decision which recognises the importance of Britain’s role in Europe’s financial services industry. The precedent this sets in limiting the remit of an institution whose role is growing in importance for both the Eurozone and non-Eurozone countries is significant.
“Put simply, the European Central Bank was over-extending in trying to create a new regulatory role for itself. Had the Court backed the ECB in this decision, it would have left many London-based clearing houses feeling they had no choice but to leave the UK and move to the Eurozone. Thankfully, that will not be necessary and the UK’s leadership in financial services has been protected.
“By rejecting the ECB’s interpretation, the Court has also laid down an important marker for countries who want to see the ECB’s independence and separation from EU economic policy maintained. The decision to uphold the UK’s right to bring legal action should also be seen as an important safeguard for Britain, and other non-Euro countries, who want to influence policy, while remaining outside of the single currency.
“However, it is important to note that the judgment did not rule on the UK’s argument about the integrity of the Single Market and the principle of non-discrimination. It remains for EU legislators to decide if they wish to extend the ECB’s powers to include full regulation of clearing houses. In order to protect non-Euro members, Brussels must resist further attempts to regulate clearing houses. Otherwise they risk discriminating against Britain, and will face a backlash from national parliaments who may feel they are being pushed into choosing between joining the Euro, or leaving the EU.”