Britain plans law to safeguard City of London's global standing

London

BRITAIN plans to buttress the City of London's global competitiveness and openness once it moves outside the European Union (EU) with new financial services sector legislation.

Although Britain left the EU in January, its unfettered access to the bloc for banks and other financial firms does not end until December this year, when the transition arrangements expire.

John Glen, Britain's financial services minister, said on Monday that the new Financial Services Bill would create a modern, flexible and robust system of financial regulation.

"(It) will underpin the continued global competitiveness of the UK financial services sector by enhancing its world leading prudential standards, promoting openness to international markets and maintaining the effectiveness of financial services regulatory framework and sound capital markets," he said.

The reference to world-leading prudential standards will reassure regulators in the UK who have cautioned about being given a formal remit to maintain the competitiveness of London as a global financial centre when writing new rules, fearing it would weaken standards.

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The EU, the City of London's biggest customer, has said it will give UK clearing houses temporary access but will not allow banks in London to offer services directly to customers in the bloc, forcing them to shift activities to new EU hubs.

Mr Glen, speaking at a City Week online event, declined to elaborate on Britain's negotiations with the EU on financial market access, but noted that a sector that pays £75 billion (S$132 billion) in tax each year was at the centre of the government's efforts to secure trade deals with countries across the world.

Britain is currently reviewing how it sets financial rules, that for decades were written in Brussels, in order to make the most of leaving the EU, Mr Glen said. REUTERS