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Barnier dismisses London ‘attack’ claims

Friday 4 November 2011 – by Will Henley

The European Commission has dismissed suggestions that Brussels is trying to hurt the City of London with a flurry of new regulations, yet insisted that the financial sector must be “more ethical”.

A week after British Prime Minister David Cameron warned that the City was under “constant attack” from a tide of EU financial rules, internal market commissioner Michel Barnier said such claims are “nonsense”.

“I see the City of London as an asset to the European financial sector and to the EU economy in general. This is my conviction,” said Barnier speaking at Cumberland Lodge in the capital.

As the commission, France and Germany plan introducing an EU or eurozone financial transaction tax, as well as new bank capital and derivatives curbs, Barnier added it was right to put forward “efficient and intelligent regulation”.

“It is not a threat to London’s financial centre. And I have seen no evidence that our rules, which the UK government has always signed up to, undermine the City’s competitiveness,” he said.

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“On the contrary, the right regulation will be a significant asset for the competitiveness of the industry. And it will contribute to Europe’s attractiveness for investors.

“But there can be no return to business as usual in the financial sector. I continue to hope the financial sector will lead the way with a more ethical and responsible approach in the ways they operate.”

Last week, after meeting EU leaders to discuss the EU debt crisis, Cameron said Britain would fight any attempt by Brussels to diminish his country’s financial sector.

Responsibility for single market rulemaking should rest with the full 27 members of the EU, rather than the 17 members of the euro area, the Prime Minister insisted.

“London is the centre of financial services in Europe,” Cameron told journalists as he flew to Australia to take part in the biennial Commonwealth summit.

“[However] it’s under constant attack through Brussels directives. It’s an area of concern, it’s a key national interest that we need to defend.”

The comments followed a divisive vote in the British Parliament the previous Monday, in which more than 80 of Cameron’s own party voted against the government to demand a referendum on membership of the EU.

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