LONDON — The European Commission is drawing up plans to effectively force firms with euro clearing activities in the UK to move them to the European Union or be subject to EU rules once Britain has left the bloc.
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REPORT: The European Commission is making plans that could threaten 83,000 jobs in the City of London
The European Commission is drawing up plans to effectively force firms with euro clearing activities in the UK to move them to the EU after Brexit.
A hangman's noose outside The Prospect of Whitby pub with Canary Wharf in the background.
The Financial Times reports that a draft policy communication from the Commission set to be released later this week will set out a series of measures that will seriously impinge on London's ability to act as a hub for the clearing of euro derivatives.
According to the report from the FT's Jim Brunsden and Alex Barker, the Commission's paper said that "specific arrangements based on objective criteria will be necessary to ensure that, where CCPs [central clearing counterparties] play a key systemic role for EU financial markets . . . they are subject to safeguards provided by the EU legal framework."
"This includes, where necessary, direct supervision at EU level [and/or] location requirements."
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last summer pressure from political leaders has intensified with regard to shifting clearing out of London, with officials from across the bloc frequently making clear they believe that it must shift to an EU hub like Frankfurt or Paris.
Last week, one of the key figures in clearing in the City of London, Michael Spencer — CEO of NEX — warned that forcing clearing houses to move operations out of London
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