A new framework for financial services regulation has been created followingthe transfer of responsibility for large parts of financial services regulationfrom the European Union back to the UK, consequent on the UK’s departurefrom the EU.
Today, the House of Lords Liaison Committee has recommended to the House of Lords the creation of a Financial Services Regulation Committee.
The report will now go to the floor of the House for approval.
The Liaison Committee expects the new Committee to scrutinise financial services regulatory consultations, and financial services regulation generally.
The new Committee is expected to complement the work of existing Lords committees, and the House of Commons Treasury Sub-Committee on Financial Services Regulations.
Introduction
The Government and financial services regulators have begun
the process of making changes, including through the Financial Services
and Markets Act 2023, which repeals retained EU law for financial services.
These developments have underlined the importance of parliamentary
scrutiny of the regulation of financial services.
2. The Financial Services and Markets Act 2023 provides for select committees
in each House (or a joint committee) to scrutinise consultations issued by
regulators of financial services:
• the Financial Conduct Authority;1
• the Prudential Regulation Authority;2
• the Payment Systems Regulator;3
• the Bank of England (in respect of rules relating to central counterparties
and central securities depositories).4
3. The Act’s provisions for select committee scrutiny were amended and
enhanced through amendments moved by the Government at report stage in
the House of Lords5, following debate at Committee stage on amendments
moved by Lord Forsyth of Drumlean (former Chair of the Economic Affairs
Committee) and others, with support being expressed by a range of Members
from across the House.6
4. Given the importance of financial services for the operation of the UK
economy, there is a pressing need for enhanced scrutiny not only of
individual consultations, but also of financial services regulation generally.
It is particularly important to take account of the evolution of the regulatory
framework following UK withdrawal from the EU. Consequentially, this
report recommends the appointment of a new committee on financial
services regulation...
more at House of Lords
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