16 February 2021

FN: Politicians and ex-trading bosses launch new City lobby group to tackle Brexit

Initiative aims to promote ‘bold new initiatives to exploit the UK’s expertise in financial services’. A new lobby group has been formed to tackle Brexit on the back of complaints from the Prime Ministers office about the EUs unwillingness so far to grant the UK equivalence

Former trading chiefs and Eurosceptic British politicians have formed a new City-focused lobby group to “combat and negate the EU’s actions” by  “promoting bold new initiatives to exploit the UK’s expertise in financial services”.

The initiative, dubbed the CityUnited project and launched on 14 February, follows news of a pronounced shift in equity trading to venues in the EU, including those in Amsterdam, at the start of the year.

It also follows complaints from the Prime Minister’s office about the bloc’s unwillingness so far to grant the UK “equivalence” – the EU regulators’ process for granting market access to UK firms if the country’s financial rules are deemed similar to its own. Earlier this month, the Bank of England governor Andrew Bailey also called on the EU to rethink its approach to determining the UK’s post-Brexit access to the trading bloc.

Acting as chair of The CityUnited Project is Professor Daniel Hodson, former chief executive of the London International Financial Futures and Options Exchange, now part of the Intercontinental Exchange. The new group’s vice chair is Danny Corrigan, the former chief of the Chicago Mercantile Exchange’s European Trade Repository and former managing director at broker ICAP, now TP Icap, according to a statement from the group.

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The former chancellor of the exchequer Lord Norman Lamont, and Lord Daniel Hannan, the former founder of the Vote Leave organisation sit on its political advisory board, the statement said.

Hodson said that the new group’s “vision is a global City and UK financial services industry, serving the world and supported by a fair and competitive regulatory and taxation framework and the highest skills possible”.

“New opportunities are opening up to secure the City’s global leadership in regulation and product development,” he said. “We see a massive chance to strengthen and enhance the UK’s existing position in global regulatory leadership, working in partnership with other major financial centres across the world, in contrast to the increasingly protectionist financial markets of the EU.”

Corrigan said: “Daily we read negative stories about our markets and their future. We hear of equity trading moving to the EU, the euro rates derivative business – invented here – being arm-twisted out of London by the EU as it encircles trading, sales, clearing, settlement and payments exclusively on the continent. And yet we hear nothing from the City authorities, no rebuttal, no defence.”

“Well, that changes now with the City United Project,” he added.

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The government committed to securing a Brexit for UK finance that hinges on equivalence  following the announcement of the UK-EU trade deal, secured just days before the formal transition into Brexit on 31 December. The deal was notably lacking in provisions for financial services.

Teams from the UK’s Treasury and the European Commission are currently locked in discussions about the future of financial services following the end of the transition period, in a bid to sign a Memorandum of Understanding outlining a framework on the matter by March

FN

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