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The Council of Finance Minsters meets tomorrow to vote on the text that was accepted by 25 of the 27 EU Member States on May 2nd. After the 16 hours on 2nd May, no further discussion on that text is planned - just a simple vote. The risk is that the UK may be outvoted 26-1 – though perhaps Bulgaria will continue to support the UK.
Chancellor George Osborne refused to sign the existing text at the last meeting – saying on television that he would look like an idiot if he did. He now has two choices – be “magnificently” outvoted, and then be cheered by euroscpetic Tory MPs when he reports to the House of Commons, OR accept this text and be shouted down as an “idiot”. But the game is a little longer, as the text then goes to the European Parliament as co-legislator and it might give Osborne what he wants in its text. But finally that must be agreed comma by comma with the Council. The Danish Presidency still hopes to get CRD IV/CRR through before the end of its Presidency next month. If not, an extremely technical dossier will pass to the Cypriot Presidency – at a time when tiny Cyprus is engulfed by the fallout from the Greek crisis.
The political sub-text is that Prime Minster Cameron demanded a British right of veto over financial matters in the Single Market at the celebrated December 9th Summit. The others refused that dramatically. They are equally determined that Britain will not acquire such a veto through the back-door by filibustering, especially when so many other issues demand attention. CRD is just one of a number of contentious financial regulatory issues that must be decided in the next year or so. The outcome will determine whether the euro area becomes a close-knit “banking union” in which Britain will find it ever harder to remain a member.
More detailed analysis of the regulatory issues is available to GrahamBishop.com members.