Britain is worried the new law will drive its financial services elite out of London's
West End, home to eight out of ten European hedge funds, to cities like Geneva.
But it is isolated. Only the Czech Republic backed it in opposing the approval
of the new rules by the finance ministers, a weak alliance in the face of
heavyweights France and Germany, who pushed for rigid restrictions.
George Osborne, the 38-year-old British chancellor, blamed the country's
previous, Labour government for giving the new government a "hospital pass" --
a sporting term for a dangerous pass that the receiver cannot take without being
"I came here given a challenging position bequeathed to me by the previous
government," Osborne told reporters after being outvoted at the first meeting with
his peers. Officials said he did not speak during the deliberations on the issue.
Osborne now hopes to win a last-minute concession in negotiations with
parliament. Late on Monday, its economic affairs committee approved its version
of the draft law, backing the idea of a passport or EU licence for foreign funds.
Hedge funds have been accused of exacerbating Greece's borrowing difficulties
by betting against its debt, although there are few trading records to prove that
how much such betting took place.
The planned legislation would change that, proponents say, making it easier
for supervisors to see what is happening as well as intervene by curbing short-
selling, for example.
The hedge fund clampdown is part of a broader revamp of financial services in
Europe, spanning curbs on banker pay to demanding lenders put aside more for
On Tuesday, Germany's Schaueble also flagged a possible financial transaction
"Agreement on a European initiative would come at the earliest if there were
to be no such agreement at the G20," he said, referring to the meeting of
developing and industrialised nations in Toronto in June.
(Reporting by John O'Donnell, Huw Jones, Gavin Jones, Sumeet Desai and
Brian Rohan; editing by Stephen Nisbet, Ron Askew)
Posted by Attac Jersey - at 4:58 PM 0 comments
Links to this post