FRANCE is plotting a huge post-Brexit power grab for UK clearing houses in a shameless attempt to keep the EU meddling in Britain post-Brexit.
K clearing houses, which handle more than £650 billion per day and provide huge tax revenues, are subject to a raging debate between divided European Union states.
In the latest battle of Brexit, Paris is demanding the EU is given a tota veto over how Britain supervises UK-based clearing houses of euro denominated transactions after Brexit, EU sources said.
EU sources say France is determined to move the lucrative euro clearing process from London to the EU after Brexit – with Paris one of the cities set to benefit from such a move.
Euro clearing has become a battleground issue between London and Brussels during Brexit talks with both sides fighting for the tax revenues and hundreds of thousands of jobs which come with the process.
And EU policymakers say they should have a say over such “third country” activity in order to ensure euro zone financial stability in times of crisis.
The EU has proposed a draft law which proposes joint supervision of clearing houses outside the EU – but France wants even tougher measures that could take clearing houses outside of Britain.
Euro clearing would have to move from London to the EU if joint supervision was deemed insufficient by Brussels.
EU policymakers say they should have a say over such “third country” activity in order to ensure euro zone financial stability in times of crisis.
Germany says in its submission the EU proposals don’t go far enough in giving the European Central Bank (ECB) powers to change clearing house rules and act quickly in a crisis, the source said.
The proposed law will be discussed by EU states in the next few weeks, with a divide already emerging between different leaders.
France is attempting to secure the UK’s clearing houses after Brexit
Germany and Austria are against handing more powers to Paris-based groups at the expense of national regulators and instead backs giving the European Central Bank powers to “make regulations to ensure efficient and sound clearing and payment systems” within the EU “and with other countries”.
Spain said it was unsure whether such “deep change” was actually needed for supervising clearing houses, a view backed by Sweden, a sign of how member states don’t want to see their national watchdogs lose more power to EU regulators.
Storm Surge Watches are now in effect for Anguilla, Montserrat, St Kitts, and Nevis, Saba and St Eustatius just hours after the islands were hit by Hurricane Irma.
LCH, a unit of the London Stock Exchange (LSE.L), currently dominates clearing of euro denominated derivatives.