These crazy proposals are, however, subject to Qualified Majority
Voting and - according to FT Deutschland - with Germany's support
having been secured, there is now a qualified majority in the
Council, as the reforms are opposed only by the UK, Slovakia and
Slovenia.
This is called "French plot against London" and with the snub by
Sarkozy to The Queen over D-Day (noted for the majority of those
landing then being British and no involvement by the French) we seem
to be on the way to a resumption of the Napoleonic Wars.
But this is deeply serious.
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FINANCIAL TIMES 3.6.09
Hedge funds may quit UK over draft EU laws
By James Mackintosh and George Parker in London and Nikki Tait in
Brussels
Some of Britain's biggest hedge funds have warned the UK Treasury
they will be forced to leave the country unless a draft European
directive is radically changed.
Some have already begun back-up preparations to move to Switzerland
in case the rules - described by one manager as a "French plot
against London" - are not rewritten. New York is also a possible
destination, according to another.
The warnings come as hedge funds step up their campaign against the
draft directive on alternative investment fund managers, which was
modified at the last minute to require the European Commission to set
a limit on borrowing. Private equity firms are also fighting the rules.
Ian Wace, co-founder of hedge fund manager Marshall Wace, told the
Treasury this week it should modify tax rules to allow the thousands
of Cayman Islands-based funds to move to be fully regulated in
London, rather than have much of the industry abandon Europe.
"If this directive goes through as drafted, large chunks of the
industry will be leaving Europe, whereas we have the opportunity
today to have large chunks of this industry coming to Europe," he said.
At a meeting organised by Dan Waters and Henry Knapman of the
Financial Services Authority and Tom Springbett, a Treasury
representative, officials reassured almost a dozen of London's top
managers they would fight for changes.
Managers present included Mr Wace, Jon Aisbitt, chairman of Man
Group, Hugh Sloane, co-founder of Sloane Robinson, David Stewart,
chief executive of Odey Asset Management, and executives from the
London arms of America's Tudor Investment Corp, Citadel and Och-Ziff.
People present said the FSA officials accepted that the "killer"
rules limiting borrowing - and defined to include the implicit
borrowing built in to derivatives - would make popular strategies
such as 'global macro', made famous by George Soros, impossible. But
the FSA and Treasury argued the definition of borrowing was so
"obviously ridiculous" it was bound to be rewritten, one official said.
Lord Myners, City minister, accused the European Commission of
producing "naive" proposals.
Speaking to MPs, he said the draft directive "did not conform with
the best practice of consultation" and he was confident it could be
improved.
===============================
TELEGRAPH 4.6.09
Myners attacks EU's bank regulation proposals
City minister Lord Myners has warned that European proposals on
banking regulation could hand greater political control of Britain's
vital financial services industry to the EU if left unchecked.
By Philip Aldrick
today's European elections, he rejected several central reforms
advocated by former Bank of France governor Jacques de Larosiere.
Reflecting bankers' fears that the proposals could signal the start
of EU encroachment on UK policy, he said: "We oppose a European
single supervisor, because national governments are the only bodies
capable of providing any fiscal support to firms.
"It would not be appropriate to transfer such powers to the EU while
leaving national governments accountable."
His comments echo those of Bank of England governor Mervyn King, who
has said banking supervision must remain national because financial
institutions are "global in life, but national in death", as national
taxpayers have to pick up the bill for a bail-out.
"We do not support new powers for EU authorities to change national
supervisory decisions. It could undermine crisis management and
fiscal accountability," Lord Myners added. He also objected to Mr de
Larosiere's proposal that the chairman of the European Central Bank
be permanent chairman of the "macro-prudential" regulator that takes
an overview of global financial stability and to whom national
regulators will be accountable.
"We believe the macro-prudential body should be sufficiently
independent of the ECB so that it represents the whole of the EU and
not just the eurozone," he said.
Echoing Mr King and Lord Turner, chairman of the Financial Services
Authority, Lord Myners backed the principle of co-ordination between
European regulators. However, investment bankers are concerned that
greater co-ordination could force banks to hold more capital and make
them less profitable.
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