Britain could be more ‘blasé’ about EU finance laws

Tim May attacked the “massive overhit” of European regulation, such as MiFID II, which could harm outcomes for clients.

He argued that the full effects of all 43 pieces of legislation will not be felt for many years to come.

Mr May suggested the British culture of “following rules to the letter” meant the UK financial industry could be hamstrung by damaging legislation that was not being strictly observed by its European neighbours.

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He added: “Other countries are much more blasé about implementing this legislation, even though they strongly argued for their creation, and we might have to adapt to that environment, because it is madness to impose this on the UK, given the relative importance of this industry to our economy.”

Guy Rainbird, public affairs director at the Association of Investment Companies, said the UK government had to reconcile itself with the fact that it cannot unilaterally remove regulation.

He added: “The Coalition Government has committed to deregulation, but that will probably not extend to the financial sector. It has mainly been seen in safety and environmental legislation thus far.”

Mr Rainbird also predicted that the FCA would extend its marketing ban on unregulated collective investment schemes to encompass more products, adding that the regulator had “failed to see the error of its ways” on the matter.

Adviser’s view

Justin King, chartered financial planner at Dorset-based MFP Wealth Management, said: “Companies all over the world want to be listed in the UK precisely because of our reputation for honest and fair dealing, though we must punish those who tainted that through the London Interbank Offered Rate scandal. We’re in danger of entering Enid Blyton’s fabled land of the scallywags, where everyone misbehaves, if we simply copy other countries and flout the rules.”