The Financial Services Bill returns to the House of Lords tomorrow for its second reading and is set to cause more uproar.
The Bill paves the way for the abolition of the Financial Services Authority, which will be replaced by three new regulators – the Financial Policy Committee, in charge of system-wide financial stability; the Prudential Regulation Authority, tasked with micro-regulation of systemically vital firms such as banks; and the Financial Conduct Authority, which will oversee capital markets, conduct of business and consumer protection.
The London Stock Exchange, which will come under the latter regulator, is concerned that the plans for the FCA do not go far enough. It points out that while the FSA had a specific brief for "the international character of capital markets and the desirability of maintaining the competitive position of the UK", its successor will not inherit that requirement.
The Confederation of British Industry and the Association of British Insurers have expressed similar concerns particularly as a number of major corporates are once again looking at leaving the UK.
LSE chief executive Xavier Rolet said: "We need to ensure the Bill puts in place the right regulatory framework to make the UK markets fit for purpose and ensure their competitiveness for years to come."
The Bill is expected to become law in 2013.Reuse content