The creation of new pan-European regulatory agencies to keep watch over the financial services industry has won the approval of the European Parliament. The EU national governments approved the legislation earlier this month.
The agencies will supervise banks, insurance companies, securities firms and markets. A new European Systemic Risk Board will look out for threats to the region’s economy.
The EU’s top Internal Market official, French Commissioner Michel Barnier, said: “Crises have to be prevented, we have to try to anticipate them. I think that prevention costs less than reparation, and that banks should have to pay for the banks, and today we’re creating the supervision framework.”
With parliament’s approval, the new surveillance agencies are supposed to be active by January. But, after a year and a half of negotiating the agreement, and a large majority voting in favour of it, debate in the assembly included voices keen to preserve competitiveness.
Godfrey Bloom, an MEP in the Europe of Freedom and Democracy group, told Michel Barnier: “I expressed grave concern that the regulation of the City of London was going to move to Brussels. You seem surprised I was so concerned, but you might, since you’ve taken office, understand that a significant portion of the UK GDP actually comes from our financial services. It’s very important to the UK.”
The European Banking Authority watchdog will be based in London. Britain has insisted that decisions of the pan-European agencies should never interfere with a state’s fiscal sovereignty.