LONDON - The European Union is set to delay a decision on allowing clearing houses in London to continue clearing euro transactions for EU-based clients due to Britain’s plan to breach part of the Brexit divorce settlement, a derivatives industry source said.
The delay is one of the first warning shots from the EU as UK lawmakers vote later on Monday on a bill that would breach parts of Britain’s Withdrawal Agreement from the bloc. Britain left the EU in January and transition arrangements that still allow unfettered access to the bloc end on Dec. 31. Euro clearing has long been a battleground between Britain, to keen to preserve London’s clout as a global finance hub, and EU policymakers, who believe the bulk of activity should reside in the euro zone under the eye of the European Central Bank.
Surprise!!!!!
Brussels had said it would grant Britain 'time-limited' access to euro derivatives clearing from January to avoid huge disruption to markets as a unit of the London Stock Exchange (LSE) (LSE.L) clears over 90% euro-denominated swaps that are widely used by companies.
Second thoughts before pulling the trigger on the gun they are pointing at their own head.
Waan bogadinaynaa