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FCA: Brexit not opportunity to join regulatory race to the bottom

The UK will need to “redouble” its engagement with European regulatory and policymakers following Brexit, recently appointed FCA chair Charles Randall says.

In a speech today in London, Randall acknowledges the impending withdrawal date reiterating that a Brexit agreement will have important implications for how the FCA works in the future.

Randall says: “The FCA does not see the UK’s withdrawal from the European Union as an opportunity to join a race to the bottom in regulatory standards – quite the contrary.”

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He adds: “We will need to redouble our engagement with our policymaking and regulatory colleagues in Europe and across the world, to continue to influence global standards of financial regulation.”

Randall cited a recent report which he says emphasises that strong global markets dampen the cycle of deregulation, crisis and regulation because they limit the opportunity for individual jurisdictions to race to the bottom.

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He says: “This is most definitely not a zero-sum game. Open and consistently regulated financial markets bring benefits to consumers and businesses in all jurisdictions.”

Randall adds: “That’s why I believe that consumers and businesses across Europe will expect to have continued access to the best financial services that are available in their time zone, maximising their own welfare and the potential of their nations’ economies.”

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Comments

There are 16 comments at the moment, we would love to hear your opinion too.

  1. Nicholas Pleasure 2nd October 2018 at 11:27 am

    Getting rid of most of MiFID II would be a good idea though.

  2. And my guess is that the same principles will also apply across the board. Agriculture and manufacturing will also have to adhere to EU and international standards and rules if we are going to continue to trade.

    Even our laws and legal practices will still be aligned. So all this talk of sovereignty is (as with all else Brexit) a chimera

    • That’s right, if we want to do business with them then we’ll need to adhere to those standards.

      Their economy will be over ten times the size of the UK and that puts them firmly in the driving position.

      Imagine leaving the worlds largest free trade zone only to start paying to trade with them, to follow the same rules as before and pay a huge bill for the pleasure of doing so.

      Its utter madness.

    • I disagree Harry, that’s like saying all financial advisers should be part of a network !

      I am not saying initially it wont be a struggle and there is a risk ….

      Give me sovereignty any day of the week

      You know as much as anyone the benefits of taking control and doing things for yourself, yes the EU, like a network has its place but that is a choice we should be calling the shots, not the other way around, I am not sure about you but I am fed up with the tail wagging the dog !

      As for Matts “largest free trade zone” that’s rubbish the world will be our “free trade zone” not some expensive jumped bureaucratic non entity who couldn’t agree on the colour of ~~~~ if its life depended on it !

      Remember the saying ” if you always do what you have always done you will only get what you always got”

  3. Is anyone asking for regulatory standards to be lowered? I think not. Rather, what we’d all like to see ~ in fact, what is desperately needed ~ is regulation that is proportionate and appropriately targeted, in line with the Statutory Code of Practice For Regulators.

    By all means borrow selectively the best elements of EU regulatory practice, but I don’t see why our involvement should extend beyond that.

    Surely, the FCA’s priority should be to get its own house into better order.

  4. This is the first I have heard of the FCA having a regulatory remit that includes – at our expense of course – the requirement to “continue to influence global standards of financial regulation”

    No doubt this will involve all manner of junkets across the Channel at 5 star hotels, lavish meals and ample leisure time.

    Nothing much has changed from the old FSA days, it seems.

  5. Harry, are you seriously that naïve to believe that the vote in June 2016 was between leave and the status quo bearing in mind how our relationship with the EU has changed since the first referendum in 1975? Have you not listened to Brussels’ (and some leaders eg Macron) regarding further integration or’harmonisation’ as they like to call it because that is certainly on the cards? The Common Market was a great idea (and still is) but when the mission crept into becoming a political project ordinary people right across Europe have finally become vocal, although some of their actions are reprehensible. The problem is that the EU mandarins, having been the carrot of immense power without any accountability, want to crush dissent and indeed grab more powers, I understand this quite natural human condition – don’t agree with it mind!

    If you were a totally new country, looking at the EU right now, would you want to join and that would include accepting the euro as your currency?

    Have you considered that the FCA by saying they need to ‘redouble’ efforts they are making a play for more staff/power etc themselves?

    • Hallelujah! The first person (whose posts I’ve noted) to ask the key question ~ would the populace of any independently successful independent nation looking at the EU from the outside really think to itself Hey, this looks great, we’re really missing out by not being part of it? The hell they would.

    • “If you were a totally new country, looking at the EU right now, would you want to join and that would include accepting the euro as your currency?”

      I don’t know what you mean by a totally new country (they will be a bit hard to come by) but there are several “established” countries that are lining up to join the EU, as you would know if you actually did some research.

      It’s not Harry Katz, et al that are being naive. You have, in your post, admitted that the EU has changed over the years. Like most people, with no vision of the future, having said what you did it staill doesn’t occur to to you that it will continue to change. We just won’t be playing the part we should in bringing about the changes.

      I wonder if some people just like division wherever they can make it happen, whether it makes the world a more dangerous place or not. Even if we do leave the EU we will go back in, in the future. It is the way forward. Younger people will demand it and it is inevitable. The shame is that there will be much damage done to the UK (which has already become an international laughing stock) and a lot of hand wringing, in the meantime.

  6. Alright Patrick thanking for noting my lack of precision, by new, I mean not already in the EU. Please tell me which countries wish to join the EU and euro and crucially what they bring to the party – will they be a net contributor to the EU purse or not for example? As for the influence we might bring/might have brought to bear under the current system- Germany accounts for about 30% of the Eurozone GDP so whose interests are paramount (and understandably so I have to say)? And, as for Brussels – do you really think they will relinquish any of their powers or agree to becoming more accountable? If you are so keen on research, look up the Treaty of Rome and associated reading to see how its very laudable aims were compromised by not having an accountable bureaucracy. I do not object to change but without true accountability or an acknowledgement they might get it wrong, the current Brussels bureaucracy is taking Europe down a pat fraught with pitfalls.

    • Pretty much what I thought ~ why are all these countries knocking on the door to get into the EU? Not because they see it as a jolly good club to which they should altruistically contribute a slice of their hearty GDP. They want to join so they can get their hands on a slice of the pies of the small number of other countries already in who are doing well.

      And why did countries like Greece join?

  7. … and Patrick I have noticed that I have missed out the ‘you’ at the start and an’h’ off path! 🙂 And to both you and Harry, the debate should be about striking the right balance between the needs of businesses large and small and those of the communities in which they operate – currently it seems to be more about who insists they have the moral high ground but it is really vested interests looking after themselves – certainly if the behaviour of our political and big business classes is anything to by. You will note I have not been personally impolite in either post nor have I ‘spun’ any comments made as it does make one’s point any more valid.

  8. Philip Holbrook 2nd October 2018 at 6:14 pm

    Spot on Julian Stevens and Chris De Luca, my thoughts exactly.

    Let us not forget that, as well as being Net Contributors, we buy more from the EU than we sell, so we are Net Customers. Tesco are much larger and more powerful than me, but if they put the price of their milk up, I’ll shop elsewhere. Ok, it’ll be a pain for a while, but life goes on and once the logistical wheels have been oiled and well tested, the overall cost of the said price of milk will come down as I work out a more efficient way of buying it.
    Imagine paying for your Clubcard membership, only being able to shop via Tesco and allowing their board to have the final say in your house rules, would you pay for membership or tell them to get stuffed and look elsewhere???

    • I heard on the radio the other evening that just one of the controls that the EU wants to retain over us is the power to dictate the terms of any trade deals we may wish to make with non-EU countries. That surely smacks of protectionism.

  9. As ever I know I’m wasting my time by responding. Of course Matt Amber is right.

    DH I would have joined a network if it meant that it would be harder to trade without one and that I would be poorer as a result. Your analogy is flawed.

    Chris de Luca. In my personal view the EU has changed for the better. When you compare our pathetic politicians to Macron, I can only hope we get someone of his caliber. A real breath of spring. Personally I see closer political union as a ‘good thing’. Who want’s to be subordinate to the US, China or Russia? We need the collective muscle. Alone we are just an insignificant speck.

    Patrick Schan. Precisely! Well put.

    • Harry
      Every network I know, would have you believe, it would it would be harder to trade, and you would be poorer by not joining …

      Flawed analogy…. I think it is spot on

      If the EU make it harder and more expensive to trade (in fact cut their nose off to spit their face) we go elsewhere.. Free Trade in its purest form

      The EU and it bureaucrats is the rubber dolly (that always makes me giggle) you often refer to, not ideal and hardly satisfactory.

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