LONDON (MNI) – The UK Treasury will confirm Thursday that it is
taking legal action against the European Central Bank over its recently
published ‘location policy’ which aims to restrict clearing of
euro-denominated products by certain central counterparties to the euro
zone.
A Treasury spokesperson said: “This decision contravenes European
law and fundamental single market principles by preventing the clearing
of some financial products outside the Euro area. That is why we have
begun proceedings against the European Central Bank through the European
Court of Justice.
The location policy was published by the ECB on July 5 and is
contained on page 10 of the document which is available on the ECB
website.
The government believes that the ECB move goes against
the fundamental concept of the EU single market.
THe spokesperson continued:
“The Government believes this contravenes the fundamental
principles of the single market and European law, including the freedom
of establishment and the free movement of services and capital. It also
believes restricting the clearing of Euro-denominated products to only
firms based in Euro-zone countries would also undermine the Euro’s
standing as a truly global currency”.
“The Government wants to see this resolved swiftly and without
involving the courts, but if necessary will not shy away from continuing
legal action to make sure there is a level playing field across the EU
for British businesses.”
The UK is seeking to resolve the issue with the ECB in a swift,
simple and straightforward manner but is ready to, if necessary,
continue legal proceedings and challenge the policy through the European
Courts of Justice.
This will be the first time a Member State has taken legal
proceedings against the European Central Bank in this way.
London remains the world’s leading financial centre and is home
to 40% of global OTC derivative trading.
–London newsroom: 4420 7862 7492; email: ukeditorial@marketnews.com
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