LONDON (Reuters)—Britain said on Wednesday [June 25] it would push the European Union to improve the way it sets financial rules, promising to protect London's role as a global financial sector and demanding better assessments of the impact of new regulations.
Nicky Morgan, newly-appointed minister in charge of financial services, said she would lead a major drive to improve the EU's legislative process and pledged to keep on challenging rules that Britain disagreed with.
With Britain facing defeat later this week in its battle to stop Jean-Claude Juncker become the next president of the European Commission, Morgan struck a combative tone in her first major speech to London's financial community.
"I will be very prepared, when called upon to fight your corner," she said. "Where that involves, how shall I put this, a reasoned argument with our European counterparts I'm prepared to have it."
Britain, which is seeking to protect London's role as a financial centre and stop the EU centralizing financial services, has lodged a string of challenges with the European Court of Justice over EU regulations.
The country has a fraught relationship with the EU under Prime Minister David Cameron, typified by his opposition to Juncker, who is perceived to want a more united Europe.
Morgan signaled that Britain would not hesitate to challenge EU rules in the European Court of Justice in future.
"Where we think that EU legislation is at odds with the treaties, we have challenged it in the courts," Morgan said.
Britain, whose financial services sector generates 8 percent of all its economic output, has suffered high-profile defeats in the top EU court on regulatory issues such as a financial transactions tax and a law banning short-selling trades.
Two other challenges, to rules on bonuses and against a European Central Bank demand that specific financial services must be located inside the euro zone, are ongoing.
But on Wednesday Morgan pledged that Britain would keep asking "awkward questions" and said that she would be pushing the EU to improve its lawmaking process, reflecting concerns expressed by London's banking industry.
"If we want a more effective EU we have to lead a major drive to improve the process of legislation," Morgan told senior bankers at the event run by financial industry group TheCityUK.
"You have made very clear how important this is to you, so I will be very loud in pushing for that to happen."
By William James and Huw Jones