Robert Ophèle, chairman of the Financial Markets Regulator (AMF), is demanding the restrictive EU rules change as they currently leave little room for national authorities to adapt to changing environments, such as Brexit. In EU law making, the rules for the single market are set out by politicians in “Level 1” and are made workable by officials but once they are in Level 1, they are inflexible. Mr Ophèle said: “As soon as you put something in Level 1, it’s very difficult to change anything, “Even without Brexit, we should have [more flexibility].
“But with Brexit, it’s obvious that we should.”
Andrew Bailey, the head of the UK’s Financial Conduct Authority, said Britain favoured regulation with fewer “detailed rules that can become set in stone” after Brexit.
Robert Ophèle used this point in his argument, telling the Financial Times: “To some extent it’s clear and they are right, that being so rule-based . . . is something which is detrimental to the efficiency, the agility, the capability of the European regulation to give the appropriate answer to any challenge.”
Referring to Britain’s strong financial position, Mr Ophèle said: “If the FCA was a leading force in the regulatory environment, it’s because London was connected with the real market, and listening to them and understanding how it works.”
In a bid for more flexibility, Mr Ophèle suggested European authorities should be allowed to issue “no action letters”.
These are widely used in the US to temporarily waive the application of rules in certain situations.
Mr Ophèle also said Brexit meant that it would be “essential to review existing third-country regimes”.
The UK will become a so-called third country after Brexit and will no longer be able to use the EU system of passports that allows UK managers to sell financial products and services across the whole of Europe.