Government Delays Deal on EU Watchdog
A European Union plan to set up watchdogs for banks and to spot threats to the economy suffered a delay on Tuesday when Britain blocked an agreement, fearing the new bodies could bully London into spending. Sweden, which holds the EU presidency until the end of the year, tried at a meeting of the 27-country bloc's finance ministers in Luxembourg to secure agreement to set up the new super-watchdogs as soon as next year.
The executive European Commission unveiled its blueprint last month for an overhaul of the way banks and financial markets are policed. The plan is a central pillar for new rules designed to prevent a repeat of the economic crisis.
There is widespread scepticism in London about the new financial rules, which some British critics see as a Franco-German attempt to undermine Europe's financial capital. The new laws will give more say to European institutions. A risk board, for example, which would be staffed by the European Central Bank and based in Frankfurt, is likely to have wide-ranging powers.
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