Barnier and von der Leyen urged to punish UK unless EU rules followed 'Use the ...

MEPs are pushing for an EU crackdown on the City of London firms unless the Government agrees to toughen up its stance against money laundering and tax avoidance.

PUBLISHED: 11:42, Wed, Jan 6, 2021 | UPDATED: 12:14, Wed, Jan 6, 2021

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Brexit deal can be ended in 'so many ways' says EU law expert

They are calling for Brussels to withhold legal permits allowing UK bankers and fund managers easy access to the single market until the changes are made. Senior members of the European Parliament’s green group have claimed the new UK-EU trade and security deal doesn’t contain stringent enough measures on financial transparency and corporate taxation. In a letter to Brussels boss Ursula von der Leyen and Brexit chief Michel Barnier, the MEPs insist the bloc should be doing more to prevent the UK from undercutting the EU.


Co-chair Philippe Lamberts and economic policy spokesman Sven Giegold said the post-Brexit future relationship pact still allows Britain to embrace a “Singapore on Thames” model.

They wrote: “We strongly recommend that the leverage we still hold over the United Kingdom in granting access to the single market for financial services or not should be used to the maximum extent in order to gain robust commitments against tax dumping and in favour of financial transparency.”

Mr Barnier attempted to prevent the UK from gaining a competitive advantage over EU firms by slashing regulation through the so-called “level-playing field” in areas such as environmental standards, workers’ rights and state aid.

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But the MEPs say the provision does not go far enough in the areas of tax and transparency.

Michel Barnier and Ursula von der LeyenMichel Barnier and Ursula von der Leyen urged to crack down on City of London rules (Image: GETTY)

Ursula von der LeyenCommission President Ursula von der Leyen signing the Brexit deal (Image: GETTY)

They argue the tax avoidance measures are limited to global rules and do not cover the EU’s tax haven list and code of conduct for business taxation.

The MEPs want Brussels to use powers to control UK banks, brokers and exchanges’ easy access to the single market.

They propose using the leverage of equivalence decisions, which are based on the EU accepting Britain’s

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