The Financial Services Bill outlines how the UK will regulate the sector outside of the EU and will secure the UK as a global hub for the finance industry. The legislation, which has just received royal assent, amends existing laws in 17 areas, including banking rules and benchmarks.
The laws include changes to help people struggling with problem debt and an extension of the maximum criminal sentence for market abuse from seven years’ imprisonment to 10.
Alongside this, the landmark law will also make it easier for the police to freeze and confiscate the bank accounts of criminals and terrorists.
The laws also include a ministerial commitment to provide long-term access between the UK and finance haven Gibraltar for firms.
Ministers say the legislation is an “important first step in taking back control” of financial services regulation and will ensure the UK remains a “world-class” financial centre post-Brexit.
John Glen MP, Economic Secretary to the Treasury, added: “For the first time in decades, the UK has full control of its own financial services regulation.
“This Act will protect people who rely on financial services day-to-day and boost the competitiveness of our dynamic global financial centre.
“It marks a major milestone in our plans to develop a regulatory regime that works for the UK and helps us seize new opportunities in the global economy.”
The passing of the legislation marks a pivotal moment in seizing back control from Brussels as a deal on access to EU markets for London financiers remains stalled.
EU and Treasury officials agreed to a memorandum of understanding last month, which said there would be a regular dialogue between regulators in a bid to allay the bloc’s concerns.
However, the end goal would see the EU grant market access to British firms, known as equivalence in a post-Brexit financial services deal.
Financial services are responsible for almost seven percent of the UK’s GDP and adds £130billion to Britain’s economy each year.
The new laws will also benefit consumers as they will be able to get a cashback in a shop without them buying anything.
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Under previous EU rules prior to Brexit, meant businesses were not allowed to offer cash back without a purchase unless registered to do so with the Financial Conduct Authority (FCA).
The Access For Cash review led by chair of Innovate Finance Natalie Ceeney CBE says eight million people still rely on cash – around 17 percent of the UK population.
Lord Holmes, who tabled an amendment to get the law added, said: “Cash can seem somewhat old fashioned and is certainly no longer king but it still matters materially to people up and down the country.”