The Association for Financial Markets in Europe (AFME) has called on the Government to build on the UK-EU Financial Services memorandum of understanding.
In a paper outlining its vision for UK capital markets, the association addressed three focal points: overall principles for better financial regulation, the tackling of existing issues, and a revisitation of the relationship between the UK and the EU.
On this final principle, the association stated its desire to see both UK and EU markets develop in tandem and collaboratively address global issues.
As discussed in its recent statement, AFME supports the new UK Government’s commitment to UK capital markets and agrees that significant economic growth can only be achieved through well-functioning, deep and liquid capital markets. In this report, the association has shared principles that will help create markets that serve both company and investor needs and consider the impact of recent regulatory change.
The report also advises that the Government focus on encouraging long-term investments for the net-zero transition and consider removing the stamp duty reserve tax in order to promote capital market investment. It goes on to explain how a favourable and stable tax and investment environment in the UK could help the financial sector and the wider economy.
Adam Farkas, CEO of AFME, commented: “The Government should aim to ensure that the regulatory framework for financial services is clear, keeps business compliance costs proportionate, and ensures high standards across UK markets.
“AFME and its members would welcome, under the new Government, a clear focus on some of our main policy areas including, a rethink on the proposed FCA guide to enforcement, the recognition that the financial sector’s ability to support the transition will depend largely on whether the conditions are in place to enable the real economy to transition, a stable and favourable tax environment, a commitment to developing DLT based securities and a joined-up approach to accelerated settlement with the EU and Switzerland. We would also welcome a renewed conversation around securitisation to unlock lending to SMEs and to help finance the transition to net zero.”
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