10 June 2020

FT: UK delays pledge to follow EU green finance rules post-Brexit

Treasury letter raises prospect of split on sustainable finance between London and Brussels.The UK has held off on fully committing to the EU’s landmark sustainable finance rules after Brexit, raising the prospect of a regulatory clash.

City minster John Glen told a House of Commons committee last week that the Treasury would reserve judgment on whether to implement forthcoming European rules aimed at preventing fund managers from falsely marketing their products as sustainable.

Brussels’ flagship green investment classification system is due to become EU law in the next few months, meaning it will apply to the UK, as the country is still in the Brexit transition period. However, the technical standards that make the regime operational are still unpublished and will not be finalised until after the transition period ends.

In a letter to the House of Commons’ EU scrutiny committee, seen by FTfm, Mr Glen said that the UK shared the EU’s aim of “promoting globally consistent standards” and preventing greenwashing. “These commitments form a key part of our strategy to strengthen the UK’s status as a global hub for sustainable finance,” he said.

However, he indicated that given the lack of technical details in the EU legislation, the Treasury did not want to be bound to the regime in full. “[As we] do not have clarity on the final outcome of the file, we cannot comment at this stage on the extent to which we will align with the EU after the implementation period.”

more at FT £

© FT plc