In order to prevent London from falling further behind New York in the ranking list for the world’s financial services, Britain must make it simpler for employees who are stationed abroad to work remotely in London, according to a report released on Thursday by industry advocacy group TheCityUK.
Three continents are posing challenges to Britain’s dominant position in financial services investment as Singapore, France, and Germany quickly catch up.
The research, the most recent in a string of calls for Britain to do more to maintain its leadership in the sector, noted that the factors that drive investment are expanding beyond the cliché of “low tax, low regulation” to include open trade, closeness to tech providers, and high-quality infrastructure.
While the UK continues to be the top destination for foreign direct investment in the financial services sector in Europe, some UK businesses are opting to list abroad, with chip designer Arm’s recent New York flotation serving as an example. At the same time, European Union hubs like Amsterdam are forced to compete more fiercely with a post-Brexit Britain that is largely cut off from investors in the bloc.
“Britain attracted just three more financial services projects than France in 2021, 63 vs 60,” the report, compiled with law firm Freshfields Bruckhaus Deringer, said.
While several recommendations allude to already implemented changes, such as modifying insurance regulations to promote green investments, the report also calls for the facilitation of cross-border remote working.
The research recommended changing business visa regulations to permit employees who are based abroad to work remotely for British financial organizations and vice versa.
“Adopting an innovative cross-border remote working system would …also support manufacturing businesses across the UK,” the report said.
The need for local personnel in the new Brexit centers established by UK-based banks, insurers, and asset managers in the EU has been emphasized by EU authorities.
On Wednesday, City Minister Andrew Griffith stated that he was moving forward with the implementation of current changes and that many businesses were happy to be listed in Britain.
(Adapted from Reuters.com)