EU referendum: Prime Minister David Cameron comes up against opposition from finance ministers on "single rule-book for the financial sector"

James Nickerson
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Sapin said the foundations of the single market had to be protected (Source: Getty)

David Cameron's draft EU deal has come under pressure from the French and Dutch finance ministers over legal protection for the City of London, as Europe prepares for the EU summit next week in Brussels.

French finance minister Michel Sapin has warned that nothing in the deal can be allowed to stand in the way of further Eurozone integration, or confer special status to any particular industry, including financial services.

The comments put Cameron in a difficult position as the UK seeks legal protection for the City from new regulations that would apply across the whole of the EU, including countries outside the monetary union.

Read more: Brexit's hidden risks for the City

While there will be a "dialogue" over the UK's desired changes in this area, fundamental principles can not be sacrificed, Sapin said.

"Economic and monetary union is going to get deeper - must get deeper. There can't be a veto, no mechanism that will slow down this deepening of the economic and monetary union," he said. "It's the same everywhere - across the whole territory of 28 [members states] - whatever the product, but particularly when it comes to financial products."

"We don't want any clashes, nothing to jeopardise this single financial market. The legislation may be different, but the effect must be the same across the whole European territory." he added.

Read more: Who would want to lead the Leave campaign now?

The French finance minister was joined by his Dutch counterpart, Jeroen Dijsselbloem - who is also Eurogroup president. “There are some concerns about the single rule-book for the financial sector” Dijsselbloem said.

Any deal needs to respect the principle of "strong, common" rules for financial services, which “is a very strong element of our joint internal market, and we must make sure that we don’t lose that", he added.

Chancellor George Osborne wants assurance that the UK, and other non-euro nations, will not suffer discriminatory EU rules dictated by a majority consisting of Eurozone nations acting out of self-interest.

Finance ministers would be discussing “the right relationship between countries in the Eurozone and those outside the Eurozone, like the UK, in a way that makes sure we have the best arrangements for financial stability”, Osborne said ahead of today's meeting of EU ministers.

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