| LONDON, April 23
LONDON, April 23 Top exchange officials opposed
to a European financial transactions tax intensified their
lobbying on Tuesday, warning it would push trading to other
parts of the world and make it harder for companies to raise
Eleven countries from the European Union are examining a
plan to tax their stock, bond and derivatives trades from
January 2014, no matter where they happen in the world.
The aim is to raise up to 35 billion euros a year to make
banks pay for the help received in the financial crisis.
The United States opposes the levy, fearing New York will be
hit, while Britain, worried about its impact on London, the EU's
biggest trading centre, has challenged the plan at the European
Court of Justice.
Another EU member, Luxembourg, wants the tax reined back.
Mark Hemsley, chief executive of London-based BATS Chi-X
Europe, one of the region's pan-European stock exchanges, said
much financial regulation was politicised.
"The number one example of that is the financial transaction
tax which in the end will be extremely harmful for Europe,
especially if it stretches into extra-territoriality and becomes
the next trade war, as it were," Hemsley told a CityWeek
conference on Tuesday.
"The extra-territorial ramifications are absolutely
alarming," added Janet Ecker, president of the Toronto Financial
Services Alliance, which promotes the Canadian city as a
Brazil's bad experience with transaction taxes should be
noted, said Eduardo Refinetti Guardia, chief financial officer
of the Brazilian BM&F Bovespa exchange.
"The impact on the capital markets was very negative. We
started to see companies listing in the U.S. At the end of the
day what really happens is that you export your markets,"
Tomoyoshi Uranishi, a senior executive at the Tokyo Stock
Exchange, said the tax would be very dangerous for Europe's
market and "a very bad influence over the world economy".
"If the FTT is introduced extensively, I think most of the
trading weight will shift from Europe to Asia and America,"
Hemsley said the tax was being rushed without working out
how it will operate or be collected, with the cost ultimately
passed on to retail investors and pension funds.
A tax on trading in Italy and France has dented volumes and
this would be replicated across the 11 countries, said Finbarr
Hutcheson, chief executive, commercial and business development
at NYSE Liffe, one of Europe's top exchanges.
"We are a long way from the final proposal. This tax will be
implemented but it will be changed considerably from the first
draft," Hutcheson said.
"My mother in law thinks it's a great idea. I can see a
strong body of opinion outside this industry that wants some
sort of tax."