Professor Philip Lane:

I will not talk about specifics. On a firm making a decision about where to go, apart from the regulatory issue, there is a whole pile of other factors, such as location and proximity to London, which will enter that decision. I must emphasise again the scope for regulatory arbitrage is not zero but is limited. By and large, all EU countries operate under the same framework.

There are European supervisory authorities, for example, with insurance. The European Insurance and Occupational Pensions Authority, EIOPA, means all insurance regulators get together frequently. There are plenty of discussions about what we want to ask of a firm moving from London and exchanges about coming up with a common framework. It will not be conclusive in the sense that there is still room for risk assessment. There will be differences in variation in what exactly is the risk posed to the host country by a given corporate structure. There may well be legitimate differences of opinion across a system. The Senator gave two examples. Let us see as time moves about the balance on when there is a wider set of examples.