Financial services sector 'under threat' from EU Directive

London's financial services expertise is under threat from plans to regulate the sector, according to the Mayor of London Boris Johnson.

The mayor will outline his concerns about a proposed EU Directive to regulate the alternative investment market, including hedge funds, in a meeting with EU commissioners in Brussels today.

Mr Johnson is concerned that further regulation could see funds desert the capital in favour of more attractive bases in New York, Singapore, Hong Kong and Geneva.

Ahead of the meeting, the mayor said: 'I'm in favour of proportionate regulation, where necessary, and that this industry must learn from the mistakes of the past.

'However, I strongly feel that this draft directive should be amended to ensure that we do not cut off a vital supply of investment funding at a time when the economy needs it most.'

Mr Johnson's plea will come a week after chairman of the Financial Services Authority Lord Adair Turner called for special taxes to curb the profits of large banking institutions operating in the UK.