Could your bonus be vetoed ?
Bonus-cap exemptions championed by the European Union’s banking regulator may be vetoed by EU lawmakers who said they’ll fight a weakening of curbs on excessive payouts.
Bloomberg reports that members of the European Parliament said they’ll be on the hunt for loopholes when they examine draft European Commission measures to implement a law to cap bankers’ bonuses at twice their salary. The European Banking Authority last month advised the commission to allow waivers to some staff earning more than $1.4m a year.
'Parliament has been serious about capping the bonuses,' Othmar Karas, vice president of the EU assembly, said in an e-mailed statement. 'If the draft on the technical details proposed by EBA leaves loopholes open, parliament is going to make use of its right to object'.
The EU assembly scored a political victory last year when it clinched a deal with governments on rules curtailing the bonus culture that lawmakers blamed for fuelling the 2008 financial crisis. The U.K. government challenged the caps at the EU’s highest court in September, saying the measures were flawed.
'The draft rules have been highly contentious and a number of banks have looked at ways of avoiding the cap, exactly what the European Parliament wants to clamp down on', Stefan Martin, a partner at Mayer Brown LLP, said in an e-mailed statement. 'But there are no clever ways around the cap'.
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