EU adviser blocks UK bankers’ bonus appeal

Britain’s relations with the EU took another knock yesterday when its legal challenge to a limit on bankers’ bonuses was rejected by an adviser to the bloc’s top court.

The EU law aims to curb the kind of risk-taking that led to the 2007-2009 financial crisis by limiting bonuses awarded from next year to a sum no more than a banker’s fixed pay, or twice that level with shareholder approval. Britain, home to the City of London where most of the bankers hit by the cap are based, said the law would push up fixed pay and goes beyond the EU’s powers, a sensitive subject at a time of rising British anti-EU sentiment.

The adviser, whose opinions are non-binding but are generally followed at least in part by the Luxembourg-based European Court of Justice, supported the limit on banker bonuses and said it did not restrict the total amount of pay.