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EU Assembly Backs High-Frequency Curbs Against U.K. Panel Advice

Oct. 26 (Bloomberg) -- European Union lawmakers renewed calls for tougher curbs on high-frequency trading and limits on commodity speculation as part of a push to toughen the 27-nation bloc’s financial-market rulebook.

European Parliament legislators, voting in Strasbourg today, defined the assembly’s stance before talks on the proposals begin with national governments. They also agreed to largely scrap proposals to boost competition between clearinghouses, saying the measures may harm financial stability.

Michel Barnier, the EU’s financial services chief, proposed the measures last year. The parliament and EU member states must hammer out an agreement before the steps take effect.

The U.K. government’s lead scientific adviser, John Beddington, this week warned against implementing some of the curbs on high-frequency trading, saying they may choke off benefits to the economy and hamper the functioning of markets.

Rules backed by the assembly include a requirement for traders to hold orders in the market for at least half a second and punitive fees for excessive numbers of canceled orders.

Markus Ferber, the German lawmaker steering the bill through the EU parliament, has said the curbs are needed to ensure that high-frequency trading brings genuine benefits to markets and doesn’t cause instability.

Today’s vote echoes positions approved last month by the assembly’s Economic and Monetary Affairs Committee.

To contact the reporter on this story: Jim Brunsden in Brussels at jbrunsden@bloomberg.net

To contact the editor responsible for this story: Anthony Aarons at aaarons@bloomberg.net

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