21) Are there additional actions in the field of financial services regulation that could be taken ensure that the EU is internationally competitive and an attractive place in which to invest? It is essential that the EU attracts investment from outside its borders; implementing legislation that is not coherent with global standards can hamper investment into the EU. The EU should proactively seek out opportunities to reduce barriers to trade with third country financial services firms. This is crucial for meeting the CMU objective of attracting more inward investment into the EU. Financial services are increasingly global, in terms of both the framework for regulatory standards and the nature of markets. In addition, the sources of extra-EU investment are growing. According to HSBC’s research paper, “The World in 2050”, 17 of the top 30 economies in the world in 2050 could be emerging countries. Their growth will be driven by financial markets, and both equity and bond markets may be more important in meeting finance needs than banks. As income, savings, and financial markets in emerging markets develop, investors in these markets will also increasingly look beyond their national borders in order to diversify their investment portfolio. International bodies, such as the FSB, play an important role in setting the standards for global markets. The EU and Member States should continue to be an influential voice in international organisations, setting high standards on financial regulation and ensuring these standards are implemented consistently by working closely with governments and regulators from key established and emerging financial centres. Where appropriate, the EU institutions should also carefully scrutinise proposed EU legislation in light of international competitiveness and the need for better regulation. EU trade and investment negotiations should also be sufficiently ambitious in terms of financial services, including increased market access and improved regulatory cooperation, and take every opportunity to enable the cross border flow of capital. In particular, the UK supports opening markets for cross border asset management in future trade agreements. The UCITS brand is already recognised and respected globally as an international benchmark but more could be done to facilitate third country investment. The UK supports recent Commission efforts to attract third country domicile, for example, through publishing UCITS guidance in Mandarin. But more can be done to ensure EU funds legislation provides a suitable platform for international investment, for example, through proportionate, balanced and properly functioning third country regimes that avoid unnecessarily blocking market participants from EU markets. Extreme care must also be taken to avoid protectionist measures and limits on overseas investment in EU funds legislation. Finally, in order for the EU to be attractive to investors, it needs a regulatory framework that is predictable, robust, and proportionate. The EU will not be an attractive destination for international capital if it does not address financial stability risks, investor protection or market integrity or misconduct. The EU has made great strides since the financial crisis to enhance financial stability and improve the operation of financial markets. It is crucial that this legislation is now implemented effectively with breaches of EU obligations, such as late implementation, reviewed and addressed on a consistent basis across the EU. It is also essential that new legislation is drafted to meet objectives and not impose unnecessary obligations on business. The UK therefore warmly welcomes the focus of the European Commission on ‘Better Regulation’ including robust ex-ante and ex-post impact assessments.