By Huw Jones

LONDON (Reuters) – Top banks and asset managers have thrown their weight behind proposals in Britain to scrap curbs on share trading after billions of euros in daily stock dealings left London for Amsterdam due to Brexit.

After being cut off from Europe since December, the finance ministry suggested the revisions to wholesale capital markets in order to maintain London’s global competitiveness.

Britain’s share trading obligation is a law that requires market participants to use stock exchanges as a venue for trading. This rule was inherited by the bloc.

UK Finance, which is the representative of British banks, and the Association for Financial Markets in Europe, who are made up large asset managers and international banks, supported the removal of the STO in their response to the ministry’s open consultation.

AFME stated that they agreed with UK authorities about the need to remove the STO to allow UK-based companies to trade on venues that will provide the best results for clients.

UK Finance said that they agreed with the removal of this obligation as it simply placed unnecessary costs on liquidity providers, trading venues and has not provided any benefit. It also stated that any adverse consequences would not be caused by its elimination.

However, there are concerns about the possibility of a return to an efficient free-for all in share trading.

Michael Horan (director, EMEA trading at BNY Mellon’s Pershing), said last month to Reuters that the scrapping of the STO might cause an “explosion in other trading venues.”

It could prove to be too drastic and too quick in terms of making any changes. Horan stated that we don’t want to see liquidity go back to before, which was more fragmented and thus harder to police.

The finance ministry will publish its final plans to reform the wholesale market within the next few weeks after receiving responses to the public consultation.