BRUSSELS: European Union regulators walked back a policy that would have blocked some equity trading on London exchanges after Brexit, following criticism from money managers and officials in the UK.

EU investors will be able to trade all UK stocks on London venues even if the country leaves the bloc without a withdrawal agreement, the European Securities and Markets Authority said Wednesday, reversing guidance issued in March.

The new approach is more likely to minimise the risk of disruption, the regulator said.

Under the initial plan, EU investment firms would have had to trade certain shares within the bloc, even if a stock’s main listing is in London, potentially affecting stocks like AstraZeneca Plc, Rio Tinto Plc and Vodafone Group Plc.

Money managers have said the policy would keep them from trading efficiently and expose them to overlapping rules for UK and EU stocks.

The UK’s Financial Conduct Authority said it’s “encouraged that ESMA has taken steps to reduce the disruption.” But not all of its concerns have been addressed, it said, citing the example of EU stocks that are mainly traded in the UK.

“Some shares have their main or only centre of market liquidity outside the country in which the issuer is incorporated,” the FCA said in a statement. “This approach would place restrictions on a company’s access to investors and freedom to choose where they seek a listing on a public stock market.”

ESMA said the revision followed discussions with the FCA and a consideration of the feedback received since March.

EU investors would still be barred from trading some 6,200 European stocks in the UK in a no-deal Brexit.

Today’s announcement “is a great success for the industry and for investors,” the German Investment Funds Association BVI said in an email. It also urged a solution for Irish shares that are primarily traded in London.AFP