EU finance ministers have agreed to introduce tough new laws for the trillion-dollar hedge fund industry.
Hedge funds have been blamed for exacerbating the effects of volatile markets during recent crises.
The rules are only in draft form, but they propose to crack down on borrowing and executive pay, as well as putting the activities of hedge funds under greater scrutiny.
Objections by the new British government and the City of London were overruled.
As a result, the BBC reports London's financial district, where 80% of Europe's hedge funds are based, will be the hardest hit.