The Case Against the Case Against the Cap While it applies across Europe, the rule has been particularly controversial in the UK, both because of the concentration of financial institutions in the City of London, and because of the somewhat disproportionate impact of the rule, UK pay structure having historically been weighted more towards performance-based variable pay and less towards fixed entitlements, as compared to European peers. Since January 2014, EU banks have been required under the Capital Rights Directive IV to limit variable pay to a maximum of 1x fixed pay, or 2x fixed pay with shareholder approval. Osborne has stated that he is “not going to spend taxpayers’ money on a legal challenge that is unlikely to succeed.” However, the decision should not be seen as a resolution instead, it serves to highlight the distinct approaches taken by the UK and EU on the structure and regulation of bankers’ pay. While the AG’s opinion is not binding on the CJEU, in the majority of cases the Court will follow the opinion, and Mr. The move came after an advocate general (“AG”) for the Court of Justice of the European Union’s (“CJEU”) stated that the restrictions on bonuses as a ratio of fixed pay were legally sound, and suggested that the UK’s pleas should be rejected and the CJEU dismiss the action. The UK Treasury has dropped its lawsuit against the EU’s strict banker bonus rules. Glass Lewis Feedback and Complaints Center.Best Practice Principles & Stewardship Codes.