Tag: London

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Business

The UK’s new prime minister could possibly be about to shake up the Metropolis of London

Talks about deregulating Britain's financial sector are

People in the UK financial sector are wondering if the new PM will change the regulatory landscape.

Jeff J. Mitchell/Staff/Getty Images

As Liz Truss becomes Britain’s new prime minister on Tuesday, questions will be raised about her plans for Britain’s historic financial district – the City of London – as the country grapples with a deepening cost-of-living crisis and the ongoing conflict in Ukraine.

According to the Financial Times last month, the city’s regulators could be in for a big shake under Truss. It cited campaign insiders who said Truss will seek to review and possibly merge the three major London regulators – the Financial Conduct Authority (FCA), the Prudential Regulation Authority (PRA) and the Payment Services Regulator (PSR).

She has also suggested reviewing the Bank of England’s mandate during her time as Prime Minister.

“Change for Change’s Sake”

The FCA regulates 50,000 firms in the UK to “ensure our financial markets are honest, competitive and fair”, according to its website. The PRA, meanwhile, oversees the work of around 1,500 financial institutions to “ensure the financial services and products we all rely on can be delivered in a safe and sound manner.”

Their responsibilities sound similar, but the various organizations were formed when it was decided that the Financial Services Authority, which regulated the city between 2001 and 2013, had several functions that could be better served by separate organisations.

According to Matthew Nunan, a partner at law firm Gibson Dunn and a former department head at the FCA, the original agency’s main objectives were good governance and financial soundness across the sector. He said the split in two is seen as a way to give these goals equal priority.

“The simple question that needs to be answered now is: What would the reunification of the PRA and FCA do?” Nunan wrote in an email to CNBC.

“If the answer is to reform the old Financial Services Authority, what was the question? Or is it simply change for the sake of change?”

Governments should always “challenge the status quo,” Nunan said, but argued that it was a question of whether doing so would actually better serve the “changing needs of a nation.”

“The problem here is that instead of articulating a problem and seeking evidence, the statements made seem to be proposing answers to questions that no one is asking,” he said.

Nunan also highlighted the difference between regulators and politicians, saying regulators are “never allowed” to make proposals in the way Truss has done.

“Regulators are legally required to make evidence-based decisions about rule changes [and] require a cost-benefit analysis before they can be implemented… If that applies to regulators, why doesn’t it apply to politicians?” he asked.

“Light Touch Regulatory Regime”

The “fight” to deregulate the banking sector is like “turning back the clock to the pre-2008 global financial crash,” Fran Boait, director of campaign group Positive Money, told CNBC’s Squawk Box Europe last month.

Boait said there was a risk that the country would find itself in the same situation “or much worse”.

“Liz Truss’ proposal to merge the three key city watchdogs would risk restoring this light regulatory regime — the regime we had before the crash,” she said.

She also stressed that less than a decade has passed since the organizations were founded.

“It wasn’t long ago that we put in place a much larger regulatory regime because there was a consensus that the regime contained so many risks [that] Complexity in the financial sector needs to be properly regulated,” she said.

‘ambiguity’

Discussions of a review or merger of any of London’s regulators remain speculative as Truss has yet to issue any official statements on the matter.

This is leading to a “lack of clarity” about the future status of the three regulators, according to Hargreaves Lansdown analyst Susannah Streeter.

She said improving financial services for customers should be at the forefront of any regulatory discussion.

“Whether they stay as single entities or as a merged entity, it’s really important that the UK has dynamic regulators that make the most of the Brexit freedoms,” Streeter said in an email to CNBC.

Tackling fraud, creating more opportunities for investors to invest in IPOs and how information is shared with prospective investors should be on the agenda of any proposed changes to the current regulatory regime, she added.

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World News

10% London places of work susceptible to turning into out of date underneath new power guidelines

10% London offices at risk of becoming obsolete under new energy rules

A view of the City of London on a clear day.

Vuk Valcic | SOPA pictures | LightRocket via Getty Images

LONDON – According to an analysis by a leading real estate company, around 10% of London offices could soon become unusable if new energy efficiency rules are introduced.

Under the new standards, due to be introduced in 2023, buildings in England and Wales with an energy class lower than “E” cannot conclude new leases. The upcoming measures are part of a broader government effort to be carbon neutral. The lowest energy efficiency class is set from ‘G’, the least efficient, to ‘A’, the most efficient.

In that regard, an analysis published by Colliers last week showed that around 20 million square feet of London workspace, which is nearly 10% of the total stock, does not meet these rules.

This raises questions about the future of these office buildings, especially at a time when many workers are pushing to partially work from home amid the ongoing coronavirus pandemic.

“It’s like a double blow for these buildings,” Andrew Burrell, senior real estate economist at Capital Economics, told CNBC, referring to the upcoming environmental regulations and the impact of the Covid-19 crisis.

Offices that fail to comply with energy efficiency regulations are at risk of becoming “obsolete,” he added.

That comes faster than [landlords] expected.

Tom Wildash

Co-Head of West End Leasing at Colliers

In addition, the same study found that currently only about 20% of offices in central London have an energy rating of “A” and “B”, with about 57% of jobs in the UK capital falling into “D” and “G” categories ‘Categories.

Tom Wildash, co-head of West End Leasing at Colliers, told CNBC that landlords must decide whether to upgrade their buildings to an energy rating of “E” to meet the 2023 rules, or upgrade their energy rating directly to “B” renew. Meet laws by 2030. The UK government has reportedly been deliberating on legislation that could mean that only ‘A’ or ‘B’ ratings for non-residential buildings can be rented by 2030.

“That comes faster than [landlords] expected, “said Wildash, adding,” behind the scenes they will likely tell you it’s under control. “

Landsec and British Land, two leading office developers in London, have unveiled their own plans to become carbon neutral in the coming years. However, the new energy regulations will require renovations and thus additional costs in part of the existing building.

“Refurbishment is an important tool in the race for net zero real estate. With the preservation of structures, careful selection of new materials and modern construction techniques, the embodied carbon of a refurbishment project could mean a 50% saving compared to building a new one, “said James Pay, director of sustainability at Colliers, said in a statement.

Speaking to CNBC, Pay said residents are open to renovation options rather than high quality new build.

Sales areas

“Retail space faces similar problems,” said Nicholas Hyett, senior equity analyst at Hargreaves Lansdown, a private investment platform.

Retail is also going through massive changes, compounded by the coronavirus pandemic, as more and more people buy online.

Data released by the UK’s Office for National Statistics shows that while the share of online retail spending fell in June, it is still higher than pre-pandemic levels.

Colliers’ Wildash told CNBC that around 10% of London’s retail space can be expected to need updating too to become more energy efficient.

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Health

Medical hashish agency backed by Snoop Dogg begins buying and selling in London

Medical cannabis firm backed by Snoop Dogg begins trading in London

Recording artist Snoop Dogg speaks on stage on day one of TechCrunch Disrupt SF 2015 at Pier 70 on September 21, 2015 in San Francisco, California.

Getty Images

LONDON – Oxford Cannabinoid Technologies, happily endorsed by rapper Snoop Dogg and tobacco giant Imperial Brands, launched on the London Stock Exchange on Friday.

The British company, which specializes in developing pain relieving cannabinoid drugs, grossed £ 16.5 million ($ 23.4 million) in gross proceeds on its IPO with a starting market value of just over £ 48 million ($ 69 million) .1 million USD).

The share price hovered around 5p on Friday lunchtime after opening near 8p.

Snoop Dogg, whose real name is Calvin Broadus Jr., has invested in several cannabis startups, including OCT, through his venture capital firm Casa Verde. His firm has also supported plant-based food companies like Outstanding Foods and tech names like Klarna, Robinhood, and Reddit.

Cannabinoids are naturally occurring compound chemicals found in the cannabis sativa plant and are commonly used for medicinal purposes to treat symptoms such as chronic pain.

OCT’s strategy is to develop cannabinoid drugs for the non-addictive treatment of painful conditions. CEO John Lucas told CNBC on Friday the company plans to use the proceeds of its IPO to develop four new drugs.

“The key here is getting cannabinoids into the hands of patients and the way you do that happens through the drug development process,” Lucas told CNBC’s Squawk Box Europe.

“With medical cannabis, the problem is that doctors can’t prescribe it, so we want a drug that we can get into the hands of doctors, into the hands of patients.”

In its listing announcement, OCT said its “primary market focus is on the total addressable pain market, valued at at least £ 42.5 billion through the commercialization of the first drug manufactured by OCT, currently expected in 2027.”

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World News

DARK inventory skyrockets 43% in London debut

DARK stock skyrockets 43% in London debut

A demonstration of Darktrace cybersecurity software shows how a global problem can start with just one workstation for one employee.

Michael S. Williamson | The Washington Post | Getty Images

LONDON – British cybersecurity start-up Darktrace saw its shares surge up to 43% in its highly anticipated debut in London on Friday.

The company priced its shares at 250p on Friday morning. At that price, Darktrace was valued at £ 1.7 billion ($ 2.4 billion), the company said.

At around 8:15 a.m. London time, Darktrace shares soared over 358 pence, up 43%.

Darktrace said its offer would include approximately 66 million shares – or approximately 9.6% of Darktrace’s outstanding share capital – for a total of £ 165.1 million.

Of this, £ 143.4m will go to the company and £ 21.7m to existing shareholders. The company has announced that it will sell an additional 9.9 million shares if demand proves higher than expected.

Darktrace stock began trading conditional trades under the ticker “DARK” on Friday morning. Unconditional trading is expected to begin on May 6th.

It’s the second major test of London’s appetite for high-growth tech companies. Last month, Amazon-backed grocery shipping company Deliveroo flopped on its debut, tumbling as much as 30% on one of the worst London IPOs in history.

After Brexit, the UK is reforming its listing regime to attract companies like this. A government-commissioned review calls for a relaxation of the rules for two-class share structures and SPACs (Special Purpose Acquisition Companies).

London has had a busy year so far, with technical IPOs, with Deliveroo, Trustpilot and Moonpig going public. However, some investors fear that Deliveroo’s disappointing performance – over 32% below its IPO price – could deter other tech companies from listing in the city.

With a market cap of £ 1.7 billion, Darktrace was conservative on its IPO, compared to the valuation of up to $ 4 billion originally hoped for.

The company’s listing was followed by concerns about its close relationship with controversial UK tech entrepreneur Mike Lynch, who is fighting extradition to the US

Lynch is accused of fraudulently increasing the value of Autonomy, the software company he founded, on Hewlett Packard for nearly $ 11 billion in 2011. Lynch denies any wrongdoing.

Lynch’s Invoke Capital was an early investor in Darktrace. Poppy Gustafsson, CEO of Darktrace, and Nicole Eagan, Chief Strategy Officer, also worked at Autonomy. Darktrace says Lynch has no direct involvement in the day-to-day running of the company.

Founded in Cambridge in 2013 by a group of former intelligence experts and mathematicians, Darktrace uses artificial intelligence to detect and respond to cyber threats in a company’s IT systems. According to Crunchbase, a total of $ 230.5 million has been raised by investors to date.

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Business

How Can the Metropolis of London Survive Brexit?

How Can the City of London Survive Brexit?

LONDON – Following this year’s Brexit, the UK government needed a new blueprint for the future of the country’s financial services as cities like Amsterdam and Paris vied to become Europe’s next investment and banking capital.

For some, the answer was Deliveroo, a London-based food company with 100,000 riders on scooters and bicycles. Despite losing more than £ 226 million (nearly $ 310 million) in the past year, Deliveroo offered the raw promise of many fast-growing tech startups – and it became a symbol of Britain’s new ambitions by choosing to Go public and list your stocks not in New York, but on the London Stock Exchange.

Deliveroo is a “true UK tech success story,” said Rishi Sunak, the UK’s chief financial officer, last month.

It was a false start. Deliveroo has since been dubbed “the worst IPO in London history”. On the first day of trading, March 31, the shares fell 26 percent below the market price. (It’s gotten worse.)

The flop has damaged the image of the City of London – the geographic and metaphorical name for the UK’s financial center – as it attempts to recover from the country’s exit from the European Union. Some of the effects of Brexit were immediately felt: on the first working day of 2021, trading in European stocks shifted from the venues in London to the major cities of the bloc. Then London’s share of trading in euro-denominated derivatives fell sharply. There is fear about what might go next.

Financial services are an integral part of the UK economy, accounting for 7 percent of gross domestic product – £ 132 billion in 2019, or around $ 170 billion. Exporting financial services and other professional services is something that sets the UK apart. Membership of the European Union allowed London to serve as the financial base for the rest of the continent and the city’s business grew. Four tenths of exports of financial services go to the European Union.

The government has embarked on a series of reviews and consultations on a variety of subjects, including IPOs and trading regulations, to seek ideas to bolster London’s reputation as a global financial center.

For many, the changes cannot come soon enough.

“The UK is not going to sit still and watch its financial services move to other European cities,” said Alasdair Haynes, founder of Aquis, a London trading venue and stock exchange. This will be exciting for the next three or four years, he said.

However, this optimism is not universal. The prospects for a warm and close relationship between the UK and the European Union have deteriorated significantly. The two sides recently finalized negotiations on a Memorandum of Understanding to set up a forum to discuss financial regulation. However, the forum is voluntary and the document has yet to be signed.

The European Union has made no secret of its plans to build its own capital markets, which could flourish if London is denied access. The “mood music in the EU,” said Andrew Pilgrim, who heads the UK government and financial services team at EY, focuses on having autonomy over one’s own financial services rather than relying on the UK.

It is becoming increasingly attractive for Great Britain to write its own financial rules. The trick is to attract more business without lowering regulatory standards in London, which many consider a strong win. A recent Duff & Phelps survey of senior financial managers found that fewer see London as the world’s leading financial center, but that it tops the rankings for the regulatory environment.

Here are some of the plans.

“I want to make the UK the best place in the world for high-growth, innovative companies,” Sunak told Parliament on March 3rd. On the same day, a government-commissioned review recommended changes to encourage technology companies to go public in London. Common New York ideas were suggested that would allow the founders to maintain more control of their company after they began selling shares.

Example: Companies with two share classes and different voting rights (like Facebook) can be listed in the premium section of the London Stock Exchange, which could pave the way for inclusion in reference indices. Or: to allow a company to go public while selling a smaller proportion of its shares than the current rules require.

In business today

Updated

April 16, 2021, 10:48 p.m. ET

The timing of Deliveroo’s IPO was no coincidence. It was listed on double-class shares, which gave its co-founder William Shu more than half the voting rights for three years – a structure that should closely align with the review’s recommendations, the company said.

But the idea might be a no-starter among some institutional investors in London. Deliveroo flopped in part because they opposed the offer of shares with minimum voting rights.

Others, however, are enthusiastic about the ideas of the review carried out by Jonathan Hill, a former European Commissioner for Financial Services. Among them is Mr Haynes, whose company Aquis acquired a stock exchange last year to compete with the London Stock Exchange.

“I am very supportive of what Lord Hill did,” said Haynes, who wants his exchange to become “Europe’s Nasdaq” one day. It seeks to lure companies into some of the larger companies that get involved with perks such as a no-sell policy (a practice where investors bet against the price of a stock). The Nasdaq has a coveted reputation for listing technology giants like Microsoft, Apple, and Facebook.

London doesn’t have “that alternative for fast-growing companies,” said Haynes.

Mr. Hill’s report also urges London to become a more welcoming home for special-purpose acquisitions or blank check businesses, the recent craze in the financial markets that has caught on with investors and celebrities alike. SPACs are public shell companies that are listed on a stock exchange and then look for private companies to buy.

London was left in the SPAC passion. Last year, according to Dealogic, 248 SPACs were listed in New York and only four in London. In March, Cazoo, a British used car dealer, announced that it would go public through a SPAC in New York.

There are already signs that Amsterdam could take the lead in this booming business for Europe. This year there were two SPACs each in London and Amsterdam, but the value of the listings in Amsterdam is five times that of London.

The UK’s financial regulator announced that it would soon open consultations on SPACs and introduce new rules by the summer.

London already has a reputation for producing soaring financial technology companies like Revolut and Monzo, both of which expanded into the US, and Wise (formerly Transferwise), which was valued at $ 5 billion last year. All three are so-called challenger banks that offer financial services via apps without the need for stationary branches.

The government clearly wants to build on this dynamic. It released an independent review of the fintech industry in February and is already acting on some of its recommendations, including setting up an express visa procedure for people interested in coming to the UK to work for fintech companies. The review also recommended a program that will bring regulatory blessings to small businesses experimenting with new fintech offerings and services.

As the UK prepares to host the United Nations Climate Change Conference in November, the government aims to transform London into a global hub for investors looking to spend their money on green and sustainable initiatives.

Mr Sunak has previously said that the Treasury Department will require large corporations and financial firms to disclose all climate change risks to their businesses by 2025 and is working on a taxonomy to define what really counts as “green”. Next, millions of pounds will be invested in new research centers to provide climate and environmental data to financial companies.

The government is also seeking to reclaim the lost ground in Germany, France and other European countries by issuing green bonds to fund projects to combat climate change.

London’s financial industry is in no danger of collapsing, but with Brexit, one of the cornerstones of the UK economy is no longer looking as impressive as it used to be. And as London tries to keep up with New York, it looks over its shoulder at the financial technology coming out of Asia.

The government has continuously billed Brexit as an opportunity to do more business with countries outside the European Union. This will be vital when international companies wonder whether they want to set up their European business in London or elsewhere.

When it comes to the future of the UK, it is “almost a look back at the future of London as an international center as opposed to an international and European center,” said Miles Celic, the executive director of CityUK representing the industry. “It doubles on international business.”

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Entertainment

Regé-Jean Web page and Emily Brown Hug Earlier than London Flight

Regé-Jean Page and Emily Brown Hug Before London Flight

Dear reader, it seems Bridgerton Star Regé-Jean Page may have found Romance IRL. On February 9, before a flight to London, he was seen hugging writer and athlete Emily Brown. Phew, this smolder is hard to miss! The two were in a good mood as they hugged amid the snowflakes. Both wore long puffer coats and winter clothes.

Regé-Jean is particularly private about his relationship status. Of course, the audience tried to establish love relationships with him Bridgerton Costar Phoebe Dynevor, whom, like the Duke of Hastings, he skilfully bypassed on the dance floor. “I think all you need to know is in front of the camera. That’s why we presented it so nicely for you,” he joked during an interview with Access Hollywood. He added, “All the sparks that have flown from the beautiful scripts given to us, and so I think the sparkling script material is more than enough.”

The actor has yet to confirm or comment on his relationship with Emily, and she has remained similarly silent. Maybe it’s because Regé already has a lot on his plate – what about his Saturday night live Hosting gig is coming up. For the moment we let the following photos tell the story.

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Health

Trial in London utilizing tech to observe wellbeing of weak folks

Trial in London using tech to monitor wellbeing of vulnerable people

Half point | iStock | Getty Images

Two local authorities in London are said to control “in-home sensors” to monitor vulnerable residents who live in public apartments.

The idea is yet another example of how connected devices can play a role in feeding and supporting those who need them.

The Richmond and Sutton City Councils in the south of the UK capital are partnering with IoT Solutions Group, which provides IoT technology and solutions, to test 200 sensors on properties owned by the Richmond Housing Partnership and Sutton Housing Partnership.

The European Commission has described the Internet of Things as the merging of “physical and virtual worlds that create intelligent environments”. Think of devices that are connected to the Internet and can “talk” to each other.

In an announcement earlier this week, SHP said the technology provides “automated, real-time insights into how active a person is in their own home.”

The idea behind the technology is relatively simple. When the sensors detect a decrease in activity from your home, an automatic alarm is sent to caregivers or people known as Independent Living Officers. This enables them to make a proactive, urgent visit to the property rather than relying on a scheduled appointment or contacting residents.

Steve Tucker, executive director of the Sutton Housing Partnership, said in a statement released Monday that the pilot “would really improve the lives of the elderly residents in need.”

While the potential of sensors such as those used in Sutton and Richmond is interesting, some may be concerned about privacy issues for those using the service, especially when the technology is being installed in people’s homes.

To allay those fears, SHP said Monday that “no visual or audio recording” will take place and no personal information will be collected.

As technology has developed, the number of monitoring devices that can be installed in the homes of the elderly and vulnerable has increased.

The Carers UK charity lists several including: passive infrared detectors; Property output sensors; Panic buttons; GPS tracker; and sensors that send notifications to caregivers when someone has fallen.

A changing landscape

For many, digital technologies are playing an increasingly important role in their healthcare system.

Apps accessed on a mobile phone can now remind patients to take their medication, schedule appointments with their doctor, and access test results.

The adaptability of this type of technology was highlighted in 2020 when countries launched contact tracing apps to help fight the coronavirus pandemic and limit the spread of the virus.

Over the past year, the way patients interact with doctors has changed as health care providers and governments try to reduce their prevalence.

Many first personal appointments now take place online using video conferencing software that can be accessed via laptops, cell phones or tablets.

In the UK, the National Health Service states that after an online consultation, medical practices will contact their patients by email, phone or video call, or personal appointment.

There were more than 1 million users in a blog post by Susie Day, program director of the NHS app, last November. This is “more than twice as much” as at the beginning of March.

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Business

London mayor Sadiq Khan declares a significant incident within the metropolis

London mayor Sadiq Khan declares a major incident in the city

Patients arrive in ambulances at the Royal London Hospital in London on January 5, 2021. The British Prime Minister made a national televised address on Monday evening, announcing that England would take action against the Covid-19 pandemic for the third time. This week, the UK recorded more than 50,000 new confirmed Covid cases for the seventh straight day.

Dan Kitwood | Getty Images News | Getty Images

LONDON – London Mayor Sadiq Khan declared a serious incident on Friday over the rapid spread of the coronavirus in the British capital.

He had previously warned that the virus was “out of control” and that the National Health Service was “on the verge of being overwhelmed”.

“I reported a major event in London because the threat this virus poses to our city is in crisis,” Khan said on Twitter.

“One in 30 Londoners now has COVID-19. If we don’t take action now, our NHS could be overwhelmed and more people will die,” he added.

Serious incidents have already been reported following the fire in Grenfell Tower in June 2017 and the terrorist attacks on Westminster Bridge in March 2017 and London Bridge in November 2019.

The announcement comes shortly after weekly dates through January 2nd. London’s coronavirus infection rate had risen to 1,038 per 100,000 population. That number contrasts with a citywide infection rate of 818 per 100,000 in the previous week.

For comparison, the national infection rate was 612 per 100,000 in the week ending January 2.

Stressed health facilities

Increasing pressure on already strained city health facilities coincides with the resurgent spread of Covid-19 as the UK scrambles to contain a highly infectious variant of the virus.

On Wednesday, the Health Service Journal reported, citing a leaked briefing from NHS England to senior doctors in the capital, that London hospitals were well on their way to being overwhelmed by Covid within two weeks.

The report said the NHS England presentation predicted the capital’s health service would have close to 2,000 beds for general, acute and intensive care by Jan. 19, even if additional Covid patients grew at the slowest rate that is considered likely.

NHS England was not immediately available to comment on the report when CNBC contacted him on Friday.

A nurse is adjusting her PPE in the intensive care unit at St. George’s Hospital in Tooting, South West London, where the number of intensive care beds for the critically ill had to be increased from 60 to 120, the vast majority of them for coronavirus patients.

Victoria Jones – PA Pictures | PA Pictures | Getty Images

Daily death toll hits record

Prime Minister Boris Johnson announced the third national lockdown for England on Monday to contain the spread of the virus. He urged people to “stay home,” just like they did in March 2020 during the country’s first national lockdown. The measures came into law on Wednesday.

To date, the UK has registered 2.89 million cases of Covid-19 with 78,633 deaths, according to Johns Hopkins University. On Friday, the government reported that an additional 1,325 people had died within 28 days of a positive test, the highest daily death toll since the pandemic began.

In recent weeks, optimism about the mass rollout of Covid vaccines appears to have been tempered by the resurgent rate of spread of the virus.

The UK on Friday approved Moderna’s Covid vaccine for emergencies in the country. It is the third shot approved for use in the UK following previous vaccine approvals from Pfizer and BioNTech, as well as the University of Oxford and AstraZeneca.

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Health

London to maneuver into prime tier of restrictions

London to move into top tier of restrictions

Commuters walk the Thames Path with a view of Tower Bridge in London, UK on Monday 14 December 2020.

Hollie Adams | Bloomberg via Getty Images

LONDON – London is being placed in England’s toughest coronavirus restrictions on Wednesday morning from midnight after a rapid surge in Covid-19 infection rates.

Health Secretary Matt Hancock confirmed the move on Monday when addressing lawmakers in the House of Commons. He said UK authorities had identified a new variant of the virus that could be linked to the faster spread of cases in the south-east of England.

“Initial analyzes indicate that this variant is growing faster than the existing variants,” said Hancock, adding that 1,000 cases of the new variant have been identified in England so far.

“There is currently no evidence that this variant is more likely to cause serious illness and, based on the latest clinical recommendations, it is highly unlikely that this mutation will not respond to a vaccine.”

Hancock said similar variants of the coronavirus had been identified in other countries in the past few months and that UK health officials had notified the World Health Organization. Public health experts would continue to analyze the newly identified variant of the virus in the UK, Hancock said.

Earlier this month the government put in place a three tier system of public health measures across England to contain the spread of the outbreak after a month-long lockdown.

At the time, millions of people across the country were placed in “Tier 3” but the UK capital was placed in the second highest level of restrictions.

A nationwide review of the tiered system was originally scheduled for December 16.

In addition to London, parts of Essex and Hertfordshire will move into “Tier 3” from 00:01 London time on Wednesday.

Health Secretary Matt Hancock arrives at the BBC Broadcasting House in London to appear on the Andrew Marr Show.

Aaron Chown | PA Images via Getty Images

“I know this is difficult news and I know that it will disrupt plans and that it will be a severe blow to the companies affected,” said Hancock.

“But this measure is absolutely necessary, not only to keep people safe, but because we have seen that taking action early can help prevent more damaging and longer-lasting problems later,” he added.

What does tier 3 mean?

Under Tier 3 restrictions, people cannot mix indoors, in private gardens, or in most outdoor locations.

Shops, gyms, and personal care services such as hairdressers are allowed to stay open, but bars, pubs, and restaurants must be closed except for takeaway and delivery.

“I know these steps are difficult, but we mustn’t waver when we hit the final stretch. When we look back on this period of crisis we can all say we played our part,” said Hancock.

Last week, the UK became the first country to vaccinate people with a coronavirus treatment that has been fully tested.

Margaret Keenan, then 90, made history as the first person in the world to receive the Pfizer BioNTech vaccine outside of the experimental conditions.

It is now being given out to front-line health workers, nursing home workers and those over the age of 80 before it becomes more widespread among the UK population.

It is hoped that a safe and effective vaccine can help end the coronavirus pandemic.

To date, more than 72.3 million people worldwide have become infected with Covid-19, with 1.61 million deaths, according to Johns Hopkins University.

– CNBC’s Holly Ellyatt contributed to this report.