And will vote on new hedge fund regulations on Tuesday.

British diplomats failed in their desperate rearguard action to delay the vote on new European legislation that London-based hedge funds and private equity firms fear could drive them out of business.

EU countries led by France and Germany plan to push through The Alternative Investment Fund Management directive next week.

This could be an interesting early test for David Cameron’s new coalition government. They may draw some comfort from US hostility to the EU proposals – Tim Geithner, US Treasury secretary, warned EU officials in March that, if unchanged, the new rules could trigger a transatlantic rift by unfairly locking US funds out of European markets.

The AIFM proposes forcing hedge and private equity funds to cap their leverage, reveal more information to investors and regulators, and have their assets held in safe custody and valued independently, among other unpleasantness for Hedgies. There is also a proposal to bar funds that do not comply from taking European investors’ money – that’s what’s has got Tim Geithner jumping up and down.

Tuesday blues on the cards.