A key committee of Euro MPs is preparing to vote on a controversial new directive regulating hedge funds and venture capitalists.
London-based fund managers have said the proposals will make it impossible for funds based outside the EU to raise money within Europe.
The US government has argued those plans are protectionist.
Britain's new government wanted to delay the vote, but a report suggests efforts failed.
The European Parliament's economics committee is set to vote on the legislation on Monday evening, then EU finance ministers will discuss it on Tuesday. The parliament and member states' governments have equal powers to shape the new regulations.
Hedge funds use sophisticated, complex investment strategies to make returns, and often make money when markets are falling.
London mayor's warning
They are more important to the UK than almost anywhere else in Europe. It is estimated that 80% of Europe's hedge funds are based in London, and about a quarter of the world's such businesses.
The Mayor of London, Boris Johnson, has said in the past that EU plans to regulate the funds could "strangle" London as a financial centre.
The legislation seeks to: limit the rewards paid to hedge fund managers; impose new marketing rules on non-EU hedge funds in Europe and on EU hedge funds investing outside of the EU; ban naked short-selling - that is, selling shares that the seller does not yet possess.
The legislation also seeks to curb highly-leveraged funds - that is, funds that borrow a high multiple of their capital to increase the size of their investment.
The European Commission wants new rules to overcome what it sees as gaps and inconsistencies in existing, national regulatory frameworks.
It has already delayed one vote - taking it off the agenda at a meeting in March - after Britain's former Prime Minister Gordon Brown persuaded EU officials that more time was needed to reach a consensus.
However, the Financial Times said British diplomats failed in their attempt to persuade the French and German governments that the new UK government also needed more time to prepare for the meeting.
French President Nicolas Sarkozy and German Chancellor Angela Merkel have been keen for some time to introduce greater regulation for the private equity and hedge fund sectors - which many say played a part in the global financial collapse.
Spain currently holds the EU presidency, and its finance minister Elena Salgado told the FT that other finance ministers would not agree to a delay.
"There is a very clear majority of countries that want to approve it," she said.
Critics of the proposed changes say that, if approved, the laws would see many funds flee London to Switzerland or elsewhere outside the EU.