The U.K. unemployment rate rose in July, ending a streak of seven consecutive months of unchanged or declining jobless levels that confounded economists, and adding to an outlook of economic gloom for Britain's contracting economy, The Wall Street Journal reported. The Office for National Statistics said Wednesday that in the three months to the end of July, the number of people without jobs grew by 28,000 from the same period ending in June, pushing the unemployment rate to 8.1% from 8.0% the data showed.

Britain faces a fresh fight with Brussels over who has control over the City of London, as it confronts a key element of the plans for eurozone banking union that makes it easier for London to be overruled on contentious matters of supervision, the Financial Times reported. In a proposal that will cause alarm among eurosceptic MPs, the European Commission will on Wednesday unveil reforms that strengthen the European Banking Authority, which co-ordinates rulemaking between the EU’s national supervisors.

Burberry Group PLC issued a surprise profit warning on Tuesday and reported its worst same-store sales figures since the financial crisis, raising concerns about a slowdown in the luxury sector, where companies are feeling the pangs of a decelerating China and macroeconomic uncertainty world-wide, The Wall Street Journal reported. The British fashion house, known for its classic trench coats and Haymarket check, is scheduled to report full quarterly sales figures in October.

State-controlled Royal Bank of Scotland said on Monday it would use the government's new flagship lending scheme to offer cheap funds to manufacturing companies, in a first move to put the scheme into action, Reuters reported. Britain launched its 'funding for lending' (FLS) plan in June as part of efforts to lift the economy out of recession, making 80 billion pounds of cheap loans available to banks provided they go to households and businesses.

Bulgarian telecoms operator Vivacom obtained UK court approval to proceed with a 1.7 billion euro ($2.1 billion) debt restructuring, ending two years of wrangling with lenders and failed attempts to sell the company, Reuters reported. Under a deal approved by Mr Justice Vos in a hearing at the High Court in London, Russia's second-biggest bank VTB Capital and Bulgaria's Corporate Commercial Bank (CCB) are buying over 70 percent of Vivacom and existing lenders are writing off 1 billion euros of debts.

Despite complaints from insolvency practitioners that staff and budget cuts at the Insolvency Service are allowing unscrupulous directors to escape justice, the Department for Business, Innovation and Skills shelved an initiative to streamline the process for reporting misconduct, The Telegraph reported. The Government said a drive to reduce red tape for the smallest companies was behind the decision.

Debt-mired JJB Sports put itself up for sale on Thursday and warned investors their shares may be worthless, placing the sports goods retailer at risk of becoming another big-name British retail casualty, Reuters reported. The company has been rocked by funding issues, falling sales and stiff competition as UK store chains battle weak consumer spending, muted wage growth and government austerity measures. A string of household retail names including Woolworths and MFI have gone out of business in recent years, undermined by price-cutting from supermarkets and the Internet.

Barclays Plc (BARC) faces a criminal probe into fees it paid in 2008 to Qatar’s sovereign wealth fund as the bank sought to raise money to avoid a government bailout, Bloomberg reported. The Serious Fraud Office, which prosecutes bribery and white-collar crime, told the London-based bank it has “commenced an investigation into payments under certain commercial agreements between Barclays and Qatar Holding LLC,” the lender said in a statement today. The investigation is another legal pitfall for Britain’s second-biggest lender by assets after it paid U.S. and U.K.

Britain's wealthiest people should face an emergency tax to avoid a breakdown in social cohesion as the country fights an "economic war" caused by a longer than expected recession, Nick Clegg has said. In the first interview by a senior member of the cabinet to mark the new political season, the deputy prime minister told the Guardian he is embarking on a battle to persuade his Tory coalition partners of the need to ensure the rich shoulder a greater burden of the economic pain.

Mouchel, the motorway maintenance company, has sold its assets to a new company owned by banks and management, ensuring the survival of the 120-year-old business, the Financial Times reported. KPMG, the administrator, said on Saturday that the assets had been sold to a newly incorporated company, MBRL Ltd, whose lenders include Barclays, Royal Bank of Scotland and Lloyds Banking Group. The banks will wipe out £83m of debt in exchange for an 80 per cent stake in the new, delisted company, while the existing management will own the remaining 20 per cent.