LONDON (Reuters) - Britain's financial regulator dismissed a newspaper report that it was considering sidestepping new EU rules on banker pay under which only up to 30 percent of a bonus can be paid up front.

The Financial Services Authority (FSA), which oversees Europe's largest banking centre in London, said it had no plans to seek an exemption from European rules on banker pay approved by European Parliament members on Wednesday.

"It's not true," an FSA spokeswoman said. "We are (still) reviewing the EU text to see what it means for our remuneration code. We have already committed to review (our code) this year anyway and we will obviously factor in the EU text."

The Telegraph newspaper said FSA lawyers were exploring the possibility of claiming an exemption because Britain's financial sector was adequately regulated by its own code.

Under the FSA's latest code of practice affecting large financial institutions, it has banned guaranteed bonuses of more than one year and said two-thirds of bonuses should be spread over three years to discourage short-term decision making.

Lawyers said the FSA was highly unlikely to challenge the new rules, which are based on principles outlined by the Group of 20 leading nations, as the watchdog was already implementing them through its own code. They also said the EU rules were expected to give member states some room for interpretation.

"I'm sure it (final EU text) will give considerable latitude to individual countries as to how they implement it, either explicitly ... or by using the word 'bonus', 'pay' or 'senior manager' and not defining that term further," said Nicholas Stretch, a lawyer from CMS Cameron McKenna in London.

The FSA has said banks in Britain are already complying with last year's code on bonuses and that it will monitor implementation each year.