Labour in Promise to Keep LSE's Light Touch

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THE government won friends in the City by promising to safeguard the London Stock Exchange's 'light touch' regulatory regime in the event of a foreign takeover.

This will allay concerns by traders and companies listed on the LSE that a takeover by US-bourse Nasdaq could result in the dreaded Sarbanes-Oxley laws coming to Britain.

It also clears up any uncertainty over the power of a new owner to change the status quo, which could smooth the way for a takeover.

Treasury Secretary Ed Balls said the government will legislate to give extra powers to the Financial Services Authority.

This will enable it to 'outlaw the imposition of any rules that might endanger the light touch, risk-based regulatory regime that underpins London's success'.

In the aftermath of Enron and WorldCom, American firms have been buckling under the burden of numerous regulations designed to prevent future accountancy scandals.

This is partly why the UK has been the destination of choice for many foreign firms looking for a stock market listing such as Eastern European miners and online gambling firms - though some might argue that this is not always a good thing. …