Tuesday, June 18, 2024
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City regulators relax floating rules to attract tech companies


he city Watchdog Move today to relax listing rule strengthen LondonFor fear that it will lose out to competitors, especially New York, its attractiveness as a technology center.

The strict rules of dual equity make the owner/entrepreneur While maintaining control of the business, the practice of selling shares on a floating basis seems to be eased. This radical move may make the city veteran uneasy.

The Financial Conduct Authority today launched a consultation based on the UK listing review led by Lord Hill and the UK’s Kalifa review Fintech, Both advocate a thorough reform of the rules.

This FCA It is consulting on plans to reduce the number of shares of listed companies that must be held by the public from 25% to 10%. This should increase London’s appeal to “unicorn” technology companies seeking to raise funds.

Clare Cole, FCA’s Director of Market Surveillance, said:

“Effective public markets are essential for companies to finance their businesses, which in turn creates growth and jobs for the UK economy. These recommendations are essential if we intend to make the UK continue to be a modern and vibrant market Yes. Today, we are taking decisive action to meet changing market demands.”

FCA plans to move quickly. It will conduct 10-week consultations and formulate new rules before the end of this year.

The purpose is to expand the scope of companies listed in the UK.

Cole added: “They are designed to encourage high-quality companies to go public early, thereby increasing the likelihood that a broader investor base will be able to capture the growth of these companies.”

FCA’s data shows the scale of the problem the watchdog is trying to solve. Between 2015 and 2020, the United Kingdom accounted for only 5% of global IPOs, and for the second-largest financial center after New York, returns are not good

Critics of these measures might argue that London attracts most of its business precisely because it has a strict legal and regulatory framework that ensures a higher level of investor protection than elsewhere.

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