LONDON Feb 14 Britain should look at developing
a new debt trading venue that could compete better with popular
markets in Luxembourg and Ireland in the post-Brexit era, the
country's financial watchdog said on Tuesday.
The proposals were set out in a Financial Conduct Authority
(FCA) review of how to make it easier to list companies, bonds
and funds to try to increase the flow of money into fast growing
industries, particularly in science and technology.
The listing regime used by the London Stock Exchange
could be "usefully reconsidered" for overseas companies, the
watchdog said - a key issue given that Britain is set to leave
the European Union and wants to maintain London's attractiveness
as a global financial centre.
Currently, foreign companies are offered several ways to
list their securities and making this more flexible would make
such companies more accessible to a wider range of investors,
the FCA said.
"This review considers some important questions about the
primary markets, and some potential enhancements, to ensure they
continue to meet the needs of investors and issuers
effectively," FCA Chief Executive Andrew Bailey said in a
The review said Britain had no market equivalent to the
Irish GEM market or Luxembourg's EuroMTF market – specialist
trading platforms focused on institutional investors and which
have achieved considerable success.
"Our soundings... suggest this might be attractive as a
'global debt' option for large, emerging market issuers without
an equity listing in the EU," the FCA said.
"The past year has seen, for example, great interest in
Rupee-dominated bonds issued to international investors in
markets outside India. Similarly, Chinese state-owned banks have
accessed EU debt capital markets."
The review also looks at whether the watchdog should take
steps to encourage the participation of small investors in bond
The watchdog said it was also examining the boundary between
a premium company listing, which requires higher standards, and
the so-called standard regime to "improve effectiveness for
issuers and investors".
The FCA said it might also ease the rules for listing
exchange-traded-funds or ETFs.
(Reporting by Huw Jones; Editing by Keith Weir)