Financial secretary Ruth Kelly issued this warning in a report from a Commons scrutiny committee, in response to a draft EU Transparency Directive.
The committee is demanding a detailed government response to the proposed legislation, brought in under the EU’s Financial Services Action Plan.
The directive is built on the International Accounting Standards Regulation, which requires EU-incorporated companies, whose securities are traded on regulated markets in the EU, to conform with internationally agreed rules.
The directive would set more demanding timetables for financial reporting and require more frequent periodic reporting and the disclosure of changes to major shareholdings.
It would also change the jurisdictional basis for some issuers of securities from that of the market in which they are traded to the state of incorporation, which Kelly warned would prevent host states from adding to the disclosure requirements and might require the UK listing regime to be modified.
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