Watchdog says LSE safe

Watchdog says LSE safe

The Securities and Exchange Commission has emphasised that Sarbanes-Oxley would not apply to UK listed firms in the event of a US takeover of the London Stock Exchange

The body hinted that Treasury secretary Ed Balls overreacted when he
announced radical plans to ring-fence the London capital markets regime from
Sarbanes-Oxley regulation.

‘Joint ownership of a US exchange and a non-US exchange would not result in
automatic application of US securities regulation to the listing or trading
activities of the non-US exchange. You can’t be subject to US rules unless you
either raise capital or provide financial services in the US,’ SEC spokesman
John Nester said.

In a speech made last week, Balls said the UK would introduce legislation
allowing the UK’s Financial Services Authority to veto any regulatory changes
proposed by a foreign owner of the London Stock Exchange.

The announcement came amid fears that with New York-based exchange Nasdaq
courting the LSE, the light regulatory touch of the UK markets could be at risk
and overrun by Sarbox regulation.

The US regulator would not comment directly on the Balls’ speech.

For Ed Balls’ full speech see hm-treasury.gov.uk

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