The Financial Services Authority is debating whether to open to competition the way in which regu...
The Financial Services Authority is debating whether to open to competition the way in which regulatory information about listed companies is communicated to the market.
If the move goes ahead it will mean the Regulatory News Service (RNS), owned and operated by the London Stock Exchange, will no longer be the sole primary information provider in the UK.
Michael Foot, Managing Director of the FSA, said: "These proposals to open up the system to competition should benefit the UK equities markets by making information dissemination cheaper for the market as a whole. Listed companies should also benefit from a more transparent and fair pricing structure for their listing needs and from being able to choose the information provider that can offer them the best deal."
Foot added: "All types of investor will benefit from having instant access to all company announcements. We will ensure, under these plans, that private investors continue to have access to a single source of free or low cost full text regulatory announcements."
Regulatory announcements, such as mergers, acquisitions, financial results or directors' dealings, would subsequently be released through a choice of FSA approved primary information providers (PIPs). These approved providers will then disseminate regulatory announcements to news vendors for publication, such as Reuters or Bloomberg.
Preliminary discussions have been held with a number of potential PIPs, including the London Stock Exchange, PR Newswire, Businesswire, Hugin Online and Ubiqus. Each approved provider will be able to compete freely with other providers for the custom of listed companies.
The FSA estimates that the total cost of the proposed competitive model to the market as a whole is £3,192,000. This compares with the FSA's estimate of the total cost for RNS of £5,600,000 per annum.
The Consultation Paper 'Review of the UK Mechanism for Disseminating Regulatory Information by listed companies' is available through www.fsa.gov.uk
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