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25 May 2021

FT: Sunak to propose powers to block London listings on security grounds

Move comes as government concerns mount over ‘dirty money’ flowing through the City

Chancellor Rishi Sunak is to set out plans to block companies from listing on the London Stock Exchange on national security grounds as government concerns mount about “dirty money” in British financial markets.

Sunak will launch a consultation within the next fortnight setting out proposals for a tougher regime governing flotations on the LSE, the Treasury said. Decisions over the eligibility of companies to list in London are currently made by the UK Listing Authority, part of the Financial Conduct Authority. Sunak is understood to want to beef up those powers by including a fresh assessment of national security considerations, which would be overseen by ministers and officials on the powerful National Security Council.

Ministers will insist that they have no particular companies or countries in mind. But MPs have raised concerns that the rules allowed Oleg Deripaska to list his energy company EN+ in an initial public offering in London in 2017. Deripaska has been accused in the past of having close ties to Russia’s president Vladimir Putin — claims he has denied — and has been subject to sanctions in the US since 2018.

The House of Commons Treasury select committee said in 2019 that it was unreasonable for a body such as the FCA to recognise any potential national security threat on its own and block a listing. The consultation will put forward proposals whereby the government could prevent a listing if it would give a foreign state access to state or commercial secrets....

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