Hong Kong is continuing with its
consultation for dual-class shares as it targets to allow
firms with weighted voting right structures and
pre-profit biotechnology companies to list on the Hong Kong
Stock Exchange and allowing qualified issuers to seek a
secondary listing on the HKEx. It is aiming to accept
applications for dual class shares listings at the end of
April.
On the other side of the Chinese border, the Shanghai
Stock Exchange has indicated that it is developing a package
of services that aim to attract more technology unicorns,
those that are unlisted and valued at more than $1 billion.
The exchange is engaging with multiple technology firms to
access the Shanghai capital markets. Over in Shenzhen, which
is home to numerous Chinese technology companies, the
Shenzhen Stock Exchange is also in conversation with the
Chinese Securities and Regulatory Commission to get the ball
rolling on drafting new rules to attract more domestic
technology company listings.
Turning offshore,
Chinese acquisitions of foreign targets are facing an
increasing amount of hurdles including regulatory
obstacles, capital outflow and approval restrictions, and
deal approval uncertainty from the US Committee on Foreign
Investment in the United States (Cfius). Deal activity in
this area has slowed down, with buyers thinking twice about
snapping up US targets.
Americas: in with the new
President Trump fired his secretary of state Rex
Tillerson, replacing the ex-Exxon man with CIA director and
former Tea Party congressman Mike Pompeo. In the following
days, the President held back no punches on the international
scene, dropping a new round of sanctions on Russia for its
role in cyber attacks and election meddling.
Trump also moved to
block Broadcom's bid for Qualcomm, an unprecedented move by
the government which usually waits for the deal to be
announced and undergo a full review by Cfius. He cited
national security concerns as the reason, although the
decision came across as a sure signal of economic
protectionism.
In the Senate,
the banking bill that will loosen much of the restrictions
put in place by the Dodd-Frank act in 2010 was passed,
giving breaks to small institutions with less than $250
billion in assets. The bill gained bipartisan support;
further moves to roll back the act will no doubt feature in
future weekly accounts going forward.
The Department of Labor had an important victory in the US
Court of Appeals for the 10th Circuit against Market Synergy
Group, an insurance distributor, who had claimed that it
treated fixed indexed annuities differently from fixed
annuities under its fiduciary standard rule. Elsewhere
Securities and Exchange Commission (SEC) commissioner Hester
Peirce suggested that the SEC's own version of the
much-maligned rule is due this year, and it will require all
brokers to make disclosures.
EMEA: a tight grip
A US district court judge has
ruled that cryptocurrencies can be regulated as
commodities, bringing them into the remit of the
Commodities Futures Trading Commission's (CFTC). This means
that the CFTC can go ahead and investigate Coin Drop Markets
and New York resident Patrick McDonnell on fraud charges
involving the trade of virtual currencies bitcoin and
litecoin. The decision is expected to see an increase in
enforcement action from the CFTC, following two high-profile
actions brought recently. The news echoes advances made in
France last week, as
the EU member state's financial regulator announced that
cryptocurrency derivatives should be regulated just like any
other financial instrument and therefore online platforms
offering these are included under the new Markets in
Financial Instruments Directive (Mifid II).
It is almost two years since the Senior Managers
Certification Regime (SMCR) was implemented. In conversation
with IFLR,
Fox Williams partner Joanna Chatterton said that some senior
managers are accelerating retirement plans because of the
regime. Bankers are said to be uncomfortable stepping
into the shoes of regulators and the documentation required
could potentially make breaches under the General Data
Protection Regulation (GDPR) are the more likely.
With just over two months until the implementation date
for the General Data protection Regulation, businesses are
racing to finish preparation.
But many non-EU firms do not realise that they also have to
prepare just as much as EU firms and probably do not have the
time to meet the deadline. Global head of Axiom's
regulatory practice, Mathew Keshav Lewis, said that data
centres are being set up in Europe because of the onerous and
complex requirements. If all FTSE 100 companies would be
polled on their compliance, Lewis predicts none would be
fully compliant currently.
See also
In the news this week (week c/ March 5)
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