AIM Firms Warn Against Increased Regulation

by Philip Morton, Investors Offshore.com

02 June 2003

Accounting firm PKF's survey of the UK's Alternative Investment Market (AIM), published last week, revealed concerns that increased regulation of the junior market could jeopardise its attractiveness to listing companies.

Having questioned some 222 chairmen and chief executives of AIM-listed companies, PKF revealed that around 89% of AIM companies are opposed to quarterly reporting proposals, and 85% do not want an independent review of prospectuses.

The majority of the company executives surveyed believed that the current level of regulation for the Alternative Investment Market is about right, the accounting firm revealed, but those who did not wanted less regulatory oversight, not more.

'These findings seem to endorse the consideration currently being given by the London Stock Exchange to make AIM an unregulated market and hence, outside the jurisdiction of the proposed European Prospectus Directive,' PKF suggested last week.

However, the survey also revealed that 81% of respondents feel that they know little or nothing about the EU Prospectus Directive, set to come into force soon.

According to PKF, the new European legislation: 'could result in the removal of AIM's cost advantages by placing the same listing requirements on companies joining the junior market as those joining the Stock Exchange's Official List.'

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