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Financial Disclosure: Davies Review

Volume 692: debated on Monday 4 June 2007

My honourable friend the Economic Secretary to the Treasury (Ed Balls) has made the following Written Statement.

My Written Statement of 26 October 2006 announced the appointment of Professor Paul Davies QC, the Cassel Professor of Commercial Law at the London School of Economics, to conduct a formal review of the liability of issuers in respect of damage or loss suffered as a consequence of inaccurate, false or misleading information disclosed by issuers or their managements to financial markets (including to their own shareholders or bondholders) or of failure to disclose relevant information promptly or at all. My Written Statement of 26 January 2007 set out the review’s terms of reference.

Professor Davies has today published his final report and copies are available in the House Library and the Vote Office.

The review recommends that the Government should maintain a statutory regime for liability in damages of issuers in respect of financial disclosures and that changes should be made to extend the regime currently set out in Section 90A of the Financial Markets and Services Act 2000. Accordingly, the Government will consult fully on their response to the review’s proposals and publish a full regulatory impact assessment of these proposals.