The Market Participants Consultative Panel held its ninth meeting on 14 June 2005 in Paris. The discussion was primarily focused on problems of listing of EU companies in US exchanges and the exercise of corporate rights in investment management. The discussion on problems of listing of EU companies in US exchanges focused on the problem of delisting and deregistration, the impact of the SOA and the EU and US accounting regimes.
It was noted that since the adoption of the SOA very few non-US companies have sought listing on US exchanges. Experience has shown that dual listing for EU companies is becoming less attractive for a range of different factors. New solutions should be discussed and agreed with the US Authorities to allow European companies to deregister, once they had de-listed their shares. These might include raising the number of US investors that own the shares of EU companies or to adopt the criteria of trading volume. The latter criterion would be preferable as it is very difficult to demonstrate that the number of US shareholders is below a certain threshold.
On the second aspects, associations will conduct a survey of consequences on EU listed companies to evaluate costs incurred for compliance with the SOA by EU companies. This data will be supported by statistics on the decreasing number of new companies listed in the US Exchanges, to show that US markets are becoming less attractive for EU companies.
It was also noted that the main problem of the Sarbanes Oxley Act lies in the cultural gap between Europe and the US in the approach to management of companies.
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