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PLUS Markets Group plc (“PMG”) announced yesterday that it intends to apply to the Financial Services Authority (“FSA”) for Recognised Investment Exchange (“RIE”) status. The move will significantly enhance PMG’s development potential, underpin its substantial long-term growth plans and enable it to compete further across a wider range of equity market services.
The news was formally announced as PMG released its interim results for the half year to 30 June 2006, in which it also confirmed the full implementation of its extended trading platform offering, its successful penetration into new market segments and a significant increase in the number of market members.
In making this application, PMG seeks to accelerate the recent successful extension of its business model by developing into a full service stock exchange. Simon Brickles, CEO, said “RIE status is the logical next step for PLUS Markets Group. The marketplace for equity trading is increasingly international, both in the context of global exchange competition and consolidation and given the forthcoming introduction of the Markets in Financial Instruments Directive (“MiFID”). RIE authorisation is a benchmark standard and will enhance PMG’s cross-border status and reputation, help raise its profile and brand recognition in international markets and help us deliver a superior service for our users.”
Specifically, RIE status will further enable PLUS Markets Group to realise new business opportunities as it pursues substantial long-term growth plans. It will lead to the introduction of a much broader range of primary market products and services, and attract an increased range of specialist issuers to PLUS, offering, for example, investment trusts and REITS. RIE status also confers additional benefits, such as the tax treatment of certain products consistent with other regulated markets.
Similarly, MiFID will create a uniform regulatory landscape for Europe and PMG will be able to slot efficiently into this new regime as an RIE. Conditional upon its RIE application being granted, PMG expects to be classified as a Market Operator under MiFID, and consequently to hold the requisite permissions to operate the full spectrum of EU regulated and exchange-regulated markets envisaged by the new directive.
PMG expects to submit its application shortly. The process for the review of an RIE application under applicable statutory procedures is usually completed within six months of the submission of final documentation, subject to the discretion of the FSA.
