Government rejects Takeover Panel plea on Bill
The Government has rejected a call from the City Takeover Panel to amend the Financial Services and Markets Bill to prevent the Financial Services Authority intervening in takeover battles except when specifically asked by the Panel to do so.
The Panel believes the Bill, as drafted, would lead to advisers in contested bids seeking to drag the regulator in at every juncture in order to gain tactical advantage. It is now considering whether it should seek the support of opposition peers to amend the Bill.
The Bill is going through its House of Lords committee stage and is expected to go to its third reading after Easter.
The Panel's City supporters maintain that the introduction under the Bill of a new market abuse regime policed by the FSA means there is huge overlap between the two bodies which the parties in bid battles will be increasingly tempted to exploit.
They warn that this will result in delays, and an increased risk of conflicting rulings blunting the Panel's authority and prolonging the agony for companies under siege.
Patrick Drayton, the secretary general of the Panel, said yesterday: "The Bill creates a parallel jurisdiction which will undermine the effectiveness the panel system."
However, the Treasury believes the Panel's fears are exaggerated. A spokeswoman said yesterday: "The whole point of the Bill was to create a single regulator. It is counterproductive to start divesting that into another body. We don't think the amendments add anything."
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