FSA reveals CfD plans
2 July 2008

Written by Harriet Wigmore

The FSA has decided that a general disclosure regime for long contracts for difference (CfD) positions will be employed as the most effective way of dealing with fears in relation to voting rights and corporate influence.

The announcement comes after responses from a wide range of interested parties on its November 2007 CfDs Consultation Paper. In the same company, current share and CfD holdings should be aggregated for disclosure purposes. In line with the current exposure regulations, the disclosure threshold will be three per cent – however, the FSA will create an exemption for CfD writers as they work as intermediaries.

This September, the FSA will publish a Policy Statement with a Feedback Statement on the consultation responses, together with draft rules to implement the proposal. The FSA will be accepting technical comments on the rules to ensure they are realistic despite the fact that the position has now been finalised.

Alexander Justham, FSA’s Director of Markets said: “Our goal is to provide an effective and proportionate disclosure regime that works for all involved, and sustains market confidence and efficiency.”