§ Mr. IrvineTo ask the Scretary of State for Trade and Industry what steps he is taking to facilitate the introduction of electronic recording and transfer of shares.
§ Mr. RedwoodSection 207 of the Companies Act 1989 gives me power to make regulations to enable title to securities to be evidenced and transferred without a written instrument. The international stock exchange (ISE) has published proposals for the introduction of TAURUS, its scheme for recording and transferring shares electronically in October 1991, and I am therefore considering the form of the regulations which I should make.
I welcome developments that improve the international competitiveness of the United Kingdom as a financial centre. However, the introduction of electronic share transfers will also affect the way in which companies can meet their obligations, and change the manner in which investors hold shares. Striking the right balance between the interests of investors, companies and market participants may not be easy and I would like to hear the comments of a wide range of interested parties before reaching decisions on how to proceed.
I am today publishing a consultative paper which describes the proposed legal framework for TAURUS, and seeks views on how different rights and obligations should be handled by statutory provisions or by the appropriate regulatory bodies. Comments are invited by 14 September. I am arranging for a copy of the paper to be placed in the Library of the House.