§ Mr. Tom Clarke
To ask the Chancellor of the Exchequer (1) what discussions he has had with the(a) London Stock Exchange and (b) Financial Services Authority on the alternative investment market becoming an unregulated market; 
(2) what research he has carried out on the way in which an unregulated alternative investment market would affect companies and investors; 
(3) what discussions he has had with the European Commission about the alternative investment market becoming an unregulated market. 
§ Ruth Kelly
The London Stock Exchange (LSE) is a Recognised Investment Exchange (RIE) under the Financial Services and Markets Act (FSMA) and has to operate all its markets, including the Alternative Investment Market (AIM), in compliance with the recognition requirements for RIEs. The Financial Services Authority (FSA) supervises its compliance with these obligations.
AIM is also a 'regulated market' under the EU's Investment Services Directive (ISO). This means that it complies with the standards for regulated markets set out in the directive and can do business in other member states on the basis of mutual recognition of its regulatory status in the UK.
The LSE has indicated that it is planning to consult about removing AIM from the list of EU regulated markets. If this happens, AIM would not become an unregulated market. The LSE would still be required by the FSA to meet its existing UK regulatory obligations under FSMA with respect to the way it operates AIM. But there would be no mutual recognition of AIM'S regulatory status in the UK by other member states under the ISO. Treasury officials have discussed this issue with the LSE and the FSA.625W
Because AIM is not going to become an unregulated market, the Treasury has not done any research about the impact of such a scenario on investors and issuers, nor have we discussed it with the European Commission.