TRANSPARENCY

Almost all information filed with the registrar is publicly available. An example of information filed with the registrar that is not available to the public is certain personal information about directors. Since the advent of electronic communication, the law generally permits the communication of information, including filing documents with the registrar, by email. Certain types of companies are also required to make certain information available on the company’s website. Beyond core company law disclosures, additional disclosure obligations apply to companies with securities admitted to trading on a stock exchange. Different levels of disclosure apply depending upon to which particular stock exchange and market a company’s securities are admitted to trading. Additional disclosures, beyond those required by the Companies Act 2006, will be required either by law (the Financial Services and Markets Act 2000 and rules promulgated by the Financial Services Authority pursuant to that Act, including the Disclosure and Transparency Rules), by the rules of the market (such as the London Stock Exchange Admission and Disclosure Standards) or, usually, by a combination of both. The UK Corporate Governance Code (‘the Code’) exists in the grey area between enacted law and industry self-regulation. No company is obliged as a matter of law to comply with the Code. However, a company (whether a UK or overseas company) with a Premium Listing of its equity shares on the London Stock Exchange Main Market is subject to the highest level of public disclosure (based on the law) and is required to comply with Listing Rules 9.8.6R(5) and (6). These two paragraphs contain what is referred to as the ‘comply or explain’ obligation. LR 9.8.6R(5) requires a company to include in its annual financial report a statement of how the company has applied the Main Principles set out in the Code, in a manner that would enable shareholders to evaluate how the principles have been applied. LR 9.8.6R(6) requires a company to include in its annual financial report a statement as to whether the company has complied throughout the year with all relevant provisions set out in the Code or not and, if it has not, the provisions it has not complied with, the period within which it did not comply and the company’s reasons for non-compliance. The various levels of public disclosure imposed by securities regulation are beyond the scope of this book. Only a very brief outline of the scheme of periodic disclosure imposed by the Disclosure and Transparency Rules (DTR) as well as the obligation to disclose price-sensitive information is included in section 17.3.