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June 18, 2020

UK’s FRC appoints new chair of Pre-Exemption Group

By Joe Pickard

The UK’s Financial Reporting Council (FRC) has appointed Simon Fraser as chair of the Pre-Exemption Group (PEG). Fraser has been a longstanding member of the PEG and has had a long career in investment management and corporate roles, including his current role as chair of the Investor Forum.

The FRC acts as Secretariat to the PEG. The PEG’s Statement of Principles provides guidance on the factors to be taken into account by companies and investors when considering the case for disapplying pre-emption rights.

Commenting on his appointment, Fraser said: “I am very pleased to be taking on the role of Chair of the Pre-Emption Group. The rights of pre-emption are a cornerstone of the UK market.  Safeguarding investor protections, whilst helping companies access the capital markets efficiently through this extremely difficult economic period, will continue to be a priority of the group.”

FRC CEO Jonathan Thompson said:  “I am delighted that Simon Fraser has agreed to continue his involvement with the Pre-Emption Group, now as Chair. The Pre-Emption Group’s statement on additional flexibility, offered on a temporary basis, has been well-received by the market. In the current economic circumstances, the Pre-Emption Group has an even more important role to play in supporting companies, but also ensuring that the important rights to which investors are committed continue to be upheld.”

On 1 April 2020 the PEG issued a recommendation for investors to consider applying additional flexibility to company requests regarding pre-emptive issuances. This additional flexibility was put in place on a temporary basis, and the PEG continues to monitor the situation.   

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