The Recent Evolution of the English Collective Redress Mechanism: Is the UK Regime Adapted to Investors?

Journal des Sociétés, Forthcoming

Posted: 12 Jun 2011

See all articles by Arad Reisberg

Arad Reisberg

Brunel University London ; Brunel University London - Brunel Law School

Date Written: December 9, 2011

Abstract

A common feature of securities laws in developed countries is that they provide various types of private actions to enforce securities laws. In some countries recent law reform activity has added to the range of private law remedies available to investors. This trend suggests that policymakers are receptive to the view that laws facilitating private enforcement benefit stock markets. Yet the incidence of private enforcement actions varies considerably from country to country. This has the consequence that nationally-focused debates can have different priorities: whereas in some countries the most pressing questions may be about curbing private enforcement so as to protect international capital markets competitiveness, in others, the priorities may be about what more needs to be done to ensure that civil enforcement evolves beyond ‘law on the books’ to become an important actively-used mechanism of investor protection.

In this respect, the UK has recently enacted a new dedicated civil liability regime in respect of issuer disclosures. A significantly wider statutory liability regime for issuers came into force on 1 October 2010. The changes are particularly important for issuers with securities traded in the UK, or which have the UK as their home state. The original regime has been expanded in a variety of ways. The new liability regime covers not just periodic financial disclosures that are required under the EU Transparency Directive but all information published, or the availability of which is announced, using an RIS. It also permits recovery in respect of losses caused by dishonest delay and give a right of action to sellers and those who continue to hold securities as well as to purchasers.

Section 3 provides a brief outline of the new regime. The regime is then described and analysed in section 4. Section 5 turns to deal with procedural aspects and feasibility of class actions under the regime. Finally, implications from the preceding discussion will be drawn in Section 6.

Keywords: UK, statutory regime, issuer liability, class actions

Suggested Citation

Reisberg, Arad, The Recent Evolution of the English Collective Redress Mechanism: Is the UK Regime Adapted to Investors? (December 9, 2011). Journal des Sociétés, Forthcoming , Available at SSRN: https://ssrn.com/abstract=1861489

Arad Reisberg (Contact Author)

Brunel University London ( email )

Kingston Lane
Elliott Jaques Building
Uxbridge, Middlesex UB8 3PH
United Kingdom

HOME PAGE: http://www.brunel.ac.uk/people/arad-reisberg

Brunel University London - Brunel Law School ( email )

Kingston Lane
Elliott Jaques Building
Uxbridge, Middlesex UB8 3PH
United Kingdom

HOME PAGE: http://www.brunel.ac.uk/people/arad-reisberg

Do you have negative results from your research you’d like to share?

Paper statistics

Abstract Views
775
PlumX Metrics