By Huw Jones

LONDON (Reuters) – Britain will “modernise” its listing rules to attract more high-growth and “blank cheque” SPAC company flotations to London, Finance Minister Rishi Sunak said on Tuesday.

The London Stock Exchange is facing tougher competition from NYSE and Nasdaq in New York, and from Euronext in Amsterdam since Britain fully left the European Union on Dec. 31.

In a bid to keep London globally competitive after Brexit, Sunak commissioned a review of listings rules last November. It was led by former European Commissioner Jonathan Hill and will publish its recommendations on Wednesday.

“The review has more than delivered and I’m keen we move quickly to consult on its recommendations, cementing the UK’s reputation at the front of global financial services,” Sunak said in a statement.

The government faces pressure to act – it announced a fast-track work visa scheme last week for fintechs – after swathes of euro stock and swaps trading left London for Amsterdam and New York after full Brexit in December.

But asset managers and company directors warn about eroding corporate governance standards by easing listing rules.

“The recommendations in this report are not about opening a gap between us and other global centres by proposing radical new departures to try to seize a competitive advantage,” Hill said.

“They are about closing a gap which has already opened up. All the recommendations are consistent with existing practices in other well-regulated financial centres in the USA, Asia and Europe,” Hill added.

Two changes seek to move London in line with New York and other financial centres by allowing founders to list their company while still retaining significant control.

As widely trailed, Hill recommends allowing dual class share structures to give directors and founders enhanced voting rights on certain decisions, a move retail investor groups say is contrary to the “one share, one vote” principle. The minimum “free float” or amount of a company’s shares or in public hands would be cut from 25% to 15%.

Hill also recommends liberalising listing rules for special purpose acquisition companies or SPACs, whose flotations in New York have surged over the past year, with Amsterdam also attracting some recently.

The prospectus, used by companies to set out their initial or secondary offer of shares, should also be fundamentally reviewed, Hill has recommended.

There should also be an annual “State of the City” report form the finance minister to parliament on the financial sector’s competitive position.

“Continuing to evolve the UK listings regime is key to providing flexibility for companies who want to list in London while maintaining high standards of corporate governance,” said David Schwimmer, chief executive of the LSE Group.

(Reporting by Huw Jones; editing by David Evans)