30 Nov 2008

Taskforce urges urgent relaxing of money-raising rules

4:48 pm on 30 November 2008

A Government taskforce says urgent action needs to be taken to make it easier for businesses to raise money in the face of the international financial crisis.

The Capital Market Development Taskforce has written to Commerce Minister Simon Power recommending a series of changes it says should be put in place by March.

Taskforce chairman Rob Cameron warns that the recession could be much worse if local businesses are not able to raise capital to keep themselves afloat.

His taskforce wants the rules on raising capital, particularly through the issuing of shares, relaxed.

It says companies should not be required to issue costly investment statements and prospectuses before going to the markets to raise money.

The new Minister of Commerce Simon Power is reacting favourably to the plans.

Mr Power says it makes sense to ease capital raising rules, as long as protections remain in place to safeguard investors.

Mr Power plans to discuss the suggestions with the chairman of the taskforce and with his cabinet colleagues before going further.