Details have emerged regarding Baroness Sharon Bowles’s Private Members Bill (PMB) on the classification of investment trusts.
In a speech to the House of Lords on Monday (22 July), Bowles said that the investment trust sector had lost “£30bn and counting” through the “glitch” of cost disclosure rules for investment trusts.
The bill, entitled ‘A Bill to make provision about listed investment companies; the classification and characteristics of those companies; and for connected purposes‘, will be introduced in the House of Lords on Thursday 5 September.
The PMB will focus on recognising the role of markets and share prices in setting the value of listed investments, which will see investment trusts treated as a going concern in the making of FCA rules and disclosure presentation, and the removal of investment trusts from the Consumer Collective Investment Directive.
See also: Can we expect broader consolidation among investment trusts?
The trust sector has previously highlighted problems with the application of current rules, under which investment companies are required to disclose charges in the same way that unit trusts are, leading to a misleading representation of costs for closed-ended funds.
Bowles called on the new treasury minister, Lord Livermore, to meet with her in order to discuss the PMB.
Responding to Bowles, Livermore said he “continues to believe” that Bowles makes a “persuasive case for action”, and the government will “consider all options available to address the issues she raises”.
Bowles also recognised the efforts of baroness Ros Altmann, who’s similar PMB had received cross-party support but was not passed in time before the general election earlier this month.
See also: UK income and small-cap trust discounts halve in 2024
