Call to re-examine rules on solvency

In its submission to a Government consultation on corporate ownership, the CBI said the Government needs to re-examine solvency and other accounting rules. It added tax should ensure a level playing field for equity ownership and progressively reward long-term investment in shares.

Matthew Fell, CBI director of competitive markets, said: "The focus of this consultation should be on the health of the UK economy and its recovery, which depends on business growth and prosperity. This means making the UK an attractive place to invest for domestic and foreign companies. But, there are issues that do need to be addressed to encourage more long-term investment, particularly changes to solvency and accounting rules, and to the tax system.

"There is also a need to establish greater clarity around the areas covered by the 'public interest' test. New takeover rules must prioritise transparency and certainty around bids."