November 14, 2019
Business

Labour MP tells City watchdog to reconsider Rosneft’s London listing

The City watchdog should reconsider the legitimacy of oil major Rosneft's listing on the London Stock Exchange, according to prominent MP Stephen Kinnock.

The Labour MP has written to the Financial Conduct Authority arguing that the listing “undermines the credibility and integrity” of the Square Mile.

Kinnock calls on the watchdog's boss Andrew Bailey to "assess the legitimacy and legality of Rosnefts position on the LSE".

The letter, seen by City A.M., cites a number of concerns with the company, which listed in 2006, including its inclusion on both US and EU sanctions lists and the closeness of chief executive Igor Sechin with Russian President Vladimir Putin.

"I believe the FCA has a critical role to play here," Kinnock wrote. "In light of Mr Putin's contempt for the rule of law and Rosneft's central role as an agent of Kremlin power, your duty to protect the integrity of the UK financial system faces a new and urgent threat."

He told City A.M.: "It is quite absurd that a company that sits on both the US and EU sanctions list is on the London Stock Exchange.

"Ultimately it is up to FCA – its their job to look into these issues, to look at the standards by which LSE lives and decide whether or not every company lives up to those standards. But they must take another look at this again, a lot has happened in the last 12 years."

He added: "Parliament has understood that the country allowed things to go too far; our institutions were too welcoming. Now is the time to put things right, and Im sure that both the FCA and LSE would want to help with that."

Tom Tugendhat, chair of the Foreign Affairs Committee, told City A.M.: "There is an increasing focus on individuals making sure that they and their companies sources of income are absolutely clean.

"The tolerance that existed before has diminished in light of a number of different things, not least the increasingly rogue behaviour of the Russian state and the aggression of the Kremlin regime."

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Rosneft was sanctioned by the EU in 2014 and 2015 for Moscows role in Ukraines crisis. Sanctions include restrictions on the supply of goods and services for use in the Arctic, deepwater and shale projects and in oil production in Russia.

Rosneft is challenging the sanctions in the European General Court and in the High Court of Justice of England and Wales. In March last year the European Court of Justice upheld the sanctions.

Rosneft could not be reached for comment.

The London Stock Exchange declined to comment.

A spokesperson for the FCA said: “We have received the letter and will respond.”

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