Britain has proposed a loosening of rules on stock market listings by state companies, just as the London Stock Exchange is trying to win the IPO of Saudi Arabian oil giant Saudi Aramco, a potentially huge but controversial prize.
The new rules proposed by Britain's financial watchdog would create a new listing category for companies controlled by sovereign states and come as exchanges around the world are vying to win the Aramco listing, which is expected to be the largest initial public offering (IPO) ever.
But the Financial Conduct Authority (FCA) proposals are likely to spark criticism from British fund managers, who have already expressed concerns about Aramco's governance.
British asset management body the Investment Association said in May that it was concerned that Aramco would be granted exemptions that could weaken the influence of minority shareholders.
Reuters reported earlier this year that the London Stock Exchange Group was working on a new type of listing structure that would make it more attractive for Aramco to join the bourse.
The proposals come as the government and City of London are trying to keep Britain's financial markets attractive to international investors and companies after the country leaves the European Union.