U.S. out, London in

Foreign companies are certainly thumbing their noses at U.S. exchanges these days. The number of American Depository Receipts listed on U.S. exchanges peaked in 2001 at over 600, and has been in decline ever since, according to a report from Fortigent, a Rockville, Md.-based consulting group. Dan Trosch, author of a report from Fortigent, says more numerous listing requirements, and the burden of

Foreign companies are certainly thumbing their noses at U.S. exchanges these days. The number of American Depository Receipts listed on U.S. exchanges peaked in 2001 at over 600, and has been in decline ever since, according to a report from Fortigent, a Rockville, Md.-based consulting group. Dan Trosch, author of a report from Fortigent, says more numerous listing requirements, and the burden of Sarbanes-Oxley, are to blame. In 2006, there were 475 ADRs listed on the U.S exchanges, down 20 percent versus 2001.

London is increasingly the choice for raising capital — especially for larger foreign companies — because it has fewer regulatory requirements compared to the U.S., Trosch notes in the report. But Luxembourg has also become a very popular exchange for foreign listings.

NEW DEPOSITORY RECEIPT STOCK EXCHANGE LISTINGS
(By Exchange, 2006)

Luxembourg 29
London 25
NASDAQ 7
NYSE 13
Other 4
Source: Bank of New York
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