Euronext Growth Oslo: The Balancing Between Investor Protection and Efficient Markets

Abstract

The topic for this thesis is the investor protection on Euronext Growth Oslo (“Growth”). More specifically we will analyse the balance between investor protection and listed companies’ need for raising capital efficiently. Growth is a Multilateral Trading Facility (MTF) established by Oslo Børs ASA in 2016. MTFs have less regulations than ordinary regulated markets, such as Oslo Børs. Growth had a significant increase in activity in the second half of 2020 and the beginning of 2021, and many of the companies have been priced quite high. However, many have criticised the marketplace for weak investor protection. Thus, we review the regulations on Growth by comparing it to the regulations on the main market, Oslo Børs. We review both the admission rules and the disclosure requirement, and find it most relevant to further analyse the disclosure requirements. The disclosure requirements we analyse are the obligation to disclose large shareholdings, the requirements to report with IFRS and ESG reporting. As the rules are only applicable to the regulated markets and not MTFs, we discuss whether these are rules that should also apply to Growth. Our objective is to investigate whether these sets of rules could lead to increased investor protection on Growth, without having obvious disproportionate costs. Based on our review, we have concluded that it will be beneficial to introduce a more comprehensive obligation to disclose large shareholdings on Growth. However, based on the situation today, it appears like that the costs will outweigh the benefits if mandatory IFRS and ESG reporting requirements are introduced.