Citing new research commissioned by both itself and the Stock Exchange Liffe said the argument

Citing new research commissioned by both itself and the Stock Exchange, Liffe said the argument that market-makers' n on-disclosure privileges were the key to maintaining a liquid market had been exposed as exaggerated. Liffe, the London Futures Exchange, called yesterday for a drastic reduction in market-makers' exemption from disclosing trades. Directors and employees may also face unlimited fines and up to two years in jail if they have aided and abetted in the contempt.. Stephen Locke, policy director at the CA, said: "It is an area wherecrime pays in Britain. The chances of getting caught are not great and the penalties usually mean being told not to do it again."Sir Bryan said the decision to launch the campaign followed a break-through judgment in the House of Lords that ruled against a successful appeal by ready-mixed concrete firms found guilty of contempt of court in 1990.The House of Lords ruling made it clear that companies are responsible in law when their employees participate in unlawful cartel agreements in the course of their work, even if they were not ordered to do so.The Office of Fair Trading now plans to take ready-mixed concrete companies back to the Restrictive Trade Practices Court some time this year.The case, which started with a whistle-blower about 20 years ago, has been widened to cover about 20 companies involved in up to 70 agreements throughout Britain If a company is found guilty of contempt, an unlimited fine may be imposed upon it. I need adequate information before I can even commence an investigation, let alone make a case in court."I am keen for inside information, particularly from former and present employees," he said.Sir Brian also reiterated calls for the Government to fulfil its promise to strengthen the law and the penalties against those involved in cartels and to provide the OFT with greater powers of investigation."I urge the Government to implement soon the reforms proposed in the 1989 White Paper, Opening Markets, to ban cartels and to increase my powers to uncover and deal with them."The Consumers' Association added its voice to the call for government action, saying that any attempts by the Office of Fair Trading to drive out cartels would otherwise prove "hollow". The merest hintof this is sure to provoke ferocious opposition across a wide front..

The Office of Fair Trading has called on workers to report unlawful price-fixing agreements and to provide information over a 24-hour telephone hotline. Sir Bryan Carsberg, Director-General of Fair Trading, said he had formed a task force to persuade informants to help him uncover such cartels. He added that the task force would seek to educate consumers and workers at all levels about the "pernicious" effect of cartels and the damage they caused the economy."Secret price-fixing agreements invariably result in the exploitation of customers and market-sharing cartels are tantamount to criminal fraud. Privately, big institutions that sub-underwrite these issues admit it is mostly money for old rope. But if fundamental change is desired, then the only way to achieve this would be to scrap pre-emption rights. But this does not alter the impression that the fees, and notably the underwriting charges, are excessive. The administrative costs of the American alternative, general market placements, are higher.

Is the established method of raising capital by rights issues cost-effective and fair? The evidence is so-soat best.International comparisons show that the rights issue method is not that expensive. A better outcome could be to publish a high-profile report, and - if overcharging is demonstrated - let market forces determine whether changes are needed.Nobody would deny that underwriting costs are an important part of the wider, highly political, debate about the cost of capital in this country. He knows that a reference is not necessarily the best way to get to grips with this particular thorny issue. He also has, by regulator standards, an unusual amount of common sense.

On his files, if he needed supporting evidence, is a report from Paul Marsh, a distinguished professor at London Business School, which suggests institutions are earning excess profits from their underwriting activites.Alas for those who like a good scare story, the chances that Sir Bryan will trigger an MMC enquiry look slim Sir Bryan recognises a complex issue when he sees one. He has been canvassing opinions from vested interests, including merchant banks, brokers and fund managers. Everything, including time-honoured custom and practice, is now fair game. The future of the rights issue, a central plank in the UK system of corporate finance, is again in the frame.There is plenty of prima facie evidence that the system of paying comissions for underwriting share issues - though it has stood the test of time - is potentially anti-competitive, and imposes unnecessary costs on firms seeking to raise new equity capital.Whether this would justify Sir Bryan Carsberg, director-general of the Office of Fair Trading, ordering a Monopolies and Mergers Commission investigation, as reports suggested yesterday, is another matter. Not so long ago the idea of some busybody government regulator daring to investigate the way that the City organises its activities would have been regarded with horror, bordering on outrage. Since Bi g Bang, and the Lloyd's nightmare, however, all that has gone by the board. On the other hand, to give preference to an American bidder over Glaxo is unlikely to be in the company's, or Britain's, best interests.

The sooner the search for that illusory white knight is exhausted and the serious discussion on how to go forward together begins, the better.So-so evidence on money for old rope Is nothing sacred in the City any more? It seems not. According to Glaxo, Wellcome by itself would be incapable of sustaining the sort of research facility that success in pharmaceuticals requires.Wellcome owes it to its shareholders to explore all available opportunities. Gone are the days when drugs were stumbled upon by accident and the mechanism by which they work discovered later. Today the mechanism comes first and the drug is designed against it. One is the shift in market power from producer to purchaser, requiring dramatic changes in organisation and marketing The other is in science and technology. But the reality is that whoever ends up with Wellcome will go through exactly the same slash and burn process.For Glaxo, however, this is not merely a cost-cutting exercise.