The OFT's investigation, under the Financial Services and Markets Act 2000, was in response to the LSE's significant increase in issuer fees for the year 2002/3. It comes amid growing complaints among large investment banks about the pricing power wielded by monopolistic national exchanges.

The LSE has agreed to reduce its annual fees for issuers by more than 25% on average with effect from 1 April 2004. The OFT estimates that these price reductions will reverse most of the 2002/03 increase - bringing it down from around 85% to an increase of 35%. The LSE has also agreed not to raise main market annual fees significantly for a further two years.

The LSE has also undertaken to reduce its admission and annual fees on the small cap AIM market. In all, it is estimated that had these prices been in place in 2002/03 the LSE's revenue from charges would have been around £5.8m lower.