The London Stock Exchange has outlined proposals to improve its competitiveness in the world markets by opening up membership on its electronic order book to a wider range of smaller and medium-sized firms.

The move by London to boost volumes and listings by increasing its remote membership will enable any firm regulated by the Investment Services Directive to apply to become a Sets participant. The proposed rule change has been approved under the Frankfurt and London-led pan-European alliance agreement, stressed London. Deutsche Börse has made its system available to London's members and has been more successful in attracting brokers and traders to access the German markets from outside the country. Both insist that the continued competition will help pool liquidity in Europe rather than causing it to fragment. However, the timing of London's decision to widen access to the order book comes as Deutsche Börse lays down plans to be renamed Euroboard and create a series of electronic trading networks. Despite this, Frankfurt insists the flagging alliance is still on course. In November last year, Frankfurt was boasting a total of 108 remote or non-German members, 96 of which joined in the first nine months of this year, compared with 266 German members. Meanwhile London, which represents 35% of the European market, had 270 London-based members but just 28 remote members, of which 17 are based in Ireland.