New legislation to give some companies relief from foreign ownership restrictions has been welcomed by energy company Ascendant Group, which said it would stimulate the availability of overseas capital to fund infrastructure projects.BF&M Ltd CEO John Wight also believes the lowering of barriers to overseas investors will allow firms to access more capital when they need it and no longer suffer from hitting “the 40 percent wall” when they reach the limit for foreign ownership.The Companies Amendment Act 2012, passed by MPs last Friday, will allow publicly traded companies in specified industries to apply for relief from the 60-40 rule, which requires a minimum 60 percent stake to be held by Bermudians.“Bermuda’s success, particularly over the last two decades, has lead to an influx of overseas investors such that several of the Island’s public companies have reached their foreign ownership limits,” an Ascendant spokeswoman told The Royal Gazette.“The continued growth of these companies, as well as Bermuda as a whole, is predicated on the ability to access capital.”Ascendant’s subsidiary Belco’s plans for building the new $70 million North Power Station to replace ageing plant were recently put on hold. The company could not get permission for a sufficient increase in electricity rates it said it needed to secure a bank loan to fund the project.Opening the door to more foreign investment will give the company a wider range of alternative sources of capital.“The Ascendant Group fully supports changes that will stimulate the availability of international capital to Bermuda’s shores particularly as it relates to investment in Bermuda’s infrastructure,” the spokeswoman added.“Ascendant’s attractiveness to overseas investors, and the new opportunities this change to the 60-40 rule may bring in terms of needed capital for Bermuda’s electric infrastructure potentially provides new sources of capital for many opportunities.“This change also has the potential to encourage increased liquidity in the local stock market and improve market value of local company shares.”BF&M’s Mr Wight also believed the amendment to the law represented a step forward.“While the 60-40 rule served a useful purpose for many years, in 2012 we have to be looking at serving the needs of our Island going forward,” Mr Wight said, adding that the BF&M board of directors had not met to discuss the amendment, so views he expressed were his own rather than his company’s.A basic principle of modern markets is that capital should be freely transferable, Mr Wight added, and the amendment would help to make this happen.“From Bermuda’s perspective, it will allow fresh capital to be injected at a time when a company needs new capital, and so may help local listed companies to grow efficiently,” Mr Wight said.“Some local companies have been stifled when they have hit the 40 percent wall. Demand from Bermudians for local shares, because of recessionary conditions, has lessened in recent years.“Some non-Bermudian investors looking to invest in companies like BF&M have been unable to do so, because of the 60-40 rule. Whether this will mean wholesale ownership change for Bermudian companies remains to be seen.”He believed that foreign investors could be attracted to BF&M, because of its track record of profitability, its five-percent-plus dividend yield and its expansion beyond Bermuda, highlighted by its acquisition of Cayman-based insurer Island Heritage earlier this year.Like Ascendant, Mr Wight believed the easing of 60-40 restrictions could lead to greater liquidity.“That’s one of the reasons that local investors can be put off investing in local companies — because the share volumes are so small,” he said. “That, to some people, suggests an inefficient market. Relief from the 60-40 rule will help liquidity.”