A Merrill Lynch survey showing most international fund managers think New Zealand should have a takeover code has been welcomed by Labour's Commerce spokesperson Paul Swain.

"Merrill Lynch's findings echo what Labour found when we consulted the finance sector on our competition policy," Mr Swain says.

"We also found widespread concern at the lack of protection for minority shareholders in the current regime. That's why our policy focuses on protecting small investors during takeovers, with tougher policing of insider trading and improved co-ordination of the legislation and regulatory bodies governing the sharemarket."

"Labour supports the introduction of a takeover code along the lines proposed by the Takeovers Panel in 1995. We note the Merrill Lynch finding that most of the fund managers surveyed think the threshold for a compulsory offer to small shareholders should be higher than the 20% operating in Australia. We'll consult further with industry and interest groups before finalising the details of a code."

"National has flip-flopped on a takeover code throughout the 1990s and has achieved nothing. It's time to rebuild investors' trust and confidence in the sharemarket and only Labour has the clear commitment to do that."

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