Tradepoint, the small UK stock trading system, yesterday became the first foreign securities market to win permission from the Securities and Exchange Commission to set up in the US.

But SEC officials said the move was unlikely to be followed in the short term by the green light for other foreign organisations.

Tradepoint may now establish its screens in the US to trade UK equities on condition it remains a small system, with a cap of 10 per cent of the turnover of the London Stock Exchange, the officials said.

In addition, it will only be permitted to offer access to its system through qualified US brokers. Shares in Tradepoint Financial Networks, which runs the system and is quoted on the AIM market, went from 18 1/2p to 36p.

Large foreign exchanges such as Deutsche Borse and the LSE, which would like a US presence, look set to remain locked out of the market for some time.

The SEC says it is examining how to relax restrictions on large exchanges, including the thorny requirement that they only offer securities registered under US rules. Given the differences in accounting and disclosure standards between the US and other markets, this excludes foreign exchanges.

Nic Stuchfield, Tradepoint chief executive, said the US move would enable US buyers of UK equities to make substantial cost savings. "US investors regard investing in UK equities as being very expensive. There is absolutely no doubt these costs can be dramatically cut," he said.

Tradepoint has 81 members in Europe. Mr Stuchfield said there were probably 100 US investors active in the UK equity market who would be targeted for membership. The exchange is in talks with possible partners about raising capital. Mr Stuchfield declined to discuss how much money Tradepoint wanted or if it would involve new investors.

Foreign futures exchanges have been critical of the high regulatory hurdles to setting up in the US.