The Financial Conduct Authority (FCA) has implemented the largest overhaul of UK listing rules in over 30 years to support a wider range of companies to issue shares on the country’s stock markets amid competition from international counterparts. The new rules streamline eligibility for companies seeking to list their shares and establish a simplified listings regime with a single category. These changes better align the UK’s regime with international market standards, maintain appropriate investor protections, and give investors the necessary information to make informed decisions about their money. The rules also provide greater flexibility around enhanced voting rights, removing the need for votes on significant or related party transactions. Shareholder approval for essential events such as reverse takeovers and decisions to remove their company’s shares off an exchange is still mandated. The FCA notes that the new rules involve allowing increased risk but better reflect the economy’s required risk appetite to achieve growth. The new rules will apply from 29th July 2024.
According to Sarah Pritchard, Executive Director, Markets, and International at the FCA, “A thriving capital market is vital in delivering investment to growing companies, plus returns and choice to investors.” She added that the regulatory body strives to make it more straightforward for those seeking to list in the UK, retaining the essential protections ensured by investors in steering the businesses they co-own. Chancellor of the Exchequer Rachel Reeves stated that the financial services sector is central to the UK economy, and these new rules represent a significant first step towards reinvigorating capital markets, bringing the country in line with international counterparts, and attracting innovative companies to list in the UK. The new rules follow extensive engagement across the market and will come into effect on 29th July 2024.
