FCA proposes changes to listing regime, bond markets

(Sharecast News) - The Financial Conduct Authority (FCA) unveiled comprehensive proposals aimed at enhancing the accessibility, efficiency, and competitiveness of the UK's listing regime on Wednesday and improving the bond and derivatives markets. Following a consultation in May, the FCA released plans outlining a simplified listing regime with a single category.

The City regulator said the streamlined approach was designed to encourage a broader spectrum of companies to list in the UK, fostering global competitiveness.

Its proposals also focussed on a disclosure-based regime, emphasising the provision of sufficient information to empower investors to influence company behaviour and investment choices.

The FCA suggested disclosing significant transactions while retaining sponsor scrutiny for related party transactions, replacing mandatory votes.

However, shareholder approval would still be required for pivotal events, such as reverse takeovers and delisting.

The proposals could potentially increase the risk of failures, but the FCA said they aligned with the risk appetite needed for sustainable growth.

"We are working to strengthen the attractiveness of UK capital markets and supporting UK competitiveness and growth," said the FCA's executive director of markets and international, Sarah Pritchard.

"As we do so, it is important that others consider what they, in turn, can do to make sure the UK remains an attractive place for companies to raise capital.

"We welcome feedback on our detailed proposals to make sure that we have the balance right as we seek to set the standards for the years and decades ahead."

In addition to the listing reforms, the FCA said it was advancing key elements of the Edinburgh Reforms.

It confirmed the regulatory framework for a bond market consolidated tape, which would deliver trade and sales data to investors more efficiently and cost-effectively.

The FCA said it intended to introduce a consolidated bond tape, focusing on shares in 2024.

Furthermore, measures were outlined to enhance real-time information publication in bond and derivative markets.

The FCA said the measures would allow for the establishment of fair prices and improve investors' ability to buy or sell.

It said the proposed standards would ensure that the upcoming bond consolidated tape data was standardised, comprehensive, and of high quality.

"The UK is Europe's leading hub for investment, but it's a competitive world, and we are by no means complacent," commented Bim Afolami, economic secretary to the Treasury.

"We want to make the UK the global capital for capital, attracting the brightest and best companies in the world.

"We are strengthening the UK as a listing destination, taking forward reforms to make it quicker to list, improve disclosure and make our capital markets more efficient and open."

Reporting by Josh White for Sharecast.com.