FCA launches primary markets effectiveness consultation

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On 5 July 2021, the FCA launched a consultation [CP21/21] on a series of proposed reforms to improve the effectiveness of UK primary markets, alongside a discussion of how it might continue to develop the regime to ensure the UK remains a competitive and dynamic market. This consultation follows specific recommendations for improvements to the regime given in both the UK Listing Review, chaired by Lord Jonathan Hill, and the Kalifa Review of UK FinTech. The FCA’s suggested reforms seek to address and build on the proposals in these reviews to ensure that the UK remains an attractive place to grow and list successful companies.

The FCA’s white paper discusses the functioning of the current listing regime, explores potential future models and consults on targeted changes to remove barriers to listing. The proposals being consulted on adopt some of Lord Hill’s recommendation to allow dual class share structures and to make the free float requirements more flexible. Together with HM Treasury’s consultation on the review of the prospectus regime and the FCA’s earlier consultation on SPACs [awaiting the results], this consultation demonstrates the UK government’s drive and urgency to improve capital markets and increase London’s attractiveness as a place to take a company public.

Based upon responses, the FCA will develop proposals for concrete changes to the listing regime for future consultation. The consultation closes on 14 September 2021 and the FCA will make the relevant rules by late 2021.

The press release, which includes a link to the consultation document, can be found here.

Published 8 July, 2021