FCA Plans To Reform The Listing Regime In The U.K

The United Kingdom’s financial watchdog, the Financial Conduct Authority (FCA), announced new reforms to the listing regime. Details released by the financial regulator highlight the steps it needs to take to make the listing regime effective.

One of the proposed suggestions made by the Financial Conduct Authority is the limited segment given to companies. In contrast to the previous process, companies looking to list in the U.K. can select a single listing segment.

FCA Committed to Improving Listing Regime

The financial watchdog introduced a series of steps last year to enhance the listing regimes in the United Kingdom. The steps taken include:

  • lowering the free float levels.
  • permitting some dual-class share groups.
  • implementing digital financial reporting.

Furthermore, the FCA noted that the London equity market is trusted worldwide by companies needing capital. And that trust is enabled by having strong standards and a collection of supportive stakeholders like buyers and traders.

The FCA has a role to play, and the rules targeting companies looking to list in the U.K. remain the same. Moreover, the FCA has sets of standards guiding the process of listings subject to the laws of the United Kingdom.

However, the FCA noted that it is considering reforms due to changing financial processes and ways of doing things. Now is the time to have an honest conversation to ensure the rules can accommodate future market practices.

The U.K. has a growing and competitive market that is attractive to diverse businesses, making it a global investment hub.

The U.K.’s Expanding IPO Market

The United Kingdom has one of the biggest initial public offering (IPO) markets globally. Last year, the IPO market saw remarkable growth as the market sealed new entrants and deals.

FCA further disclosed that companies in the U.K. raised a whopping £16.9 billion last year through IPOs. This signals the highest growth of the IPO space in the country.

Moreover, 126 companies participated in the raising of the IPO in 2021. All the companies involved are duly listed on the London Stock Exchange. Therefore, the FCA aims to build on the success recorded so far.

The Financial Conduct Authority is the U.K.’s foremost financial watchdog with a mandate to regulate the financial sector. Over the years, it has made numerous advances in overseeing the sector’s activities.

However, the emergence of cryptocurrency has added another challenge to the financial regulator’s function. The FCA, since January, has embarked on holistic reforms to manage the activities of crypto companies.

It is the U.K.’s overall anti-money laundering body. The agency also ensures that the crypto industry complies with the guidelines regarding reporting illicit transactions.

Meanwhile, crypto enthusiasts in the U.K. are hoping that the FCA will help implement crypto-friendly laws. The digital currency industry faces regulatory scrutiny from the U.K. authorities and their uncertainty about cryptocurrency to the economy.

The FCA continues to regulate how companies would use crypto assets while setting limits to what is regarded as redlines.

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