Regulators

FCA launches consultation on primary market reforms

The reforms are set to reduce barriers to listing for companies and increase the range of investment opportunities for consumers on UK public markets

The Financial Conduct Authority (FCA) has announced the launch of a consultation on a series of proposed reforms to improve the effectiveness of UK primary markets.

The reforms are set to reduce barriers to listing for companies and increase the range of investment opportunities for consumers on the country’s public markets

The regulator is proposing measures to ensure the listing regime continues to have high standards of market integrity.

Among the measures the FCA is consulting on are reducing the amount of shares an issuer is required to have in public hands (i.e. free float) from 25% to 10%, and increasing the minimum market capitalisation (MMC) threshold for both the premium and standard listing segments for shares in ordinary commercial companies from £700,000 to £50m.

Clare Cole, director of market oversight at the FCA, said: “Effective public markets are critical in enabling companies to finance their businesses, which in turn creates growth and jobs for the UK economy.

“These proposals are essential if we intend for the UK to continue to be a modern and dynamic market. Today, we are acting assertively to meet the needs of an evolving marketplace.”

She added: “Our proposals should result in a wider range of listings in the UK, and increased choice for investors while we continue to ensure appropriate levels of investor protection.

“They are intended to encourage high quality companies to list earlier, and so increase the possibility of a wider investor base being able to access growth in these companies.”

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