(Alliance News) - The UK Financial Conduct Authority said on Tuesday it intends to reform the listing rules in the UK to help attract a wider range of companies, encourage competition and improve choice for investors.
The FCA said it is proposing "significant" changes to the listing rulebook, including replacing its existing standard and premium listing segments with a single category for equity shares in commercial companies.
The financial watchdog said a single equity category would remove eligibility requirements that can deter early-stage companies, be more permissive on dual class share structures, and remove mandatory shareholder votes on transactions such as acquisitions to reduce frictions to companies.
"The proposed changes aim to provide a simpler and more accessible UK listing regime for companies, improving the attractiveness of listing in the UK and providing a wider range of investment opportunities for investors," it said.
The FCA noted that listings in the UK have reduced by 40% since 2008. Though it acknowledged that the decision by a firm to list is based on more factors than regulation alone, it said the listing regime in the UK has been seen by some as "too complicated and onerous".
"Our proposed reforms would significantly rebalance the burden of regulation to the benefit of listed companies and investors who are willing to set their own risk appetite and terms of engagement," said Nikhil Rathi, chief executive of the FCA.
The financial watchdog said it will also publish rule changes to improve how equity secondary markets operate.
By Heather Rydings, Alliance News senior economics reporter
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