26 January 2012

FSA Amendments to the Listing Rules, Prospectus Rules, Disclosure Rules and Transparency Rules

This consultation paper sets out proposals for changes to the Listing Rules to ensure that they reflect recent changes in market practices properly, and so allow the UK Listing Authority (UKLA) to meet its objectives.

The FSA objectives include:

• providing an appropriate degree of protection for investors in listed securities;
• facilitating access to listed markets for a broad range of enterprises; and
• seeking to maintain the integrity and competitiveness of UK markets for listed securities.

Since the Listing Regime came into force in 2000 the FSA has reviewed it, either in whole or in part, on a regular basis, and where necessary has, following consultation, made changes to help mitigate new risks and to maintain its overall effectiveness. The last such review, in 2008 to 2010, examined the overall structure of the Listing Regime. Following this the FSA made changes to enhance the clarity and the standards denoted by the different segments so that investors would be better placed to make properly informed decisions and issuers would benefit from appropriate flexibility when raising capital in the UK.

It has, however, been some time since the FSA has carried out an assessment of the technical content of the Listing Rules to identify specific areas where rules may need to be updated or clarified to reflect changes in existing market practices or the emergence of new ones. This is one of the objectives of this consultation. At the same time, the FSA is proposing to incorporate into the formal body of the Listing Rules other relevant material that it has, for example, in its Technical Notes. The FSA believes that this codification will benefit all users of the Listing Rules. Where, following consultation, the FSA incorporates Technical Note material within the Listing Rules, the FSA will subsequently update the Technical Notes to reflect this.

In this consultation paper the FSA is focusing on the changes that are required as a matter of priority to ensure that the operational effectiveness of the Listing Regime is maintained. The principal areas in which the FSA is proposing changes are:

• reverse takeovers (LR Chapter 5);
• sponsors (LR Chapter 8);
• transactions (LR Chapters 10,11, 12 and 15);
• financial information (LR Chapters 6 and 13); and
• externally-managed companies (LR Chapter 6, DTR 3.1 and PR 5.5.3).

Full Consultation paper

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