The Financial Conduct Authority has published its quarterly consultation paper which, amongst other things, proposes a number of amendments to the Listing Rules, Prospectus Rules and Disclosure and Transparency Rules. The proposals include:

  • Changes to the requirements on cancellation of listing of securities following a takeover offer. This would require a controlling shareholder (of 80%) to obtain acceptances of their offer from independent shareholders which represent a majority of voting rights held by independent shareholders for a cancellation request to be made. In proposing this change, the FCA has stated that this should not be seen to imply a more general tolerance of low free floats as it retains the ability, on a case-by-case basis, to initiate delisting where the remaining free float proves too small to support adequate liquidity.
  • iStock_000049398330_SmallImplementing certain parts of the Statutory Audit Amending Directive (SAAD). In particular, the FCA is consulting on the implementation of the changes to the requirements for audit committees of public interest entities. The provisions of the SAAD must be implemented in the UK by 17 June 2016. Subject to the consultation, the FCA anticipates that the proposed new rules will come into effect in June 2016 for financial reporting periods beginning on or after 17 June 2016.
  • Amending rules in the DTR to reflect the transposition of the Accounting Directive which repeals and replaces the Fourth Company Law Directive and the Seventh Company Law Directive.
  • Aligning the Prospectus Rules with draft regulatory technical standards (RTS) on the Prospectus Directive arising from the Omnibus II Directive. Although the draft RTS are potentially subject to change it is possible that the RTS take effect this Autumn. The FCA is therefore consulting now on the basis of the draft RTS, so that it can be in a position to amend the PR to ensure compatibility with the RTS provisions when they take effect.

Responses to the consultation on the proposals contained in Chapter 8 of CP15/28 are requested by 5 November 2015, apart from the proposed amendments to the PR and the Glossary definition of “Prospectus RTS Regulation” in respect of which responses are requested by 5 October 2015.

A copy of the consultation paper can be viewed on the FCA website.