Optimizing Digital Transformation for British Firms

In connection with its evaluation of the UK listing program explained above, the FCA made a couple of modifications to the continuing responsibilities of noted companies, all of which ended up being efficient on 29 July 2024 with the adoption of the UKLR sourcebook. In connection with the collapse of the previous premium and standard listing sections into the brand-new commercial company classification, the Listing Concepts (set out in UKLR 2) were simplified to require business companies to: develop and maintain sufficient procedures, systems and controls to allow them to comply with their responsibilities under the UKLR (Principle 1); deal with the FCA in an open and co-operative way (Concept 2); take sensible steps to enable its directors to comprehend their duties and commitments as directors (Principle 3); act with stability towards the holders and possible holders of its listed securities (Principle 4); ensure that it treats all holders of the same class of its listed securities that are in the very same position similarly in respect of the rights attaching to those noted securities (Principle 5); andcommunicate information to holders and prospective holders of its listed securities in such a way as to avoid the production or continuation of an incorrect market in those noted securities (Concept 6).

As part of the consultation on modifications to the UK listing routine, the choice was required to maintain the function of sponsor. Since of the lighter-touch guideline of the new commercial business classification (notably a relaxation of shareholder approval requirements for considerable and related celebration deals as explained listed below), a sponsor is now just needed to be designated: in the context on an IPO, where a business is looking for admission for the very first time; in the context of a considerable or related celebration deal, where a request is made to the FCA for private assistance or modification or waiver of the guidelines in UKLR 7 or UKLR 8; in the context of a related celebration deal, to validate the deal is "reasonable and sensible"; in the context of a reverse takeover, to offer guidance and submit a circular and prospectus; where needed by the FCA due to a breach (or suspected breach) of the UKLR or DTR sourcebooks; for specific transfers in between listing categories; andin the context of additional share issuances, if a noted company is needed to send a file such as a prospectus to the FCA for approval.

ANSR July UK PRs

Accordingly, under UKLR 7, commercial business are needed to make a market statement as quickly as possible after the terms of a considerable transaction (25%+ on any one of the class tests (consideration, properties and capital), excluding deals in the ordinary course of company) are concurred. No statement requirements are prescribed for deals below that limit, however the requirements of the UK Market Abuse Policy (UK MAR) use.

In the case of a disposal, the announcement should also consist of particular financial details. There is also an overarching catch-all commitment to disclose any other pertinent circumstances or details necessary to enable investors to assess the terms and effect of the deal. No shareholder approval or circular requirements apply to a substantial deal, nor exists any requirement to appoint a sponsor (save where guidance, waiver or modifications from the FCA are sought).

ANSR July UK PRs

Developing Resilient Trade Chains for 2026

Under UKLR 7.5, reverse takeovers (100%+ on any among the class tests (consideration, possessions and capital)) continue to require a market announcement, an FCA-approved circular and shareholder approval. Sponsor guidance should be obtained if a business is proposing to participate in a deal which might amount to a reverse takeover and one must be appointed in respect of the circular and any re-admission prospectus.

Appropriately, under UKLR 8, for deals including an associated celebration (for example, a 20% shareholder or current/former director) which surpass the 5% class test limit (leaving out transactions in the ordinary course of company), the following requirements apply: board approval of the transaction, leaving out any conflicted directors; written verification from a sponsor that the transaction terms are "fair and sensible"; anda market announcement as quickly as possible after the transaction terms are concurred which should include, amongst other requirements, a "fair and reasonable" declaration by the board.

ANSR July UK PRs

The UK Secondary Capital Raising Review, led by Mark Austin MBE, was introduced in October 2021 to examine enhancing further capital raising processes for noted companies in the UK (read our summary here). The findings of the evaluation were released in July 2022 and consisted of several recommendations to the government, the FCA and the Pre-Emption Group (PEG). PEG responded and welcomed the recommendations, subsequently issuing an updated version of its Statement of Concepts on 4 November 2022.