Below is our quarterly briefing covering the most important developments for UK PLCs, UK equity capital markets and UK public M&A.
In this issue, we review:
- Primary Market Bulletin 54 — Strategic leaks and unlawful disclosure in M&A transactions.
- FTSE Russell — Changes to FTSE UK Index Series methodology.
- Update to the Takeover Code Jurisdiction.
- PISCES — HMRC consultation on stamp duty and stamp duty reserve tax exemptions.
- FCA Consultation Papers 25/2 and 25/3 — Consultations on further changes to the public offer and admissions to trading regimes, and requirements for firms operating public offer platforms.
- Policy Paper — Ensuring that regulators and regulation support growth.
- FCA Handbook Notice 128 — Consequential amendments to both the UK Listing Rules and Disclosure Guidance and Transparency Rules to reflect the 2024 UK Corporate Governance Code.
Primary Market Bulletin 54 (PMB 54) — Strategic Leaks and Unlawful Disclosure in M&A Transactions
14 March 2025 / FCA
In PMB 54, the Financial Conduct Authority (FCA) focused on strategic leaks and the unlawful disclosure of inside information during live M&A transactions. The FCA emphasised the importance of maintaining market integrity and investor confidence during these transactions by ensuring that inside information is disclosed in a manner that is fair and not misleading.
The FCA highlighted that strategic leaks, in which information is deliberately and selectively disclosed to certain parties before being made public, can undermine market fairness and lead to an uneven playing field. Such practices often constitute “inside information” under Article 7 of the UK Market Abuse Regulation.
The FCA emphasised the legal responsibilities of issuers and their advisers in managing inside information appropriately and the obligations under both:
- The FCA’s Code of Conduct Rules, particularly COCON 2.1, which requires individuals to act with integrity and adhere to proper standards of market conduct.
- The Takeover Code’s Rule 2.1(a), which stipulates that confidential information, especially price-sensitive information, must only be shared with another person if it is necessary and if that person is made aware of the need for secrecy.
The FCA warned that any attempts to manipulate the timing or recipients of such disclosures to gain an advantage during the course of live M&A transactions constitutes a serious violation of these regulations. Enforcement actions, including unlimited fines and public censure, can be imposed on those involved.
FTSE Russell Announces Changes to FTSE UK Index Series Methodology
3 March 2025 / LSEG
Following a review of the FTSE UK Index Series, FTSE Russell announced changes to the Sterling Denominated Price Requirement and Fast Entry Thresholds, with effect from September 2025.
Securities trading in currencies other than pound sterling will be considered for potential inclusion to the FTSE UK Index Series, provided they meet the other eligibility criteria. Currently, only securities trading in pound sterling can be included in the FTSE UK Index Series. As of 31 January 2025, there were no new companies immediately eligible for inclusion on the effective date of this change, but the actual and longer-term impact will be guided by changes to the underlying market and index-eligible securities that may opt to trade in euros or US dollars.
Currently, for new UK listed companies to be eligible for inclusion in the FTSE 100 under the “Fast Entry” process after its IPO, a company must:
- Rank 75th or above in the FTSE UK Monitor List.
- Have an investable market capitalisation of at least ₤2 billion.
From September 2025, the Fast Entry thresholds for new issuers will apply to both the FTSE 100 and FTSE 250, and will also be amended to:
- A ranking of at least 225th or above in the FTSE UK Monitor List based on the closing price on the first day of unconditional dealings.
- Have an investable market capitalisation of at least ₤1 billion.
If the company meets these requirements, it will be placed in the FTSE 100 if it ranks at least 90th, or in the FTSE 250 if it ranks at least 225th, after close on its fifth day of trading. Concurrently, the lowest rank constituent will be deleted from the applicable index, and associated membership changes will be implemented.
Update to the Takeover Code Jurisdiction
3 February 2025 / Takeover Panel
Following public consultation on amendments to the applicability of the Takeover Code (as discussed in our April 2024 article), on 3 February 2025 the Takeover Panel amended its jurisdictional scope, limiting it to UK-listed companies.
A two-year transition period will apply, following which the Code will cease to apply to all overseas listed public limited companies (PLCs), unlisted PLCs and private companies. The Code will continue not to apply to companies that have their registered offices outside of the UK, Channel Islands or Isle of Man.
During this transition period, companies that are not UK-listed but have their place of central management and control in the UK, the Channel Islands or the Isle of Man will need to assess whether they are subject to the Takeover Code.
HMRC Consultation on Stamp Duty and Stamp Duty Reserve Tax Exemption for PISCES Transactions
26 March 2025 / HMRC
The UK government has recently outlined its plans regarding the tax treatment of shares acquired by employees under company share-option or enterprise management incentive schemes, and subsequently traded on the Private Intermittent Securities and Capital Exchange System (PISCES) platform.
According to a technical note released by HM Revenue & Customs (HMRC), transactions involving such employee shares traded on PISCES will be exempt from stamp duty and stamp duty reserve tax. This exemption is anticipated to streamline the trading process and reduce the tax burden on both companies and employees participating in share trading on PISCES.
The consultation process is set to conclude on 23 April 2025, and a legislative framework for the new tax regime is expected to be published in May 2025.
FCA Consultation Papers 25/2 and 25/3 — Consultations on Further Changes to the Public Offer and Admissions to Trading Regimes, and Requirements for Firms Operating Public Offer Platforms
31 January 2025 / FCA
On 31 January 2025, the FCA published two consultation papers:
- CP25/2 requested responses on the further proposed changes to the public offer and admissions to trading regimes (POATRs). (See our article on POATRs.)
- CP25/3 requested responses on the implementation and operation of the new public offer platform (POP) regime.
Both consultations closed on 14 March 2025.
POATRs
The proposals include:
- Aligning prospectus requirements for non-equity securities to a single standard based on current disclosure requirements for “wholesale” denominations.
- Implementing new guidance defining which low denomination corporate bonds issued by listed companies can be appropriate for the “mass market”.
- Changing the listings application process for further issuances to reduce friction and support the CP24/12 proposals to reduce regulatory intervention in such transactions.
- Removing Listing Particulars as a listing admission document to simplify the listing framework and better align with POATRs reforms.
- Adopting consequential changes to the FCA Handbook (including transitional provisions and building on the rules proposed in CP24/12).
Following a review of the responses received, the FCA is aiming to finalise the rules and publish a final policy statement in summer 2025.
POP Regime
The consultation paper focused on further details for the new POP regime and how the FCA plans to operate the authorisation gateway for firms wishing to operate POPs, including how it intends to supervise these firms. The POP regime is designed to facilitate companies making public offers of securities to a broad range of investors outside public markets when raising more than £5 million.
The new regime for POPs is envisaged to come into force in January 2026 following publication of the final rules for the POATRs framework, which are subject to agreement with the HM Treasury. The FCA proposes to add the new regulated activity of operating a POP into its broad supervisory framework.
Policy Paper — Ensuring Regulators and Regulation Support Growth
17 March 2025 / HM Treasury
The UK government has introduced a new strategy designed to reduce the regulatory burden on businesses and stimulate economic growth. Outlined by HM Treasury, this initiative emphasises the importance of a more dynamic and adaptable regulatory framework that can meet the changing needs of businesses and the economy.
Key measures include:
- Streamlining regulatory processes.
- Minimising unnecessary business constraints.
- Improving the overall efficiency of regulatory bodies.
In a recent op-ed published in City AM, the prime minister reaffirmed the UK government’s commitment to reducing regulatory costs by 25%. This target is part of a broader effort to position the UK as one of the most attractive destinations globally for starting and growing a business. The UK government plans to achieve this reduction through a combination of deregulation, simplification of existing rules and the introduction of more proportionate and risk-based regulatory approaches.
By reducing the regulatory load, the UK government aims to foster a more agile and responsive business environment capable of quickly adapting to global market changes. This approach is intended to drive innovation, attract investment and create job opportunities across various sectors. The UK government views this approach as crucial for maintaining the UK’s competitive edge in the global market, thereby ensuring long-term economic prosperity.
FCA Handbook Notice 128 — Amendments to Both the Listing Rules and Disclosure Guidance and Transparency Rules To Reflect the 2024 UK Corporate Governance Code
28 March 2025 / FCA
The FCA has published Handbook Notice 128, which includes administrative updates to both the UK Listing Rules and the Disclosure Guidance and Transparency Rules (DTRs) for the UK Corporate Governance Code 2024. Notably, the Handbook Notice confirms that companies with financial years beginning on or after 28 March 2025 can continue to report against existing Provision 29 of the UK Corporate Governance Code 2018 in respect of internal controls.
The new Provision 29 of the UK Corporate Governance Code 2024, which requires the board to make a declaration on the effectiveness of material controls in the annual report, will apply to all companies for financial years beginning on or after 1 January 2026.
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